DQCI-XEROX FIVE-CITY PANEL DISCUSSION: Making Business Future-ReadyÂ

Panelists had one single-most important suggestion to make–keep one’s business ready for tomorrow. Many emerging technology areas were identified, views on how to improve one’s business were also exchanged.

It is time for solution providers to look beyond competition by identifying
newer avenues for growth and profitability, and upgrade themselves for future
business opportunities and provide value-added services.

This was what came out strongly during the five-city ‘Emerging Business
Opportunities’ series of panel discussions organized by Channels India, in
association with Xerox Modicorp. The event was rolled out in Chennai, followed
by Bangalore, Mumbai, New Delhi and Kolkata.

The theme of the discussion was initiated to deliberate over and identify
growth areas for partners. The event attracted distinguished panelists from
across the country, comprising vendors, sub-distributors and solution providers.

"Take time to think and conduct regular audits of your revenues and
profitability. Never succumb to pressures from vendors/distributors and do what
is good to you," exhorts Asim Raina, Executive Editor, DQ Channels India.

Partners who attended the event listened attentively to emerging opportunities in newer businesses. Attendees admire the array of Xerox products on display at the event.

He also urges partners to look for opportunities in newer business segments
like storage, Wi-Fi, storage management software, network management, facility
management, security and so on, where margins are higher. "Also, provide
value-added services to your customers to retain them and strengthen the
relationship," he adds.

CHENNAI

According to Rakesh Jain, Director, Supreme Computers and a panelist at the
Chennai event, Diversification can be a better option provided one understands
their core strengths in business. "There are more opportunities in the
existing business line which one should tap before getting into new areas. Keep
your options open but identify your strengths in business," says he.

"Never take any order which is not going to earn margins for you.
Bottomline is more important than your topline for sustainability and growth in
your business. Also, keep looking for new opportunities and enhance yourself to
meet the demands," says Johnamalraj, MD, Skylark Information Technologies.

Diversification can be a better option provided one understands their core strengths in business. Upgradation of knowledge base on investment on reskilling is a must for partners.

"Provide end-to-end solution to your customers and for any requirement,
the customer should contact only you. A channel partner should be one point
contact for customer’s all requirements," advises Girish Madhavan, CEO,
Quadsel Systems. He also points out that vendors/distributors are not committed
to their partners and keep increasing their channel base, bringing too many
players in the fray leading to unhealthy competition.

However, S Ravindran, GM (Operations), Ingram Micro India counters this
statement saying distributors would evaluate a channel partner on various
parameters before associating with him in business.

BANGALORE 

Leslie Lean, MD, Ansata Computer Systems, recalled the role played by
channel associations in bringing together the reseller community. He felt that
the associations should play a greater role in educating solution partners on
the latest technologies and business opportunities in the local market.

"Resellers should also take time to think on the new developments to
upscale to solution providing. All pull-driven products are bound to cut-down
margins and to move to the next level, we should not be shy of technology,"
he added. Learning basic technologies and running a comparison test for customer
can bring more business for a partner, he felt.

Resistance to change is a major impediment for channel’s growth and
success. R Sridhar, Director, Triangle Technologies noted that a reseller should
move away from box-pushing and try to build solutions and provide value-added
services.

On dumping of products by suppliers, Ramana Rao, Branch Manager, Ingram Micro
India, Bangalore said, "Partners should spread their purchases over a month
instead of making bulk-purchase at the end of the month." Moreover, he
noted that they should make use of the distributor’s logistics to leverage
their business with multi-location delivery, besides using the credit facility.

Anand Rahalkar, Director (Channels), Xerox Modicorp, felt that the this is
the right time for markets to move up the value chain. He stated that unlike
other vendors Xerox did not want everyone to sell its products and bring
unhealthy competition. "We want select partners who could address the
market well with our right product mix. This shows the level of our commitment
to the the channel," he added. Anand also noted that this approach is
precisely what has helped the company garner 30% marketshare in MFDs.

MUMBAI

The panelists in Mumbai comprised of a heterogenous mix of SIs,
sub-distributor and distributor. The panel comprised of Avinash Pitale,
Director, Omnitech Infosolutions; Rajiv Sethi, CEO, Liberty Automations; Hitesh
Mody, Director, Jaydee Electronics; BK Mitra, Sr Manager-Sales (Western region),
Ingram Micro and Anand Rahalkar from Xerox. Iishwar Daas Nair, Bureau
Chief-West, Dataquest, moderated the discussion.

According to Avinash, for a long time the industry had been product-oriented
and it is only in recent times that solution and service-driven businesses have
caught up. "From our perspective, it is the ability to offer an end-to-end
solution and best meet customer needs is what we see as the most emerging trend
or opportunity in the days ahead," remarks he.

For this he, said upgradation of knowledge base on investment on reskilling
is a must for partners.

