There are various advantages for using a reseller when purchasing networking equipment. There are also benefits to buying direct from the Manufacturer. Below we detail those trade-offs with some intelligent introspection.
Reseller: Logistics, the reseller holds local stock, and takes care of taxes, tariffs, currency fluctuation in your region.
Within the US and Canada and other common trading partners, there may be no logistical advantage for ordering from a reseller over a direct purchase; however if you are in a remote country where most products must be imported it is almost a necessity. Some countries have less than above-board customs, and taxation rules, dare I say bribes. In these cases, a local reseller who specializes in local corruption etiquette is a necessity .
Reseller: Local Support, easy to reach technical support in your time zone, training, returns, and trials.
A well-trained reseller who exclusively handles the product you are purchasing is essentially an extension of the Manufacturer. Think of Automobiles. This complex and expensive product to support, could not exist without a large dealer network. In the world of Networking equipment , some things are becoming more of a commodity , routers ,firewalls, and thus, diminishing the need for a reseller. Buying through a channel and the associated mark up may not be worth the added value ,especially if the manufacturer offers good direct support , and an overnight replacement policy.
Reseller: Pre Sale Product Knowledge, a good reseller will educate and explain options for the products they represent.
The potential downside here is that often the Reseller is motivated by the Equipment they give them better OEM incentives to sell, hence if they are selling more than one product line, they may actually downplay one over the other.
Reseller: Representation to the manufacturer , for new features, re-calls
The reseller often times can carry clout to represent you back to the Manufacturer since they represent many sales , they can be very beneficial if you have a problem that needs to be resolved by the manufacturer .
Reseller: Requirements for competitive bid, or government contract dictating approved venders
Companies that provide this type service are generally puppets set up by a government agency , often out of political need to create jobs. If you work for a government agency that forces you to buy through an approved reseller , you are likely well aware of the game.
Reseller and Manufacturer: Personal Relationships
Having a trusting relationship with the person you purchase equipment from is the tried and true way of doing business in many industries, and often these relationships trump all other factors. I personally try not buy based on relationships because I feel it is a disservice to my employer, hence I keep them at arm’s length.
Manufacturer: Price Price Price
Buying direct from the Manufacturer should give a major price break. Any product purchased through a reseller channel is going to add a minimum 35 percent to the direct price and often even double or even triple, depending upon the product and number of hops in the channel. OEMs and channels partners have had a love hate relationship since perhaps biblical times. As mentioned above, personal relationships are the key to most sales in many industries, and for this reason manufacturers must rely on a local sales partner. On top of that, there are also agreements that manufactures sign so as not to undercut the local reseller price, hence the end customer has no choice but to purchase through a reseller. For many traditional products. However new companies coming on the market are often going direct to get a pricing advantage, after you talk to your reseller for a product be sure and do some research on your own and look for similar products sold direct, the price difference could be significant.
Why is it that Cisco’s best customers are provided with direct engineering support? The answer is simple, because it is better. If you can get direct support take it. I’ll leave it at that.
India IT a Limited SupplyJune 30, 2017 — netequalizer
Before founding my current company, I was on the technical staff for a large telecom provider. In the early 1990’s about half of our tech team were hired on the H-1 visa’s from India, all very sharp and good engineers. As the tech economy heated up, the quality of our Engineers from India dropped off significantly, to the point where many were actually let go after trial periods, at a time when we desperately needed technical help.
The unlimited supply of offshore engineering talent evidently had its limits. To illustrate I share the following experience.
Around the year 2000, in the height of the tech boom, my manager, also from India, sent me on a recruiting trip to look for grad students at a US job fair hosted for UCLA students.
In my pre-trip briefing we went over a list of ten technology universities in India, as he handed me the list he said, “Don’t worry about a candidates technical ability, if they come from any one of these ten universities they are already vetted for competency, just make sure they have a good attitude, and can think out-of-the-box.”
He also said if they did not attend one of the 10 schools on the list then don’t even consider them, as there is a big drop off in talent at the second tier schools in India.
Upon some further conversations I learned that India’s top tech schools are on par with the best US undergrad engineering schools. In India there is extreme competition and vetting to get into these schools. The dirty little secret was that there were only a limited number of graduates from these universities. Initially, US companies were only seeing the cream of the Indian Education system. As the tech demand grew, the second tier engineers were well-enough trained to “talk the talk” in an interview, but in the real world they often did not have that extra gear to do demanding engineering work and so projects suffered.
In the following years, many US-based engineers in the trenches saw some of this incompetence and were able to convince their management to put a halt to offshoring R&D projects when the warning signs were evident. These companies seemed to be in the minority. Since many large companies treated their IT staff, and to some extent their R&D staff, like commodities, they continued to offshore based on lower costs and the false stereotype that these Indian companies could perform on par with their in-house R&D teams. The old adage you get what you pay for held true here once again.
This is not to say there were not some very successful cost savings made possible by Inidan engineers, but the companies that benefited were the ones that got in early and had strong local Indian management, like my boss, who knew the limits of Indian engineering resources.