Just a few weeks after signing up SMB networker Linksys, big distributor Tech Pacific has struck a fresh retail-focused distribution agreement with BenQ.
The broad-based distributor's market reach and new focus on striking relationships with mass market retailers were the major catalysts behind its appointment, which had been in the works for the past six months, said Philip Newton, MD at BenQ Australia.
Tech Pacific joins Synnex, Westan, and Bluechip IT as the vendor's national distributors. BenQ also has a list of regional distribution partners which include Compuworld in Queensland, Alepine Peripherals in NSW, Leader Computers in South Australia and DMA in Western Australia.
Newton confirmed that within the next six to 12 months, it was likely that a national distributor would drop off the list. 'There are a couple of distributors at this stage who I feel don't understand who we are as a company. Tech Pacific has a logistical capability which gives us instant access to a broad range of mass merchants that our other distributors aren't contemplating touching. If Tech Pac did nothing else but grow our retail business, we'd be doing well.
'It could be argued that we have too [many distributors] in that national space. How that pans out depends on how Tech Pacific runs with the ball,' he said. Newton added that Tech Pac's appointment wouldn't do damage to other distribution partners. However, he did say that one national distributor would go and 'it may well be themselves taking that action,' admitting that there was already some 'conflict' between BenQ's existing three distributors.
Newton said one of the most exciting aspects of the process was that Tech Pacific was forming a 'convergence products group' -- a space which BenQ 'is working hard to address,' he said.
Newton said that Tech Pacific was the only vendor, excluding Ingram that addressed the top 100 commercial reseller market.
The 'digital home' space, however, was an important market for BenQ and every month between now and Christmas, the company would be releasing products that fell into the hands of consumers.
Tech Pacific was moving BenQ's entire product range which included laptop computers, LCD screens, digital cameras, projectors, scanners, keyboards, mice and MP3 players. Today, BenQ's share of the retail -- particularly mass merchant retail market – is next to nothing. Around 80 percent of its sales revenue is derived from the commercial market.
By the end of 2004, 50 percent of its sales revenue would be derived from the retail space, Newton said.
Tech Pacific MD Kerry Baillie told CRN, that the 'digital home' market was a strategic market for the company this year. He said that last year, Tech Pacific's retail business grew by around 45 percent.
Commenting on Tech Pacific's appointment, Victor Aghtan, MD at BenQ national distributor Westan said the decision would affect his business and confirmed that the vendor was aiming to work with only three national distribution partners. 'When a vendor starts to expand their distribution channel it is inevitable that it would affect the existing distribution channel,' he said.
He claimed that the BenQ business, for the past nine months, had been growing rapidly for the distributor and the vendor would more clearly define its channel model soon.