Dell’s recent decision to go channel-first with its storage sales
will significantly increase the volume of business conducted via
partners. It may have raised some eyebrows in the industry, but the
announcement makes sense for many reasons.
A channel-focused approach will deliver Dell’s storage business:
Expanded market reach: Enabling Dell to tap into a
broader customer base via VARs, distributors and system integrators
that have established relationships and expertise in specific markets.
Specialised expertise: Channel partners possess
specialised knowledge about vertical industries, specific technologies
and/or niche markets. They will enable Dell to provide customers with
more tailored solutions and support, enhancing customer experience and satisfaction.
Cost efficiency: Direct sales models require
substantial investments in marketing, sales teams and infrastructure
to manage customer interactions and fulfilment. By using channel
partners, Dell can distribute these costs among its partners,
potentially saving costs and improving profitability.
Rapid scaling: An existing channel network could
expedite Dell's ability to quickly scale its business and expand
market presence without building everything from scratch.
Reduced channel conflict: By offering a
channel-focused strategy, Dell can avoid competing directly with its
own partners and maintain healthy relationships with them.
Risk sharing: Sharing the sales burden with channel
partners can help Dell mitigate risks associated with market
fluctuations, economic downturns or product-specific challenges.
Customer choice: Some customers prefer purchasing
through channel partners due to established relationships, value-added
services or bundling options. Dell can now cater to these customer
preferences and potentially capture a larger market share.
Cloud preferences: Customers are increasingly
adopting a cloud-first storage strategy. Channel partners can help
Dell meet this demand by lending their expertise in this space.
Dell's Partner First Strategy for Storage strategy will be good news
for its European distribution partners, since CONTEXT's Distribution
sales tracker in Europe shows storage declining -9.5% in Q2, after
+17% growth in Q1. CONTEXT's forecasts for distribution predict
further declines compared with a year ago in the final two quarters of
Howard Davies, CEO of CONTEXT, has posted about Dell's latest channel
move, which you can read
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