Tech Resellers: My Quick (and Crude) Opinion

When it comes to most IT commodities, I almost exclusively use resellers.  In fact, I look for opportunities to convert to resellers and drive business to resellers whenever possible (which may seem counter-intuitive).  In fact, some manufacturers in this economy are looking to do the same thing because they can't afford to have their own sales forces.  Only for huge ticket HW items do I try and go straight to the manufacturer (e.g., IBM, EMC).  For any SW that is truly mission-critical, I go to the licensor.

Benefits of resellers include:
  • Single throat to choke (or, if you don't like that analogy, one person to hug.  Easier account management, easier to control the sales process--as in a reduced number of sales staff trying to infiltrate your organization)
  • Consolidated spend
  • Consolidated billing
  • Easier to innovate purchasing and AP process (e-catalogs, PO interface, frictionless P2P)
  • Typically vendor agnostic (sometimes, my reseller sales reps tell me when a manufacturer is blowing smoke.  A great example is Microsoft and my LAR.)
  • Better ability to deal with down-turns than manufacturers
  • Usually don't push products (with resellers, the procurement process is a "pull" process)
  • Believe it or not, resellers do a better job of communicating product end of life than manufacturers (manufacturers sometimes like to hide those kinds of things)
  • Highly competitive (I recommend using two resellers, like CDW, SHI, or Forsythe, at the same time to ensure competitiveness and to avoid the needs for benchmarking companies)
Risks or cons--if you can call them that--of resellers include:
  • Indemnification (but this can be minimized through pass-throughs and your legal team needs to figure out how to make this work vs. not make it work)
  • Manufacturer will worry about direct customers first, indirect customers second (usually not an issue for me)
  • Escrow sometimes gets a little complicated

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