Dell's Vitagliano: Distribution Business Up Double Digits Year Over Year

Dell's business with distribution partners has been growing at a steady clip, and the company said having the right balance is key.

"We're always looking at it. We try to be careful," Frank Vitagliano, Dell vice president for global partner strategy and programs, told CRN. "For a vendor, there's always a concern with being overdistributed. We want to balance having the right level of reach in the marketplace, and ensuring partners have the ability to make money selling our product."

Dell currently has three major distribution partners: Ingram Micro, Tech Data and Synnex. If the Round Rock, Texas, company were to bring on more distribution partners, Vitagliano said, they would likely be specialized.

"We've got it right today, but that doesn't mean we won't at some point change it. There are specialty areas where you might consider a specialty distributor," Vitagliano said from the Global Technology Distribution Council Summit in San Francisco this week, where Dell was awarded the council's Gold Rising Star Award for hardware revenue of $500 million or more in North America and Europe.

[Related: GTDC Chief: PC, Tablet Sales Woes Made For 'Miserable' 2015 Start For Distributors]

The award recognizes Dell's rapid growth in distribution, and it's also a nod to the company's evolution in that space, Vitagliano said. "We've made a concerted effort to expand our business with distribution," he said. Dell's distribution business is up "double digits" year over year, he said.

Still, distribution is an evolving business, and Vitagliano said Dell intends to continue to make major investments in part to work with distribution more efficiently, and to make it easier for distribution to work with Dell.

"For years, there's been discussion about the value distribution provides in the marketplace, and the truth is that the model is absolutely critical to the IT supply chain globally," Vitagliano said. "It's much more than pick, pack and ship. They've expanded their offerings tremendously, they've built communities, and they do an excellent job of connecting vendors with small partners in spaces that could easily get neglected."

David Wrenn, vice president of sales at Advanced Office Systems, a Branford, Conn.-based Dell partner, said having the flexibility to deal with Dell directly or go through distribution makes it easier for partners to get products. "If I need something and I need it tomorrow, I can get to Ingram or Synnex and get it," Wrenn said. "Would I buy servers through distribution? Probably not, because that's more of a project, but having both avenues does make it easier for us as resellers."

That flexibility is also important to Dell, Vitagliano said.

"Every [partner] has a slightly different business model, and conducts their business in a way that makes sense for them, and we support them all, but you need ways to supplement that," Vitagliano said. "Partners love having a direct relationship with the vendor, but we let them decide who they want to procure product from based on their business model. It's up to them, and that decision is one that's made on a transaction-by-transaction basis. It's important for us to be able to give them that choice."

PUBLISHED SEPT. 11, 2015

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