Ingram Micro joins a list of Acer distributors which also includes IT Wholesale, Alloys International, Compu Wholesale, HiTech, BlueChip IT, Express Online and Digiland.
Acer has gone full circle on a strategy it first employed two years ago when it sacked its distribution channel in favour of a direct channel partner model.
The Ingram Micro deal would drive growth in sales to the SMB market and the distributor would be focusing heavily on Acer's storage area network (SAN), networking, PC and server products, according to Greg Mikaelian, national channel manager at Acer Computer. Acer's aim is also to take business away from white-box builders and Dell.
Mikaelian said there would be implications for Acer's existing distribution channel as a result of Ingram Micro's appointment. “By the end of the year, we will know--there will be some attrition from the success of the new relationship. “We always look at our partners every year around the October timeframe,” he said.
Acer also has existing distribution agencies with Ingram throughout Europe and the United States.
Existing distribution partners are not so convinced that Ingram's appointment is a positive move for the Acer channel, citing increased price competition and over-distribution of Acer products as their main concerns.
Jennifer Clay, general manager at state-based Acer distributor Compu Wholesale in WA, said she doesn't have a problem with increased competition. “But who are you [Acer] taking off [the distribution list]?,” Clay said. “All the nationals do to us is decrease our margin. Healthy competition I can cope with. It's when they put in a national that cuts the guts out of the price and go for a box drop and that's it.”
Clay is expecting increasing price competition following Ingram Micro's appointment. “There's not a lot else we can do,” she said, adding that the company would rely on quality service, support and local stocking. “I'd rather walk away than go to the levels that another distributor [may] put us down to. With another distributor coming on board, how's it going to go now?,” Clay said.
Daryl Tucker, managing director at IT Wholesale, agreed that existing price competition on Acer products in the channel would increase following Ingram Micro's appointment. “Putting Ingram on as another distributor--I don't see how it's going to work for them [Acer]”.
One distributor, who declined to be named said: “It can be a good thing and a bad thing [the addition of Ingram]. I'm glad that they picked that company rather than the others because they're not as big a discounter in the industry,” he said.
Another, who also did not wish to be named said: “I'd rather be competing against Ingram than Tech Pacific.”
Ian Vagg, director at HiTech--which has operations in South Australia and Victoria--wasn't too concerned, expecting that Acer wouldn't be retaining all eight distributors by the end of the year. “Ingram is strongest in Sydney, an area where we're not operating anyway,” he said.
“Acer has extremely aggressive growth plans. I look at it from a positive point of view because it seems their making a real commitment to distribution,” he said.
He said that Acer wanted to move $70 million worth of its products through distribution over the next calendar year. “They [Acer] want to be a billion dollar company in 2007--they're a $300 million company at the moment,” he said. “It's quite substantial and he [Acer managing director Charles Chung] is not going to do it through his current distributors--he does need distribution to do that [reach the $1 billion mark].”
“In Victoria, where we've been for 12 months, we've done quite a lot of Acer business [and it's] business that they probably lost two years ago when they [cut] their distribution channel. It's fact of life--it doesn't surprise me that much,” he said.
Charles Chung, managing director at Acer Computer Australia, said that Ingram Micro was its first national broad-based distributor here. “It was time for Acer to partner with a national broad-based distributor and Ingram Micro has the right capabilities to...open up Acer's product range to a large reseller base,” Chung said.
Steve Rust, managing director at Ingram Micro, said Acer was a leader in product development, mass product configuration and fast product delivery.
“Our resellers will have a powerful weapon against the channel-unfriendly Dell model. This new partnership with Acer reflects our ongoing commitment to deliver to the vibrant SMB market,” Rust said. Acer customers would be able to access the online configure-your-own PC system via orders with Ingram Micro by next month.
Gartner Dataquest statistics for the March 2003 quarter recorded Acer as the number three PC brand for desktops and notebooks and as having 140 percent year-on-year growth in 2002.