Avnet: Distribution's "poster child" for innovation
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Jeff Bawol | As seen in eChannelLine -- DENVER: Avnet Technology Solutions continues to stand out from its distributor peers and is still the "poster child" for innovation, said IDC analyst Christina Richmond. She was commenting on the company's introduction -- and a demonstration -- of its SolutionsPath Playbooks at the Sun Microsystems partner conference, Compass '09 (see Monday's 'Avnet: Focus on customers and solutions' for more details).
"I'm not aware of any other distributor doing this at this depth," she said. "With 8 people involved in keeping this content current and complete, there's real money being spent here by Avnet."
Richmond, who along with Janet Waxman, produced a report earlier this year examining how Avnet was differentiating itself in the market by evolving from a value-add to a solutions focus, was impressed by the efforts the company is making to stay ahead of the pack. And while the distributor also carries HP and IBM products, it's a real plus for the Sun ecosystem as the change in ownership approaches.
With almost 30 years under his belt at Avnet, including the last 18 months as president of Avnet Technology Solutions, Americas, Jeff Bawol is very familiar with the distributor, Oracle and Sun, and he gave eChannelLine a high-level SWOT analysis of what the pending acquisition of Sun by Oracle could mean. While nobody knows what will happen until it happens, he offered the following perspective of their relative strengths, weaknesses, opportunities and threats.
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Avnet keeps on innovating
As seen in Computer Dealer News -- Back in January, IDC came out with a report stating how, in a market that's rapidly consolidating and commoditizing, IT distribution is often challenged by investors, suppliers and partners about their ability to add value to the supply chain. “With margins eroding and the complexity of many of the product lines diminishing, distributors are constantly challenged to find compelling business differentiation that sets them apart,” stated analysts Janet Waxman and Christina Richmond. “Some but not all have.”
The report goes on to describe Avnet as a “poster child” for innovation in IT distribution with Avnet SolutionsPath, a methodology designed to help partners specialize in high-growth vertical and technology markets, including healthcare, government, education and virtualization. “Through these practices,” said the report, “Avnet has shown that distribution can in fact add value and is beginning to change the rules for IT distribution.”
Avnet recently announced that its U.S. government market practice – which includes vertical-specific tools, consulting and university-style training – has helped its VARs achieve an average revenue growth rate of 32 per cent year over year (in some cases higher).
And now Avnet has launched a series of online sales toolkits, called SolutionsPath Playbooks, to help VARs develop solutions in specific technology segments and vertical markets. We're not talking a dozen or so – we're talking 75, to start. This is all part of an initiative Avnet execs undertook earlier this year to reevaluate how the distie packages its solutions and training.
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Avnet's Harley Feldberg: Encouraging design despite the discouraging economy
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Harley Feldberg |
As seen in Electronic Business -- Electronic Business spoke with Harley Feldberg, president of Avnet EM (Electronics Marketing), about distributor Avnet Inc's recently closed fiscal Q4, staying open to growth outside Asia/Pacific, inventory reduction and end demand, and why it's important to continue with design work, even if the recession is holding back immediate revenues. What follows are excerpts of that conversation.
Electronic Business: It seems like Asia/Pac is still a major driver of growth. EM's 20% sequential growth in Avnet's recently closed fiscal Q4 came from Asia. Is that still where you will focus when it comes to growth and merger and acquisition activity?
Feldberg: When you say focus on growth, we are not biased to turn down growth anywhere. But clearly the growth in our industry is occurring primarily in Asia today. We are looking for indicators of either stability or some minor growth in the Western regions. So far, I think it would be fair to say that we have an improving level of predictability and consistency in the West but clearly the growth is occurring in Asia. We're looking for growth anywhere, not just Asia. We continue to invest where necessary in the Western regions. We have no intention, nor do we want to give the impression, that we are diminishing our commitments to those markets. But clearly the growth over the last four or five months has been Asia.
Electronic Business: Are there any specific segments in the West that you are looking at?
Feldberg: There are some areas that are less prone to moving offshore, things like defense and medical. But specifically what we are really watching is the broad industrial marketplace. That's really the core of Avnet's distribution business in both America and Europe. We are looking for any indications -- which we have not seen yet, by the way -- that that broad industrial accounts base is going to start to accelerate. We haven't seen that yet, but that's critical to our profitability.
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