CDW Agent Program Faces Skepticism

DW’s new agent program may well be a sound alternative to similar plans offered by vendors, but solution providers that specialize in small businesses question whether the plan matches their needs.

The CDW plan, a pilot program called SolutionEdge that was rolled out in September, is targeted toward solution providers that do upwards of $10 million in product sales annually, CDW said.

But CDW Chairman and CEO John Edwardson noted that the program offers features that may be advantageous to smaller solution providers as well. He said CDW has almost 160 people with various technical certifications who can provide support to solution providers that may lack skills on some products.

“Many solution providers are very good in certain areas,” Edwardson said. “They may be a dedicated HP or an IBM provider. What we can bring to them is expertise in other areas. If they are competing against HP Direct, we can offer them IBM or Acer.”

Despite the extra support, Steve Harper, president of NMGI, a solution provider focusing on the small-business market in Hutchinson, Kansas, said he would be hesitant about bringing another company into his accounts. “My distribution partners aren’t selling to my accounts, why should I bring someone else to the dance?” he said. “My customers are my customers and not someone else’s.”

Terry Sharkey, president of National Tek Services, a solution provider in Mundelein, Ill., said agent programs such as CDW’s simply add another layer to the supply chain. “We already have the manufacturer, the distributor and us. Why should I buy from CDW?” Sharkey said.

She added that her relationship with the customer is the most important element of her business and she doesn’t want to put another player into that mix. “My gross margins on hardware are 16 percent,” she said. “If you can hold on to those relationships, you can make money on hardware.”

 Published for the Week Of October 11, 2004