D&H's Dan Schwab: As Other Distributors Invest In The Enterprise, We Remain 'Laser-Focused' On SMB

D&H Distributing Co-President Dan Schwab said his company has no intention of following in the footsteps of competitors Tech Data and Synnex and acquiring its way into larger customer accounts.

"There's been a lot of changes in the distribution landscape, and more and more distributors are focused on the enterprise market," Schwab told CRN during the Mid-Atlantic Summer Technology Trade Show in Hershey, Pa. "While we're doubling down [on SMB], other people are taking those chips off the table and deploying them elsewhere."

Tech Data purchased Avnet Technology Solutions in February for $2.6 billion, while Synnex announced plans to buy Westcon Americas in June for up to $800 million. This will leave North America with just six distributors – including D&H – that have annual sales exceeding $1 billion.

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"Clearly, when you see who is being acquired in those first two [Tech Data and Synnex] examples, it's about the data center and the enterprise," Schwab said. "This is where many broadline distributors see growth and see margin and see their future, whereas we see our future as squarely, smack, right on SMB."

D&H is unique among distributors thanks to its free pre-sales and post-sales support, Schwab said, as well as a dedicated sales rep for every channel partner regardless of size. D&H's sales reps have, on average, been with the company for 10 years, Schwab said.

"We just keep evolving it [our support] and making it better," Schwab said. It's standing out to our customers that much more because it's not existing elsewhere."

Harrisburg, Pa.-based D&H serves as a trusted adviser, he said, helping VARs craft holistic solutions regardless of their size.

Channel partners that begin doing business with D&H typically find that the company's support is greater than anything they've ever experienced before, Schwab said. In the past, Schwab said some channel partners didn't know D&H since, as recently as a decade ago, the distributor didn't carry Cisco or Hewlett-Packard's enterprise computing products.

"If they already had great destinations, they never became familiar with us," Schwab said. "But more and more, people are seeing our value proposition."

Vendors have also increasingly turned to D&H for high levels of coverage and support around their small-business products, Schwab said. As many suppliers reduce their headcount, Schwab said they are often unable to support small-business resellers themselves.

"There are lots of other distractions and shiny objects that distributors can focus on," Schwab said. "We are laser-focused on SMB, and helping them move their business upstream."

D&H partners that traditionally sold to end users with between 25 seats and 100 seats are increasingly having clients with as many as 500 seats, Schwab said. As a result, D&H is offering its new hires far more training around advanced solutions, Schwab said, as well as gearing its webinars and training at partner trade shows much more around the "M" in SMB.

In fact, Schwab said D&H recently had 25 of its largest VARs come in for one and a half days of deep, intensive on-site training.

"We saw more and more of our customers having more advanced technical needs," Schwab said. "We saw our vendors bringing more complicated solutions to market, and we saw the opportunity for D&H to really make sure we fill that gap."

D&H has beefed up its field and office-based salesforce, Schwab said, as well as boosted the technical capability of its existing employee base. From a technical standpoint, Schwab said D&H sent some of its staff off-site for a week of highly specialized vendor training, while other workers have focused on gaining expertise around horizontal, multivendor offerings such as digital signage.

Main Street Software & Computers has been doing business with D&H for many years, and also holds accounts with all of the broadline distributors, according to General Manager Jim Roye. The Landisville, Pa.-based solution provider has found that D&H offers the most personal service, knowledgeable sales reps, and is able to provide answers to technical questions very quickly, Roye told CRN.

Although D&H's products are sometimes priced higher than other distributors, Roye typically finds that things get much more complicated when he attempts to work with a larger distributor.

Although other broadline distributors might have deeper pockets because of their large size, Computer Pros has found the experience to be less personal since they're unable to form relationships with credit reps, according to Josh Boyd, owner of the Nashville, Tenn.-based company.

D&H's sales reps tend to be pretty tight with the distributor's manufacturing reps, Boyd said, meaning that vendor-specific issues can typically be resolved quickly with fewer transfers between teams. And since D&H has less overhead than their larger counterparts, Boyd said he's normally found their prices to be better than the competition.

KM Computers has similarly found that D&H provides a nice personal touch, and is able to quickly resolve problems without a lot of red tape, according to owner Keith Miller. Miller praised D&H's credit team for being flexible and extending a little more credit if the Jeannette, Pa.-based solution provider is at risk of going over its credit limit.

"Everything's just a little easier with D&H," Miller said.