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D&H Co-Presidents On Standing Out Amid The Tech Data-Synnex Merger: ‘We Are Like Evolution Versus Revolution’

‘When you have big mergers, a lot of times there are big revolutions. There’s a lot of major changes that have to occur. We like to have lots and lots of little tweaks, survey our customers monthly about what’s important to them, about how we can serve them better and lean in on service,’ says Dan Schwab who, along with his brother Michael, speak to CRN about the merger and a host of other topics.

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This is an interesting time for distribution, with mergers and acquisitions by private equity. How is that impacting the distribution business?  

Michael Schwab: Inevitably, through attrition and mergers, the remaining distributors have gotten stronger. And, I would argue, with barriers to entry today so high, getting the vendor agreements and customer relationships in place, getting the IT systems in place, setting up a whole distribution network and having all that run at very low-single-digit operating costs, it’s a monumental undertaking that takes decades to build out.

So I think we‘re at a point in time here where the distributors that are left are resilient. They’ve proven their merits in the marketplace, that they have value-added structures that resellers aspire to have strong relationships with. And distributors perhaps have become even more relevant to the marketplace than ever before.

But one of the things that could change is how vendors now look at their distribution partners. Do they perhaps now through consolidation have too much of their business going through one or two sources into the marketplace? And the theme of, ‘too many eggs in one basket’ might prove out here as business consolidation continues.

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