VARs Give Cautious Welcome to Dell

By Sara Driscoll  |  Posted 2007-12-05 Email Print this article Print

As the formerly direct-only vendor launches its official channel program, VARs are still waiting to see the full outcome.

VARs have given a cautious welcome to Dell's channel announcements Dec. 5, with most saying it will be a wait-and-see scenario.

The vendor, which has been drip-feeding news about its channel plans to solution providers since it made its original channel announcement last year, has finally laid out its official channel program.

Click here to read more about Dell's channel program.

Dell intends to begin recruiting VARs to double its existing VAR base of 15,000 partners. The program will have around six specializations for VARs to certify in, including Managed Services and Enterprise Architecture, and Dell said it is looking to certify between 6,000 and 8,000 partners.

David Cantu, vice president and chief operating officer of VAR Redapt Systems, said Dell should reach this goal quickly. "Dell will be able to handle all these partners with the aid of technology such as Web portals and registration," he said. "We intend to qualify for several specializations, we have always been focused on Enterprise Architecture. We currently have several projects involving disaster recovery, SAN implementation, application acceleration and virtualization on the Dell platform."

Robert May, managing director at Godalming, England-based VAR Ramsac, said the specializations are a good idea. "It will help VARs who can then give expert advice around the technology," he said. However May said they would only really work if Dell then restricted sales of products within those specializations to the VARs that were certified.

"Also Dell must make sure that end users know about these specializations," May said. "It's something that all the channel vendors face; at the end of the day do end users care whether they buy from a certified partner or do they just want the best deal?"

Dell will also have a deal registration program for deals over $75,000, officials said. Cantu said the program will help reduce channel conflict. "The program allows Dell and its resellers to maintain margins and resolve channel issues early," he said. "Our value to Dell is exposing its brand and products to new customers, and this tool will help us accomplish that."

Greg Donovan, president and CEO of managed services provider Alpheon, of Morrisville, N.C., said the deal registration program is a good first step. However he added: "The penalties of a deal that is registered going direct need to be better communicated and potentially stiffened. The draft of the program that I have seen has some room for improvement. I would like to see the sales threshold move down and the somewhat arbitrary nature of the approval process become better defined."

Darren Wesley, vice president of professional services at solution provider ACP, said the challenge for partners will be changing mindsets. "As in most new relationships, the rules of engagement must be identified and then managed to. New partners will have the challenge of the learning curve working with Dell," Wesley said.

"Partners will also need to understand how to work with the Dell Direct Representatives when there is an account with a potential conflict. Partners will need to understand that the paradigm mind shift will still take some time for both parties to iron out the tactical side of the business and servicing our clients."

May agreed. "Dell's whole business model has been so successful direct. It employs a huge number of salespeople and changing their mindsets will be hard. Many salespeople are tuned into WII FM—What's In It For Me?—and so encouraging them to work with the channel will be challenging."

However, most of the partners The Channel Insider spoke to seemed unconcerned about losing out on deals to Dell.

Donovan said: "Given that Dell started as a direct sales company there will always be the fear of a sale being lost to the direct sales side based on a cold call to the customer.

"However, in our five years of working with Dell we have never lost a deal to the direct side. In fact we have turned customers over to the direct side when they are uncomfortable buying Dell hardware from a third party."

Wesley added: "We are not worried about competing with Dell in certain accounts. We enhance the customer experience by procuring their Dell technologies through ACP to support our client needs."

Sara Driscoll began her journalism career at 16 years old on her local newspaper, The Watford Observer. Working part time, she covered a range of beats. Leaving to complete her Journalism Degree at Bournemouth University, UK, Sara then went on to graduate and work for Emap. She began as a reporter on APR, Emap's construction title, being promoted to senior reporter with a year.Sara then joined VNU Business Publications as Deputy News Editor on CRN, the weekly trade title for channel players. She covered industry/business news from vendors, distributors and resellers, product announcements, partner announcements as well as market and trend analysis, research and in depth articles to predict up and coming trends in the sector. She was promoted within a year to News Editor, a year later to Deputy Editor and the following year became Editor. Sara remained editor of CRN for three years, launching the magazine on new platforms including CRN TV and eBooks, as well as several magazine and web site redesigns. She was called on for expert industry comment from various publications including appearing on live BBC news programs. Sara joined Ziff Davis Enterprise as Editor of eWeek Channel Insider. She runs the title in all formats – online up to the minute news, newsletters, emails alerts and events. She also manages the brand of Channel Insider in all formats - events, shows, awards, panel debates and roundtables.Sara can be reached

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