D&H Launches SMB Rebate Program
The Harrisburg, Pa., distributor unveiled the purchase reward program at its annual Mid-Atlantic Fall Technology Show, which attracted more than 1,000 resellers and 140 vendors to the Hershey Lodge and Convention Center, Hershey, Pa.
HP is the first vendor participating in the rebate program, but D&H expects other vendors to be part of the initiative.
Under what the distributor is calling its VIP Partner Program, VARs receive points on HP purchases that are redeemable toward up to 1 percent off D&H product purchases and up to 1 percent toward demo products. For example, if a solution provider purchases $200,000 in HP products, they would be eligible for a $2,000 credit on their D&H purchases and a $2,000 credit toward demo products that are discounted at up to 50 percent. That amounts to a rebate benefit of $4,000 in total for a $200,000 purchase.
The D&H VIP rebate program comes with a movement by vendors to more aggressively go after SMB sales in the wake of the enterprise IT market falloff.
Rob Eby, vice president of purchasing at D&H, said he sees more vendors shifting spending from enterprise to the SMB. "Instead of trying to sell upstream, they are trying to sell downstream," he said. That has helped D&H weather the economic downturn better than larger rivals such as Ingram Micro and Tech Data.
D&H Co-CEO Dan Schwab said that D&H's third quarter sales were up 7.9 percent and he expects even faster growth in the fourth quarter. In fact, Schwab said sales are up double digits in the last six weeks.
"Consumers and end users need technology," he said. "It's all about delivering the right product, the right solution and the right services. It's about adding value and giving the business or the consumer reason to invest in that value."
Schwab said the key to success in the fourth quarter for solution providers is driving business not just on price, but the "value proposition that satisfies business or customer issues or challenges."
"You've got to work harder and smarter," Schwab advised. "There are a lot of great new technologies and opportunities for business to run more effectively. You need the old-fashioned roll up your sleeves and differentiate yourself in the market mentality."
While many vendor rebate programs are focused on larger midmarket solution providers, Schwab said the VIP rebate program is focused squarely on helping SMB solution providers be more profitable. "This is a program for the VAR that does only a couple of million dollars in annual sales," he said. "These are VARs using D&H as their primary source of product information. We are their trusted adviser."
Among the offerings that Schwab is excited about in terms of driving sales growth is Microsoft's Windows 7 operating system. "We think it's a big product that will exceed expectations in a market that is ripe and ready for the opportunity," he said.
Schwab said he sees Windows 7 as more of a consumer sales opportunity for the fourth quarter, but he sees it as a big driver of business for solution providers in 2010. "It provides a conduit for the reseller to drive the upgrade cycle," he said. "It will lead to security, network or multiple other technology sales. It's a catalyst."