Distributors let down Goan partners once again

Margao, Goa

October 22nd, 2007

"They are rude and arrogant", "We have to beg them to pay
attention to us", "They don't care about us", "We would
rather do business with large sub-distys than ever approach distys, even if we
have to pay a higher price to the former" - these are some of the comments
that came out from a highly disgusted Goan channel community at the IT Panchayat
held in Margao last week.

And it is not hard to believe their words, because barring Ingram Micro
India, no other distributor's representative made it to the even, which is a
forum for partners to discuss issues which affect them with distributors.
Dealers in the city felt that distributors are apathetic to their and a classic
example of it was their no-show at the IT Panchayat.

Earlier this year, when the IT Panchayat was held for the first time in Goa,
no distributor had turned up for the event, which had antagonized a lot of
dealers. In fact, the local association had decided to discontinue trading with
the distributors, till the senior management stepped in and assured them that
distributors would be more proactive henceforth. Now, the partners feel that the
same distributors have slipped back to their earlier complacent behavior.

Things have come to such a stand, that dealers have now started buying from
large sub-distributors in the city, than buy from the distributors, even if it
means having to pay a little more for the same product. Partners also felt that
this status quo benefits the distributors as well, because their targets are
met, which is why they prefer doing business with a few sub-distys than try to
expand their channel network.

"Once when I went to a distributor to buy one unit of a product, I was
told that the goods were not available. And a few moments later, right in front
of me, I saw several units of the same product being bought by another dealer.
This simply means that unless I place bulk orders, distributors are not
interested in trading with me," complained Prashant Naik of Data World.

Ram Nair of PC Clinic commented that he has had similar experience with
distributors and felt that their behavior was highly high-handed. "It is
humiliating to go to them for a product and be told it is not available and then
find a lot of those products with some other dealer later in the day," he
complained.

To this, Terence Viegas, Branch Manager of Ingram Micro India responded that
this was not true of his company and he could not comment for other
distributors. But Nair questioned, "Then how is it that when I call you,
the call goes as a missed call and the bigger dealer can call you at 2am and ask
you where you are? Why this difference in response?"

Partners also mentioned that there were instances where the distributors bill
to end customers. Said Naik, "There is a dosawala in my area who sells
printers. How could he have registered himself with the distributors who
otherwise ask for all company details. This means that distributors are
willingly selling to end-customers, using a loophole in the system."

And the loophole is that distributors will sell to anyone who can furnish
some details about his company. Partners suggested that to plug this loophole,
distributors should stop selling to dealers who have not made any purchase for a
long period, because there is a good chance that only end-customers will make
one time purchases. But Viegas said that there is no process to un-register in
Ingram, at least.

Product knowledge lacking

Reuben Quadros of Texel Computers felt distributors should know the product
portfolio they carry. Viegas countered that Ingram had a pre-sales team which
was technically qualified and which works with the partner to interact with
customers. "We know about our inventory and the end of life products, but
it is not possible for us to know the details of the technical specifications of
various products. That is for the dealers to know," he said. However,
Quadros quipped that there were instances where distributors were not even aware
of the models that they carry, but there were no other distributors who could
counter this claim.

Partners also suggested that distributors should line up product technical
seminars so that partners are able to revert to customer queries as well. This,
they claim, is not happening in the city.

What is compounding the problems of the dealers in the city is that dormancy
of its local association Goa IT Business Association. Partners lamented that no
meeting has taken place under the aegis of the body and there is no interaction
with the executive council members.

"There is no activity that is being planned or any issue which is being
resolved by the association. We don't even see the point in being a part of the
association," said another dealer.

To this, Balakrishan Prabhudesai, who is the current president stated that
there is no active participation by partners themselves and they don't come to
any meetings that are organized. "Unless the partners show some interest in
the working of the association, we can't do anything," he added.

It is quite likely this fragmentation in the channel community in Goa, which
is the reason why they have to battle individually for their problems. This
could also explain why distributors' do not fear incurring their wrath for any
wrongdoing or not sticking to their commitments.