Dell Partners Benefit from Expanding Product Lines and Supply Chain
Partners ‘switching allegiance’ to Dell Technologies on double-digit product line growth, healthy discounts and supply chain predictability as channel pursues aggressive market gains after the pandemic.
From India to New Zealand – and all parts of Asia-Pacific and Japan (APJ) – the ecosystem prioritizes financial profitability and solution delivery above all else, while markets are emerging from the shadow of COVID-19 driven by a desire to grow rapidly.
That’s according to Tian Beng Ng – senior vice president and general manager of APJ channels at Dell – who suggested that such a drastic shift in partner approach – after 18-24 months of unpredictability and difficulties – resulted in record -breaking channel revenue for Dell both globally and regionally.
“If you look at market growth, we had a very good year,” Tian Beng said, speaking to Asia Channel the margins of Dell Technologies World in Las Vegas.
From a global perspective, the provider’s indirect business grew by $21 billion in five years, growing annually from $38 billion in 2017 to $59 billion, the fiscal year figures 22 showing annual growth of 27%.
Closer to home at APJ, retail activity has topped global figures to grow 31% over the past 12 months, triggered by double-digit growth across all product lines.
Notably, customer sales increased by 41%, while servers and storage saw increases of 39% and 14% respectively in the region. The impact resulted in Dell paying an additional 42% in partner discounts.
“These are huge numbers in the APJ,” noted Tian Beng. “We all know the reasons for customer growth, but the growth in the server business is particularly huge.
“There are several factors behind this, but one big sector that has grown is web technology, which is understandable. During the pandemic, guess which company grew? Everything and anything connected online. Everyone has turned to online and because of this, web technology has taken advantage.
In addition to web technology, Tian Beng acknowledged that after a period of market instability in which companies delayed decisions on data center projects, this hesitation has been eliminated and deals are back. on the table.
“We noted a resurgence that started in the first half and accelerated in the second half and the peak continues to rise,” he noted. “One area of the distribution business that we are very pleased with is that our partners are doing well, as evidenced by the fact that we are paying 42% more rebates year over year.
“It’s a good sign because our overall distribution business grew by 31%, but we paid out 42% in rebates, which shows that partners are making money across our entire portfolio in APJ.”
Product Line Growth Triggers Attractive Discounts
These strong partner returns are expected to continue in the coming months, with technology spending expected to reach $1.04 trillion across Asia-Pacific in 2022, at a growth rate of 5%. According to IDC, clients are increasing or maintaining investment levels despite supply chain concerns, inflation, labor shortages and COVID-19 variants.
Spending is expected to cover all aspects of the technology suite, from devices to data center and cloud, a dynamic market that Tian Beng said best positions Dell partners for future growth.
“The more partners that sell the right mix of products and more lines of business, the more discounts we pay the channel,” he added. “It’s positive and means that partners are increasingly end-to-end and adopting the right behavior to win in the market.”
For Tian Beng, cross-selling is the channel’s secret weapon with triple-digit rewards for selling across Dell’s portfolio, ranging from client, server and storage solutions to VMware offerings.
“We have customer partners only, but it’s a little oversight,” Tian Beng said. “Most systems integrators understand that to survive long term, they need to sell into the data center space.
“If they exclusively sell the customer’s product line, it will be very difficult to survive. Perhaps in more emerging markets such as Nepal or Bangladesh, this approach might be feasible, but for the majority, the payoff lies in the data center. »
As markets rebound at different paces, Tian Beng also pointed to the potential of APEX — the offer as a service of the supplier — to help partners capitalize on the growing demand for data center solutions delivered through a subscription-based model.
“It’s just the beginning, but the whole consumption pattern shift is taking off across the region,” Tian Beng said. “We believe our APEX offering is differentiated because we can provide this service end-to-end. We start with activation and add product lines as we grow. »
As noted by Tian Beng, two APEX offerings currently exist in the market: Custom and Outcome.
“Custom does exactly what the name suggests in that it’s a customizable offering designed from the ground up,” he explained. “The offering is Flex-on-Demand and Custom is now available in Singapore, Australia, India, Japan and Korea — we have already deployed this solution.”
Meanwhile, Outcome again follows name implication and is focused on delivering an outcome-based solution aligned with specific client requirements.
“For example, they can access the APEX console which allows customers to click on environment, bandwidth and capacity features and then purchase this service based on the result,” Tian Beng said. “This is currently only available in Australia and Singapore, but we are rolling out more.”
Specific to consumer-based selling, Dell has also introduced managed services for cyber recovery in an expanded APEX portfolio, supported by enhanced partnerships with Microsoft, Amazon Web Services (AWS) and Snowflake targeting public and multi- cloud.
Under the Dell APEX Cyber Recovery Services banner, the move is the first in a series of new end-to-end solutions to be housed in the vendor’s product suite as a service, with the goal of simplifying post-disaster recovery. cyber attacks. .
Specifically, Dell will manage “day-to-day” cybersecurity recovery vault operations and assist with data recovery, leveraging standardized configurations and expertise from nearly 2,000 deployed isolated vault solutions. in the world.
“We are seeing a mix of security skills across the channel,” Tian Beng noted, referring to the market’s potential to pivot toward security. “But it’s a priority for partners because of the environment and we’re seeing more focus on cybersecurity and cyber resilience.
“Partners want to start selling now and if they don’t have the necessary skills, they can work with us to help them get started. For example, a partner recently rolled out one of our largest cyber resilience projects in the Philippines, so we’re seeing strong examples across the region.
Supply chain predictability wins contracts
Despite the allure of increased customer investment and increased cross-selling opportunities, the overall market remains hampered by ongoing supply chain disruptions, shipping delays and backorders undermining the progress of projects.
Unsurprisingly, supplier superiority in the supply chain provides an attractive asset to a customer and partner base stuck with long processing times and delivery dates.
“We were able to accurately predict delivery times much better than our competitors, so I would say yes, our supply chain would have definitely helped us win contracts,” Tian Beng said.
“When new partners come to Dell who have not worked with us in the past, our goal is obviously to retain them and motivate them to continue to do business with us and increase our market share.”
According to Tian Beng, the channel growth achieved in the past 12 months is directly related to cross-selling from current partners to expand investment opportunities, in addition to new partners joining the supplier’s network in authorized capacities and gold status. .
“They’ve changed allegiance and we want to make sure we keep them in the Dell ecosystem,” he said.
Looking ahead to FY23, Tian Beng cited three key areas as critical to supplier channel success – transactional, transformational and experience – with a desire to focus on winning deals, changing the game and improving experience levels.
“Transactional focusing on running the business and selling more devices, storage, servers and modernizing the data center,” he noted. “It’s more table-top business that we need to do to make sure we continue to grow and outpace the market.”
The next pillar is transformational and focused on “breakthrough” initiatives such as APEX, in addition to an increased focus on Independent Software Vendors (ISVs) and Cloud Service Providers (CSPs).
“These new initiatives will really change the market over the next few years,” said Tian Beng. “Results may not be immediate – which is why we need the transactional element of the business – but these efforts will be a game-changer.”
Specific to the experience, Tian Beng referred to a simple goal; “to make it as transparent as possible for partners to do business with us”.
“It’s a key aspect of working with the channel and one of the most consistent feedback we get from partners,” he said.
“How can you facilitate our business relationship with you?” We are constantly working to address these feedback, such as providing faster quotes or providing self-service tools to eliminate the need to speak to a Dell representative, instead partners can simply log in and get their own quote and place an order.
James Henderson attended Dell Technologies World as a guest of Dell.
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