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Distributors boost two-way market data flow

by Stuart Wilson, Thursday 30 November 2017

Distribution, while well placed to provide vendor information to channels, is increasingly offering market insights back to vendors, according to the latest research from the Global Technology Distribution Council (GTDC). The research looks at what vendors think about distribution’s new emerging roles, which includes expanded services going forward. Vendors also mentioned they would like to see a program for increasing trust and partnership between the various channel tiers.

As the industry moves to higher adoption of a cloud model, vendors will increasingly rely on distribution for feedback on the market. Peter van den Berg, general manager of the GTDC in EMEA, said: “The distributor knows the vendors and works on the solution and knows how to glue it together. [We are] in the middle with knowledge and can pull down the education and training.”

The research shows that more than 60% of vendors see both the value and the share of business going through two-tier distribution over the next 3 -5 years as increasing. While other forms of distribution will be considered, for example, fulfilment services and one-tier online resellers, vendors will see, by far, the bulk of their business being transacted through value-added distribution.

Indeed, value-added distribution will grow compared to the ‘volume’ end of the business, says the research. Much of this growth will be in the mid-range or SMB market.

This issue is set to become more dominant as more than 75% of vendors expect to see an increase in the value of their business being transacted through distribution. More than 70% of vendors surveyed indicated that they expect to see an increase in the share of business going through two-tier distribution.

The range of products and services being offered is also increasing with recent research conducted by IT Europa showing that many larger distributors are now offering cloud, analytics, IoT and other services, and investing heavily in staff and training to support new distribution business models.

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May, 2021

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