CRN Interview: Huang's Thoughts About India, The Gray Market

Synnex CEO Bob Huang spoke with Editor/News Steven Burke about new market opportunities and the gray market during the distributor's annual partner conference last week in Greenville, S.C. Following are excerpts from thAT interview.

CRN: Talk about Synnex's direction going forward and where you see the greatest opportunity for growth.

Huang: We are selling a lot of new products in the enterprise and vertical markets. The point-of-sale, AutoID, security stuff are all new products. This morning, we had meetings with system builders, who were talking about high-powered computers like Linux clusters. They all offer pretty good potential.

CRN: How do you see the impact of India moving forward and its impact on the channel?

Huang: I think we are the only [distributor] moving to leverage resources [in India] to help the channel. I think if we can make this model work, it will add more value, create more stories and more productivity improvements to the entire industry. We see this as a very positive move.

CRN: Talk about the gray market and the impact that it is having on business.

Huang: One of the things I was talking to the group about is that the whole industry needs to have more discipline in terms of the gray market, managing the products in different geographical areas so the products don't move from one area to another.

Vendors could do that and manage that a lot better than what they are doing. The gray market creates a lot of damage to the industry. The volume is not that big. However, because this whole industry is so competitive, particularly in the margin area, there are people constantly shopping around and this shopping around wastes a lot of people's time and energy for a very small volume of gray market products. That is the thing that the vendors need to make a priority to stop.

CRN: Are the vendors turning a blind eye to the gray market to make the quarterly numbers?

Huang: I don't think intentionally. But most of the geographical area managers do have some leeway to make their pricing decisions and hence sometimes people use back-end money, the marketing dollars, for different purposes. Those are the things that can probably be managed a lot better.