Survey - VARs Fear Dell Will Steal Customers

A Dell-commisioned survey has found that about 60 percent of solution providers are afraid that Dell would compete for resellers' customers, a key hurdle the company must overcome as it tries to court the channel and grow its indirect sales.

In an item posted on Dell's corporate blog, Direct2Dell, Chris Bates, director of the company's Solution Provider Direct organization, said the company ordered the survey as it works behind-the-scenes to create its first, end-to-end channel program.

"According to a Bain survey recently commissioned by Dell, it's not surprising that about 60 percent of solution providers surveyed have concerns about Dell's direct hardware business competing with their sale or resale of hardware to customers," Bates said. "Deal Registration will reduce this conflict and hopefully increase solution providers' trust in Dell."

Bates said Dell recently hired the Institute for Partner Education and Development - - IPED - - "to help us flesh out details of our initiatives. Their channel expertise and credibility is extremely valuable to us, and we are excited about the partnership."

IPED is a unit of CMP Channel, which is also the parent of ChannelWeb.

Since May, when Dell Chairman and CEO Michael Dell first told CRN that the company would seek to expand its indirect sales in North America from a $4 billion annual run rate, solution providers have been largely split on whether this would help or hurt the channel. It has only become more controversial since Dell announced it had agreed to buy MSP technology provider Silverback, which had been a key supplier of remote management products to solution providers, but more solution providers are offering heated words for the once direct-only PC maker.

"They sound like they've got good meaning behind it, but I'm kind of skeptical about it," said Emilio Ordonez, CEO of Syscom, a Boise, Idaho-based solution provider. "I think they've tried this before, and it seemed like they're still pushing their own direct methods out there anyway."

Brian Swanson, president off SRV Network, a Chicago, Ill.-based solution provider, said his company resells Dell products, describing it as a "necessary evil.

"We do buy a lot of Dell product, and we've worked with Dell for years," Swanson said. "We actually have had pretty good luck -- and I've talked to people who haven't had as good luck -- with our Dell reps. Our Dell account reps really work with us, especially on pricing."

Bill Downing, president of South Bay IT Consulting, a Chula Vista, Calif.-based solution provider, said he's willing to listen to Dell as it provides details of its forthcoming deal registration and certification programs. But those programs won't be available for as much as four months from now, and, Downing said, "I am going to be very patient, but I can only wait so long. I have a business to run."