BK Mitra offered a different take on the subject by opining that in future,
solution itself would take the shape of products. In due course of discussion,
Iishwar asked the audience whether it makes sense at times for partners to push
products not from #1 vendor but from the #2 player. The panel as well as members
of the audience agreed on this saying that by sticking to #2 player, partners
can "get something extra from that vendor in terms of quality, value-add
and so on," says Hitesh.

Service is one area where one would find maximum bad debts. Associations should play a greater role in educating solution partners on latest technologies and business opportunities locally.

It was in this context that Anand urged the audience not see printing just as
a paper going inside and coming out with a print. "There are many more
functionalities to address a wide range of business needs which printers/MFDs
offered by us can provide. And so these make up for a wide range of business
opportunities for partners to lap up," added he.

Rajiv said that by focusing more of push products, a partner has a better
prospect of improving his profitability. "When you take efforts to sell a
product, you have the option of charging a premium on it as well, which is not
the case with pull products," pointed he.

A good amount of deliberation also happened on B and C-class cities opening
up a host of new opportunities. However, the panel seemed to be divided on the
issue. "In SOHO segment and too an extent in corporate as well, there’s a
good opportunity exists in cities apart from metros. If this is backed by a good
service support, the business can really yield good results," opined Rajiv.

While agreeing with Rajiv on the subject, Hitesh cautioned that if a partner
is expanding to B and C-class market just because his margins are lowering in
metros, than its the worst mistake he would be committing. "In a hope of
earning better margins in B and C-class cities, you might only be running away
from the real problem of shrinking margins in your current business," added
he. Even issues like warranty support, credibility and payment terms can
continue to be roadblocks in one’s upcountry endeavors.

"Even in these upcountry markets, the local players there itself have
become very strong and are doing phenomenally well. So the question that needs
to get answered is what different can you offer," remarked Avinash.

The panel also agreed unanimously on the need to ensure bottomlines more than
the topline. "Let’s work the nitty-gritty of our business, do the maths
and see if we are being profitable on a daily, weekly, or monthly basis. We need
to create a monthly balance sheet and work out our profits and loss,"
articulated Hitesh.

DELHI

As part of the panel in Delhi, Xerox’s Anand remarked that partners should
only approach to sell those technologies which they are comfortable with
rather than selling technologies which demands such expertise that they
might not be having.

Prasanto Kumar Roy, Chief Editor, DQ Channels India moderated the
discussion noted that inn the present scenario channel partners cannot be mere
box pushers and that they need to either have some expertise  in
services or should go and sell those technologies which would give
them better margins. The other panelists present on the dais were
Rajesh Aggarwal, CEO, Micromax Technologies, Saket Kapoor, CEO, Computer Vision
and Gurjeet  Singh  Kohli, Director, OA Compserve.  Also was
present Anand to offer Xerox point of view in the discussion.

He said that presently  more resellers were selling low-end
products whereas better margins were in high-end products. "It is very
important that a partner understands intricacies of the product before he
goes out to the market because that would give him the edge when he
sells it to the users," advised he.

Rajesh said that every reseller should understand that it is the
push product that gives better margins but at the same time does not
mean that one should not be associated with the pull products.  "Pull
product gives the resellers identity and the push products provides them
margins. So it is necessary that partners should  have the right mix of
push and pull products in

their kitty."

Prasanto pointed out that wireless is one such area where growth
potential is immense but it is moving at a very slow pace in the country.
"I feel that wireless would be the order of future and there is no
doubt that partners need to enhance their skills with the newer technologies as
that would ensure better sustainability for them," opined he.

Agreeing to  what Prasanto  said, Gurjeet commented that since
indoor usage of Wi-Fi is freed from licensing, lot of activities can
be seen on that front.

Service was another issue  that  came out as a hot subject of
discussion. It is known that today more and more partners are getting
associated with after-sales support, which ensures good bottomline for
them. However, at the same time, partners needs to ensure that they have
sufficient infrastructure to support their service initiatives.

Saket pointed out that service is one area where one would find maximum
bad debts. The reason being is that if any partner is not providing
satisfactory after-sales support, customers are not willing to pay. "I
feel  that only those partners should get into service business who
have  strong base in it and who are willing to spend on trained
manpower," suggests he.

According to Gurjeet only those partners would be able to make better
margins who posses better technical knowledge as without that business in IT
will get more difficult as the days go by. "I feel that it
is very important for partners to devote more time on technical
expertise to sustain in this business," he adds.

To end the panel discussion Prasanto asked each of the  panels which
they feel are the hot areas in IT where channels  partners can invest in
the future.

Saket felt that network  security is  going to be one of the most
favored areas in the future as penetration  of Internet is increasing day
by day.

Rajesh pointed out that digital imaging and printing is going to be one
of best areas to invest for the channel partners.

Lastly, Gurjeet mentioned that networking, printing, laptops, MFDs
and wireless are some of the areas, which is going to take the center stage
in the coming years.

TEAM DQCI