Distributors: More Collaboration Will Increase Channel Profitability

"Continued collaboration, true openness about where each other's plans are going, that will help align [channel relationships]," said Rick Hamada, CEO of Avnet.

Hamada stressed that vendors should be looking for long-term relationships with the channel to be an indirect sales force. "It shouldn't be arm wrestling. This should be win-win. You have to look at the whole map to construct profitability. Look at qualitative and quantitative incentives. We want suppliers to be in it for the long run, set up for mutual success, including the VAR."

Kevin Murai, CEO of Synnex, said two-way communication is key to success and more profitable channel relationships.

"It can't be here are channel programs, hope you're successful at working with them. If we work together we can capture the strengths of each organization," Murai said. "Finally, as we take a look at how we grow together, we all are willing to make investments and willing to make sure we're aligned with where you're headed."

Bob Dutkowsky, CEO of Tech Data said when he took the reins of the Clearwater, Fla.-based distributor about five years ago, it was "us vs. them" in a lot of conversations with vendors about the channel, but it has improved since then.

"The financial stability of partners has improved at the VAR level and the subsequent business dialogue we have has gotten better in the last five years. Today, the dialogue is more about trying to find the win-win," Dutkowsky said. "As an example, we had a meeting with a vendor last week. The vendor has a problem with marketshare, we have issues with performance in that space. But there was not any finger pointing at all. It was about what business problems we both have and what levers can we pull to find business opportunity. That conversation would not have happened five years ago. "

Dean Douglas, CEO of Westcon, said transparency and collaboration are key as is sharing a roadmap so that each part of the supply chain knows where the other is going over time.

"Companies have roadmaps internally for products. It would be great to put together a channel roadmap, to know where you want the channel to pick up investments, where there are changes in the supply chain to address issues," Douglas said. "If we could come up with a roadmap to go to the marketplace for not just for three to six months which is the usual horizon today, but for the next 18 months, we could all make incremental investments over time to be consistent with where a company wants to go."

Greg Spierkel, CEO of Ingram Micro, urged vendors at the GTDC Summit to continue to evolve with their channel partners and learn more about what they need.

"There's still a perception I believe that the value distribution brings is only about a certain place. It's more often [misunderstood] becauseto some degree of not having exposure to us," he said. "That becomes for me the biggest challenge: having co-investment, a rich dialogue and changing the internal perspective of the role and value [of distribution]. We have to do that collectively. "