Dell SA strives to grow local SMB sector

The SMB sector, at least from an IT perspective, is frequently subject to a strong push from larger hardware and software vendors based around what`s known as "the SMB hype cycle".

And while these drives often mean that SMB customers are able to snap up excellent deals on the equipment being purchased, subsequent support is often not adequately geared towards the smaller business with at best a one-man in-house IT department, and the post-purchase costs can spiral out of control leaving the SMB without the advantages they wanted, and a bad taste in their mouths for future IT acquisitions.

Doug Downing, brand manager for enterprise products at Dell SA, says: "I`ve had a lot of experience with the SMB sector, and feel quite sorry for customers who fall into this category. The hype cycle we talk about is all about moving units you see, in that a large vendor will want to boost their perceived market share and sees an opportunity to do this by ramping up unit sales into the SMB space practically overnight through dramatic special offers.

"However, these savings can quickly turn into money traps as the vendor realises the skills and resources in their SMB customers are limited, and their own infrastructure isn`t geared to handle these after-sales requirements cost-effectively, and ends up backing off leaving the customer with a half-functional `solution`, or a massive services bill!"

At Dell SA, the SMB division has been in operation since the company opened its doors to the local market some 10 years ago now, and in that time this dedicated business division has striven to establish relationships with SMB customers to provide a full service solution, similar to that which Dell enterprise customers have come to expect, to the smaller SA business.

In fact, the SMB customer plays an important role in Dell`s worldwide market strategy. The company understands all too well that with IT, there is no one size fits all solution - that a system designed for a large corporate account is not necessarily the ideal technology platform for a 20-man SMB.

Says Ben McDonald, brand manager on client products: "In fact, even within the SMB space we further sub-divide into categories based on employee count, as we understand that each customer has his own unique needs. Since we`re in direct contact with our customers, we have developed a strong understanding of the sector through two-way communications. Dell SA is not in the SMB market for a quick win, we are committed to dedicating a significant amount of resources to everybody in the market regardless of account size."

One of the trends that characterises the local SMB community in particular, is a tendency to purchase IT from the retail channel, and it is here that Dell`s direct model can benefit an SMB. Explains McDonald: "The Dell direct model is without a doubt the most efficient route to our customers, as it allows us to cut out the retailer and pass this cost saving on to our customer base instead of increasing the profit of a middle-man."

There is a second factor that drives vendors into the SMB sector on hype, the need to recoup R&D spend on new products and technologies. At Dell, these R&D investments are minimal as the company leverages the massive investment of all the major players in the industry by basing its offerings on industry standards.

"Which is not to say that Dell doesn`t invest in R&D at all," continues McDonald. "We spend a substantial sum on our testing facility in Austin, Texas, where our researchers plumb their energies into ensuring that our standards-based solutions are the most reliable in the industry. Our engineers at this facility are constantly putting Dell systems through the wringer searching for weaknesses or potential causes of failure, and these findings shape how we build future products to eliminate these potential failures."

It does mean, however, that the company simply doesn`t have the massive research costs of other IT vendors, which are always passed on to the consumer, which contributes to making Dell solutions more cost-effective for its SMB as well as corporate customer bases. Dell systems remain cutting-edge by leveraging the best technology from all the major vendors in the global IT segment.

Concludes Downing: "At Dell we know that the way to approach the SMB market is not to attack it and grab a quick buck. We want to establish relationships and work with our SMB customers as part of a long-term drive, like we do with our large corporate clients. If we can provide sustainable solutions which genuinely help the SMB build its business, we will be growing our own future revenues as well as the economy of the country as a whole."