Different Cities, Same Problems

Issues like after-sales and warranty support, decreasing margins, delayed
backend and continuous price drops of products without prior notice were raised
during the IT Panchayat in Bhubaneswar

After a successful chapter of IT Panchayat in Shillong, the next destina­tion
for the mega event in eastern India was Bhubaneswar. The event witnessed the
participation of over 60 partners who made the evening a grand success.

The program started with of brief presentations from the sponsors. While on
behalf of Seagate the presentation was given by Prasanta Roy, Relationship
Manager-East and Northeast, KK Dutta, RSM-East, represented Amconics.

The presentations were followed by the much awaited panel discussion. The
panel comprised Soumitra Mohapatra, Asst Manager-Channel Sales, Neoteric, Ranjan
Samantaroy RM-Channel Sales, Ingram and Sumit Dhanuka, Branch Head-Orissa, Rashi
Peripherals from the distributor's side and Abhishek Poddar of SA Infosys and
Brahma Prakash Mishra of Targous Technology representing the partners.

Issues like after-sales and warranty support, pressure of doing volume
business vis-à-vis decreasing margins, delayed backend incentives and
conti­nuous price drops of products without prior notice were raised and
discussed during the panel meet. Partners agreed that service was an ongoing
trouble which the partners face everyday and was quite difficult to get resolved
unless the principal companies take some steps to streamline their service
procedures.

The panel: (L-R) Sumit Dhanuka, Branch Head-Orissa, Rashi Peripherals, Brahma Prakash Mishra of Targous Technology, Abhishek Poddar of SA Infosys, Ranjan Samantaroy RM-Channel Sales, Ingram and Soumitra Mohapatra, Asst Manager-Channel Sales, Neoteric

The next issue which was raised in the event was that of thinning margins
doubled with pressures from the distis to increase the partners' business
volume, thus making-up for the decreasing margins. “No doubt the profit margins
are declining day-by-day. It is alarming for the entire channel fraternity.
Whatever margins are there the distributors are enjoying that and they will
never share it with the partners,” lamented Basant K Mohanty of Compact Systems.

Reacting to that Samantaroy of Ingram said, “The price calls are taken by the
respective manufacturers and the distributors have a small role to play. There
are various reasons like, schemes, demand and supply, competition, but the key
factor is that the issue depends on the manufacturers' decision to address any
market.” On the other hand Poddar pointed out that though the vendors drives the
market, it is the distributors, who control the main show. “Since they have
their targets to meet, the distributors play the entire game and the channel
gets penalized for it. It is the distis who gives credit to the channel but the
vendors are never involved directly with the partners. Once they start doing
that many of these issues will be addressed.”

Other common issues, were delayed back-end settlements and sudden price
drops. “Stocking is a major threat now since we are afraid of the continued
price drops. The way prices are dropping everyday it is dangerous to raise bulk
stocks or else chances of loss becomes higher. This is a big problem with
products like hard disks,” said Mishra of Targous Technologies

The discussion ended with a vote of thanks by Rajesh Dora, President, ITAO.
“It is very rare that the Bhubaneswar channel community has come out and
discussed these persistent problems in such an open forum. I must thank The DQ
Week for conducting such a show and giving us an opportunity to discuss these
problems openly and trying to resolve them,” said Dora. The evening ended with a
lucky draw conducted by Amconics and was followed by cocktail and dinner.