Vendors ignoring upcountry partners

Allahabad

July 24th, 2007

The IT Panchayat, organized by The DQ Week, held in association with Hitachi
Data Systems, Amconics, ICICI Bank and Tutis Technologies, made a stop last week
at Allahabad. The event witnessed some candid talk by partners and some serious
discussions of problems plaguing them in the upcountry region.

Shivshankar Singh, President, Allahabad Computer Dealers Welfare Association;
Manish Mehrotra of Tritech Enterprises and Siddharth Sharma of Konark Computers
represented the panel. Raheenul Hasan, Area Sales Manager (Components),
Redington India Ltd and Updesh Singh, Senior Sales Associate, Ingram Micro India
Ltd represented distributors. Shivangi Yadav, Executive Editor, The DQ Week
moderated the discussion.

Starting the discussing Shivshankar Singh said that vendors did not back up
the channel in the upcountry areas. Giving details he noted, "While vendors
are happy dumping their stuff on us, there is no after sales service available
by any vendor in the upcountry region." Agreeing with him Rakesh Srivastava
of City Compac Systems said, "Even if one laptop or machine develops a
problem, we have to take it to Lucknow, because there is absolutely no service
center here."

According to Mehrotra another major problem that partners in upcountry face
is the DoA and short shipment. Explaining this situation Mehrotra said,"
While most vendors might have a policy on DoA there is no policy whatsoever on
short shipment." Replying to the same Hassan of Redington said,
"Distributors have no say in the DoA cases. Most vendors have a policy and
these days there are no outstanding cases beyond 10-15 days now. However, I do
agree that as of now there is no short shipment policy with any vendor or
distributor and that this is something that needs to be looked into."

Raising the issue of missing parts in packaged and sealed goods Sharma of
Konark Computers said, "There have been instances where people have opened
sealed packages and there have been parts missing, like hard disks etc, from the
machine and no one is ready to take the liability." Adding to that another
channel partner from the audience stated, "These things happen very
frequently in the upcountry markets especially in Allahabad. Such instances of
missing parts damage our credibility in front of the customer, and there is no
one to listen to our claim. If this happens in Lucknow, the partner can get a
change immediately as the distributors have offices and personnel there. In a
city like Allahabad, that is not the case since the big distributors have no
representatives here."

Replying to this Hasan said, "The distributor is not the only one
responsible for this. There are many people involved in the entire process,
whether it is distributor, the courier person or sub-distributors or channel
partner's person in the warehouse. So the accountability has to be first fixed.
However, as of now no one has a policy on the same."

Many channel partners raised the issue of price undercutting that is
prevalent in the market. They were of the opinion that the vendor or the
distributor should have one standard price for products in the market. Deepak
Aggarwal of Matrix said, "The price undercutting is such that sometimes the
difference between the printed price and the one that it is sold is almost Rs
3,000, so with everyone giving a reduced price the customer thinks that he could
have gotten a better deal and that hits our credibility."

Replying to this allegation Singh said, "Price undercutting has become a
fact of life and the prices have come down so much now that there is no
undercutting left." However, since most partners present vociferously still
pursued the subject and wanted the association to get involved both Singh and
Mehrotra agreed that they would consider making a committee to look into the
matter and set out prices on which all partners would operate and strict action
would be taken against those who do not adhere to the same.

The evening, which saw participation of around 80 channel partners, also had
presentations by Sanjeeo Singh, Relationship Manager-Northern Region, Hitachi
Data Systems and Ashish Priyadarshi, Branch Manager-Lucknow, Amconics.