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Non-Tech : Ingram Micro -- Ignore unavailable to you. Want to Upgrade?

To: JPM who wrote (296)	3/7/1999 11:03:00 PM
From: JP	Respond to of 576

This article should clarify a number of unfounded concerns... Dukes To Vendors: Beware Of The Channel''s Influence By Eric Hausman Phoenix 5:52 PM EST Fri., Mar. 05, 1999 .............. Reseller relationships with customers are the key to a successful business and vendors who think otherwise will find themselves losing share, said channel veteran David R. Dukes. Speaking before resellers at Pinacor Inc.'s Connection conference here, Dukes also said that Internet resellers are good for distribution. He saved his most critical statements for Dell Computer Corp. and Compaq Computer Corp. "Underestimating the channel is a strategic blunder," he said, while also joking that he can speak much more freely now that he is no longer employed by a channel company. "I get to say things now for which there can not be repercussions," he said. Dukes retired as vice chairman of Ingram Micro Inc. last year and is currently chairman of the Global Technology Distribution Council (GTDC). Dukes, who does not receive a salary in his current role, likened Compaq's flirtations with the direct model to Apple Computer Inc.'s strategy several years ago. As Apple began to sell direct and lose its close ties to the channel, the manufacturer quickly lost market share. The same thing could happen to Houston based Compaq, Dukes said. "The danger for Compaq is that they'll lose your trust," he said. As for Round Rock, Texas based Dell and what he called the myth of the success of the direct model, Dukes said 21 percent of all Dell sales go through resellers. "No one owns relationships like the reseller does," he said. And the direct model can not work, he said, because "there is no such thing as a single vendor solution on the market today." Dukes also highlighted the share of the white box market, which proves "the consumer is buying a relationship in which the brand is secondary." The market shares of Dell, Compaq and IBM Corp. combined is about equal to the share of the white box market, Dukes said. Therefore, it is imperative that resellers protect their relationships at all costs, he said. "And if branded vendors do not make an unwavering commitment to you, then embrace a supplemental white box strategy," he said. Dukes also touched on role of Internet resellers, saying their early success proves the importance of distribution. "Electronic resellers are totally dependent on distributors," he said. The GTDC has 15 distribution members and is self funded, which keeps it operating independently, Dukes said. Only chief executives and the No. 2 executives at companies may be members. It meets three to four times per year. In addition to speaking out on channel issues, the council is working on creating standards in areas such as electronic commerce, packaging and in reporting information to vendors.