Monday, August 15, 2016

5 Misconceptions About Telecom Distributors



1. Distributors are basically warehouses and offer no true differentiators

While some distributors simply offer customers the ability to buy or store products, true distribution partners like Comstar Supply offer something more. Strategic communication between a distributor and customer allows for continuous value exchange. Compelling business factors from both the distributor and customer should be communicated appropriately for crucial support of each other’s respective business goals.

2. Customers lose margin to the distributor


According to a study conducted among vendors by the Global Technology Distribution Center (GTDC), economies of scale from distributors result in vendor cost savings considerably higher than 3-5%. From logistics to credit infrastructure, distribution vendors are in fact much more valuable to buy from than a direct model.

3. Advent of the cloud and other Internet-related tools de-value distributor model


According to the GTDC, as more and more transactions occur on the Internet or through the cloud, there is no substitute for the specialized skills and capabilities of distributors to drive the sales and fulfillment processes. While an e-commerce model makes sense in industries such as software, outside plant and telecommunications products require physical logistical infrastructure, storage, and inventory to support demand for one-stop shopping.

4. Distributors just take orders


Within the OSP and Communications marketplace, distributors not only offer products, but also machine tools and technical support. Distribution plays a vital role in ensuring customers are fully informed on technical specifications of products, as well as advising on configuration issues and compatibilities. Without this role, many new technologies would move far more slowly through the adoption cycle and resellers would struggle to realize their business potential.

5. Carriers and Subcontractors Would Prefer to Deal Directly with Manufacturers


While some want a direct relationship, most carriers and subcontractors have such demanding logistical requirements they insist on distributors handling the supply chain and providing the related transaction processing infrastructure, including credit provision. Large accounts want the ability to connect with vendors at a strategic level backed up with day-to-day account management to be able to resolve issues with the right level of priority. In some instances, the customer will deploy sales support that works directly alongside distributors to develop end-customer relationships.

Monday, August 8, 2016

How to Leverage Strategic Partnerships with Telecom OSP Distributors

Traditionally, distribution partners are thought of as Costco-like wholesalers, with a large inventory and little to no differentiation from competitors. Customers simply buy from a company that would break down bulk product and handle freight. But a few telecom distributors are creating a paradigm shift in the industry by playing a more critical role in the planning and delivery of outside plant materials.

Specifically, Comstar Supply differentiates ourselves by building partnerships with our customers vs. just being a logistics mechanism for their business. Our customers desire tailored inventory, control over inventory position, storage, logistics, and access to our employees - who know their business. And most importantly, they want communication. Our goal is to be build a consultative relationship with customers by focusing on capabilities and outcomes. This emphasis allows us to orchestrate multiple relationships with suppliers, while distilling customer business needs and prioritizing them for our customers.

"Our biggest challenge and opportunity is to educate our partners and potential customers on current market conditions and work with them to provide solutions tailored to their specific needs," said Todd Rhen, SVP Sales for Comstar Supply. "We’ve done a great job securing allocation and capacity with our supplier partners and allowing our customers to prioritize their needs for maximum results."

It’s that constant stream of communication, sharing of ideas, and building customized programs which gives our customers a competitive edge over their competition by providing speed to market for their services.