Channel programs News

A VAR's Tale of Discontent

Scott Campbell

“It was a nightmare,” said Zavala, a 15-year solution provider veteran who founded The Princeton Group in 2005. “The customer was waiting for the equipment and we kept getting false information. I was told every other day it was going to ship and it was en route.”

The customer, of course, was annoyed that The Princeton Group, Gilbert, Ariz., hadn’t gotten started on the project and even more so that there was no direct answer on when the equipment would arrive. Zavala himself was anxious that the customer, who he had won over after four years of hard work, could walk away from the deal.

It was only after Zavala notified his Cisco Channel Account Manager (CAM) on June 10 that he suddenly got some answers. The five Catalyst switches finally shipped on June 21.

Zavala said the Cisco CAM was able to do the impossible: get the products in question allocated for his customer.

“The Cisco CAM did a phenomenal job supporting a small VAR,” he said. “She made a miracle happen. She went to work and did some paperwork that expedited the shipment of the product. I can’t praise her enough.”

Pete Peterson, senior vice president of sales at Tech Data, said The Princeton Group’s complaint is an aberration and that supply chain shortages normally are effectively communicated to customers.

“The things he talked about are challenges distributors have. At the end of the day, it’s our responsibility to ensure the customer experience is a positive one. We have to manage through whatever internal challenges, process changes, resource challenges we face, as well as external or supply chain and manufacturing [issues],” Peterson said.

Peterson declined to elaborate on Cisco’s supply issues, saying, “We have had them with all of them [vendors] over the years at Tech Data.”

Luckily, there’s no permanent damage done with the customer relationship, Zavala said, and he has accepted Tech Data’s apology and promise to rectify the miscommunication.

In at least one instance, The Princeton Group has gone to the used or refurbished market for a Cisco product as a Band-Aid until new inventory in specific lines is available.

“I have a small customer base. My job is to find alternatives. If new inventory is not available, I have to look elsewhere,” Zavala said.

And that elsewhere may have to include non-Cisco vendors if the supply chain situation doesn’t rectify itself, he said.

“One of my customers has a buddy who uses Juniper. He was telling my customer he has no problems with inventory and prices are 30 [percent] to 40 percent less [than Cisco],” Zavala said.

To date, Zavala is sticking with Cisco because his customers have a legacy infrastructure with the vendor and starting over would be cost-prohibitive. But that could change, he added.

“We’re a Juniper partner but we haven’t sold much since we opened this business in 2005 because all my customers have Cisco. Unless it’s a brand-new sale or someone is experiencing these types of problems, replacing [Cisco is not easy],” he said.

“It becomes a disadvantage for smaller VARs. It happens all the time. If there’s a shortage of inventory, larger VARs get first grabs. In this particular case, I still had a good sized deal, but I couldn’t get the order placed.”

The Catalyst 4500 switches were part of a major upgrade that was providing his customer with a solution that would drive millions of dollars in new business.

“These [switches] were the critical ones, the pieces holding everything else from getting deployed. I’ve seen supply chain issues with other switches, but not to take seven weeks,” he said. “I hope Cisco can fix these problems in the next three to six months. If not, they’re going to lose market share.”

–STEVEN BURKE contributed to this story.

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