Keeping the System Builder Channel Healthy w/ Todd C Garrigues

THERE HAS BEEN A LOT OF TALK RECENTLY about the state of the system builder channel. Yet all the data points to the fact that the system builder channel is healthy. That is, some system builders are growing, some are shrinking, and some are staying the same.

To experience growth, system builders need to look at their customers’ businesses in a new way, because that’s where they can offer the most value. The role of the PC in small and midsize businesses is changing, and system builders need to understand what their customers are doing, what they want to do, and what they should be doing with their PCs. There is a real opportunity to educate and influence those customers in new areas of technology. 

MAKE SOME CHANGES
This requires that system builders make changes as well. Look at your market. If you’re losing business because of tier-one ads on TV or catalog sales, differentiate yourself. That has always been the hallmark of successful channel players. What are you doing that’s unique? What is your value add?

Sometimes differentiation comes from offering the latest hardware revisions. You were building X, and now you’re building Y. Vendors have an obligation to ensure that their partners are aware of, and well educated about, their newest offerings. Vendors also have to make those new products or revisions readily available to providers.
Once you’ve viewed the market in this way, you need to look at what else you can do to improve your bottom line. What other products or services can you offer? If you’re not offering storage, for example—even a small NAS box or setting up a RAID on a couple of drives—could you be?

If you’re in the classically defined PC channel today, you’re most likely building customized desktops, providing some server technology to your small business clients, and reselling notebook computers. When we ask our partners what percentage of them are offering storage solutions, it’s a small number. If we ask them about managed services, again, it’s a low percentage. Those two examples may be interesting opportunities for the future.

With storage, however, you are not only linked to your client’s infrastructure, but to his or her data. If a PC goes down, there’s a simple fix. But if the client loses storage, that’s a lot more daunting. Vendors have to do a better job of teaching system builders how to deal with those situations. That may mean partnering with other large industry players that have the experience to educate the system builder channel in this regard. Maybe it’s a new level of service and support or a deeper level of training—not just how to build it, but how to sell and service it. Distributors are also playing more of an influential and educational role. They often know which parts are a good fit, which software to use, and generally what works and what doesn’t. In addition, many distributors are investing more in technical and service training.

So as you choose new products or services to sell or decide which components to build, look at the vendor and distributor communities to determine who is going to provide you with the best level of education, service, and support. It’s about partnering. To get into new markets and develop new revenue streams, you need to choose well.

TODD C. GARRIGUES is the North American channel manager at Intel, a world-leading technology company with revenues of more than $30 billion.