Guest Column | February 9, 2009

Take A Hard Look At Your Business. If Not Now, When?


Written by: John Black, president, Catalyst Telecom

Efficiency is the name of the game today. With a sluggish economy, revenues going the wrong way, and the need to better justify spending, it’s imperative that dealers take a hard look at their business to see where they can cut costs and become more efficient. The use of a value-added distributor is more important (read: economical) for dealers than ever.

The bottom line is this: Dealers need to be focusing on sales, customer service, and marketing while looking to delegate other non-core services to their distributor. It all begins with a close examination of core processes and an evaluation of where dealers can reallocate personnel. Through this reallocation, natural attrition, and delegation of non-core services to a distributor, dealers can save money, improve their cash flow, and create efficiencies in the back office.

So what kinds of services can distributors offer? From the simplest to the most complex. Professional services are a key offering that some distributors provide and dealers should certainly be taking advantage of. From network assessments and system integration to remote programming and end-user training, professional services help dealers with all facets of their end users’ implementations. The time taken out of the process by allowing a distributor to manage many of these services can greatly increase the dealer’s cash flow, as it can get paid more quickly by its customers. And again, the dealer can focus on new sales while the distributor manages the rest.

To that end, technical support and design assistance are also areas in which a distributor can help ease the burden. Dealers either have to develop these skills themselves or they often have to tie up designers to manage technical calls instead of being focused on growing sales. To be able to off load this service to a trusted distributor that has the necessary skills and training is extremely beneficial to the dealer.

Another very important service that dealers can allow a distributor to manage is vendor services, which can include contract preparation, quoting, and configuration. Distributors (should) have a strong relationship with their vendor partners, enabling distributors to easily and more quickly complete the necessary forms and projects. Distributors can deliver these services for free or at a significantly lower cost than dealers can do on their own.

And certainly, dealers can’t forget education and training opportunities, which are essential in helping improve sales and marketing capabilities and enhancing the caliber of their sales force. Some distributors will even take training on the road to their dealers, which is especially valuable during a tough economy when travel budgets are tight.

Even more important during economic struggles is the availability of creative financing options, from joint POs to assignment of proceeds and other customized options. Dealers need to search for a distributor that can help them be more flexible with customers. It’s all about an ease of doing business — from the distributor to the dealer and the dealer to the end user.

Now more than ever, dealers need to closely examine their business and ensure they are taking advantage of current partnerships and creating new ones where possible. A value-added distributor is equipped with the skills, relationships, and training to help dealers focus on sales and marketing, enhance customer relationships, and, most importantly, grow revenue.

John Black, president, Catalyst Telecom
John Black has served as president of Catalyst Telecom since April 1999. Black joined ScanSource in 1998 as president of Catalyst Commerce, the division that developed and managed e-commerce programs companywide. Prior to this, he was with IBM for 17 years in sales and management.