Tech Data could be in for a $100 million windfall following its deal to partner with ASCII Group.
ASCII Group is a 1,000-member reseller community group, which leverages its membership to get better pricing and deals in the marketplace. The deal means that ASCII members will get specific discounted deals, bundles, pricing and marketing from Tech Data, according to Alan Weinberger, chairman and CEO at ASCII.
“This is the first deal we have had with Tech Data for a number of years,” he told Channel Insider. “We expect this to grow incremental sales for Tech Data by around $100 million as our members move business from other distributors to Tech Data to take advantage of the deals we will get through it.”
Although the decision of which distributor to use is up to each member, Weinberger said it is likely that Ingram Micro could be hardest hit.
“We are a for profit organization, so it means we can play favorites. We have this deal with Tech Data, which means we will bring more volume to it. Our members then get better deals and Tech Data gets incremental business.” He said the deal is aimed mainly at SMBs. “We believe that Tech Data would do a better job of serving our SMB members than Ingram Micro could,” he added.
The ASCII Group, which does about $1 billion through distribution in the United States, also has deals with Bell Micro, Synnex and D&H. “This [Tech Data] deal will not take anything away from our existing partners; it will attract more members to the group, giving our existing distribution partners a bigger base to sell to.” Weinberger said with Tech Data on board ASCII hopes to increase membership by 25 percent within a year.
“We are a community of independent VARs and everyone is starting to see the value in communities,” he added.