WeP Peripherals—eSys tie-up: Channel has mixed reactions

WeP Peripherals' recent decision to sign on eSys as its
national distributor has evoked mixed response from its partners. Though,
resellers have appreciated the vendor's move to go with a national distributor
to increase volume and reach, they also admitted that their loyalty with the
company would come down. They added that volume business is the order of the day
and WeP Peripherals cannot be an exception to it.

“Everyone wants to be with everyone-right from a vendor
to a distributor to the channel partner-to increase their business and
opportunities. The market dynamics are such that you cannot be with a single
partner/vendor and grow your business. But, one needs to create a right and
balanced ecosystem to give/have enough space for growth,” said R Mahesh,
Director of Coimbatore-based Ozone Computer Services. He also stressed that
brand pull is very important in today's highly competitive world.

RAM AGARWAL: Not compelling dealers to buy from eSys and channel policies will remain the same as it was before eSys was appointed as national disty

It is worth mentioning here that TVS Electronics, a
homegrown company similar to WeP Peripherals, had gone in for national
distribution as early in 2000. HCL Peripherals has also recently tied up with
Ingram Micro to distribute their display products. It's the way everyone has
to go if they are looking for volumes. However, the success of these companies
in the volume game is largely dependent on the pull they create in the market.

According to WeP Peripherals' dealers, WeP is more a push
product than a pull one. Its strength is its resellers, who have been associated
with it for many years. “A national distributor would not take the kind of
risks a WeP dealer is taking in business. He is more of a logistic partner than
a value-addition player. WeP has taken a wrong decision by signing up eSys and
in the process, they will lose their loyal partners in business,” said M
Srinivas Rao, Director of Hyderabad-based Necx.

WeP Peripherals has however clarified that the company is
very much committed to its channel's growth and profitability in business.
And, the eSys tie-up has been undertaken to expand its reach (mainly in
unrepresented areas) and capacity in the market.

“We have never asked our dealers to buy from eSys and the
channel policies remain the same as it was earlier. We will also be fair on
pricing for both eSys and our dealers, irrespective of the volume they take.
Overall, we see eSys as an additional regional distributor across the country
than a national player,” said Ram N Agarwal, MD and CEO, WeP Peripherals Ltd.

He also clarified that WeP is not a push product and said,
“WeP has its own brand equity in the market, which has survived us through the
years.” The company is expecting to increase its sales by 10-15% on total
volume, with eSys tie-up.

“There is no compulsion to buy from eSys. We are
comfortable dealing with a WeP Peripherals reseller here because they also do
business with us. In the case of the distributor, we cannot expect this,” said
C Balakrishnan, Chief Executive of Erode-based BCS Hardware Division.

“As long as the service support and backup are good, we
are ready to buy even from a national distributor,” said R Murthi, Director of
Imperial Computers, a leading consumables partner for WeP Peripherals in Erode.

“The eSys tie-up is a welcome move as it would help the
stock availability for the dealers. But, WeP should make sure of protecting the
channel partners' interest in business. The company should also work towards
creating a brand image and pull in the market,” said K Ratnaji Rao, Director,
Mist Computer Services, Vijayawada.

Noted Nalin R Patel, CEO of Bangalore-based Ankita
Electronics, which has been with WeP Peripherals for the last 14 years, “It is
purely the company's will to go with national distributor. But it should not
have done it during the fiscal end. Though, WeP Peripherals is known for its
channel-friendly policies, they have taken a wrong decision by appointing eSys
as their national distributor, which has certainly disturbed the loyal
partners.”

S Gopikrishna