Not Your Father’s Distributors
While IT distribution is still often thought of as the way boxes of IT products get packed for shipment to the channel, in reality that activity plays an ever-decreasing role for the world’s distributors.
Frank Vitagliano, CEO of the Global Technology Distribution Council, or GTDC, an organization that includes 20 of the world’s largest distributors, told solution providers and MSPs at this week’s XChange March 2023 conference in Orlando, Fla., that distribution instead is changing at a rapid pace. XChange is hosted by CRN parent The Channel Company.
Vitagliano said that when he took on the leadership role at GTDC in 2019, there was a lot of discussion going on about the future of distribution.
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“We have marketplaces getting created, and distribution is going to get disintermediated—I’ve been around a long time and been hearing that forever. And I didn’t buy it. … I’ve been in the industry for a long time, as a vendor executive and channel chief for a couple of companies and also as a solution provider executive. And in all those jobs, I worked very closely with distribution and relied on it. So I really didn’t agree with what I was starting to hear.”
Instead, IT distributors are actually becoming what Vitagliano called “ecosystem orchestrators” given the role that they play not in shipping product but in coordinating the activities of and communication between vendors, solution providers and customers.
IT distributors are no longer merely a dot in the line between vendors and solution providers or customers, he said.
“Somebody’s got to be in the middle there to orchestrate all of that,” he said. “Because there’s a ton of work that needs to get done that many of you don’t want to make the investments in your business to do. Having run a solution provider for a couple of years, I know the cost associated with going to market with multiple vendors and making the investments in the new technologies. So you’ve got to find ways to defer some of that.”
Miguel Ribeiro, founder and sales leader of VBS IT Services, a Toronto, Ontario-based MSP, told CRN he has seen challenges related to vendor complexity and integration with the channel.
“From a delivery standpoint, all distributors do a good job,” Ribeiro said. “I think there needs to be more investment in the tools and platforms to give us ease of integration into our systems. I think that will make a big difference in how we adopt some of the new products and services.”
That investment in tools and platforms is ongoing and is increasingly focused on the kinds of platforms needed to orchestrate the more complex business models solution providers need from their distributors, Vitagliano said.
Here is a look at the future of distribution and the concept of ecosystem orchestrator.
LEARN MORE: XChange | Distribution | Professional Services
Joseph F. Kovar is a senior editor and reporter for the storage and the non-tech-focused channel beats for CRN. He keeps readers abreast of the latest issues related to such areas as data life-cycle, business continuity and disaster recovery, and data centers, along with related services and software, while highlighting some of the key trends that impact the IT channel overall. He can be reached at [email protected].
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