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Resellers under threat from customers

Staff Writer
By Staff Writer, ITWeb
Johannesburg, 27 Mar 2002

Imaging distributor ImageTEK has issued a strong message to its resellers, warning them to beware of corporates that engage in unnecessarily long and complex pilot projects.

Eldaline Botha, business manager at ImageTEK, says it is no longer necessary to pilot established imaging technology.

"Imaging-enabled systems are proven and pay for themselves within as little as three years," she says, "but the corporate market is causing resellers major financial losses because they are being manipulated by larger corporates. In some cases, the corporate has no intention of purchasing a solution, and is only interested in testing new systems."

Botha claims that these pilot projects are costing the reseller base millions every year.

Tony Galvao, Gauteng solutions sales manager at First Technology, an independent IT solutions provider, also warns the market that resellers are in dire straits.

"Because many resellers are in desperate straits, they`re willing to promise potential customers virtually anything in order to conclude a sale," says Galvao. "They know that by throwing in value-added services such as consulting or auditing for free, they`ll make no money on the deal, but they see this as a short-term sacrifice in order to 'get a foot in the door`. They`re wrong.

"There`s no guarantee that their customers will remain loyal when they suddenly have to start paying for services previously provided free of charge," explains Galvao.

He also warns end-users who expect resellers to give away these services that they too are being short-sighted.

"The reseller stone was bled dry a long time ago. There is simply nothing more that can be squeezed out. A decade ago, the industry went through the same pain. We should avoid repeating the same mistakes. Resellers and their customers have to look beyond price to the value of building a relationship built on trust and mutual respect," concludes Galvao.

Related story:
Tony Galvao: IT reseller market in for a tough time

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