Tech Data Offers VARs Extended Credit

The extended credit program, which is similar to what Tech Data has developed with Cisco Systems, allows solution providers 60-day credit terms through floor planning with GE Commercial and Distribution Finance, said Mike Zava, vice president of U.S. credit services at the distributor. The program covers Avaya's Merlin Magix Integrated System, Partner Advanced Communications System and IP Office PBX.

Solution providers said the new credit program, as well as Avaya's deeper relationships with a broadline distributor, helps extend their payment cycles, improves product delivery and gives them access to a varied line of products. "Avaya could be difficult to deal with directly," said Skip McGaha, CEO of ArkLaTex, a solution provider in Shreveport, La. "With Tech Data on their side, Avaya may be able to push their IP products better."

Paul Cantwell, global sales vice president for SMBs at Avaya, said partnerships with broadline distributors help his company reach traditional data VARs that are driving convergence solutions into the sweet spot of the market. "Now that we have convergence platforms that are competitively priced, we can offer an attractive opportunity to the VAR who wants to provide more than just iron," Cantwell said.

The relationship is also beneficial to Tech Data since many of the roughly 1,200 solution providers prequalified by the distributor were not regular customers, Zava said. The program helps bring the solution providers deeper into the Tech Data fold by introducing them to services that manufacturers don't count as their core competencies, he said. "In today's environment, many manufacturers have to cut back to become more efficient. We're set up to execute the different processes that help manufacturers penetrate the SMB [space] more effectively."

Tech Data works with 16 leasing vendors and credit facilities and provides extended credit for manufacturers such as 3Com, LSI Logic, Nortel Networks, Proxim, Seagate Technology and Sony. "Banks have always shied away from SMBs because they think they're too risky," Zava said. "Our credit programs enable a lot of our SMB customers to step off in the right direction and to ensure their success."