The time is here again when Cisco partners focus on a major sales push before Cisco fiscal year-end. July is typically a month of high intensity for both Cisco resellers and Cisco distribution partners. Yet, in the post-pandemic world, what should Cisco partners consider when working with their distribution partners?
The EDGE360 editorial team recently sat down with Dan Forbes, Senior Director of Field Sales at SYNNEX Comstor, which was named both Global and Americas Cisco Distributor of the Year in 2020. Forbes shared with us that, as always, partners must leverage distributor relationships to ensure that they have the right resources at their fingertips to finish out the year in a strong position. That is even more true today when there have been so many changes in the IT channel and across every industry while the world has dealt with a global pandemic.
“Last year, we talked about communication and making sure that there is a high level of interaction between partners’ teams and distribution so that we all have a high level of visibility into each deal,” Forbes recalled. “That level of visibility and notice benefits all of us so there is time to prepare, and we are not scrambling. This remains true today.”
Forbes highlighted three major changes that he wants partners to understand going into the 2021 Cisco fiscal year-end.
Changing Appetite for Risk
“The elephant in the room is that we are 15 months into a global pandemic,” Forbes said. During this time, there have been smaller partners and businesses across the IT channel that have shuttered their doors. Forbes noted that when a partner goes out of business, which has become an unfortunate reality during the pandemic, someone is always left holding the bag. This has impacted the overall appetite for risk, especially in distribution and financing.
In many cases, distributors like SYNNEX and even manufacturers, have developed their own financing to provide partners with new options. “We are looking for ways to structure business that are good for everyone,” Forbes said. “But it takes more time to identify the right option, do the necessary diligence, and get things moving.” Again, Forbes stressed that engaging the distribution partner early on can help get the process started and get deals through the system on time.
Financing a Subscription Economy
Additionally, many Cisco partners are shifting from pure hardware sales to software subscription models, which creates a new financial model and more complexity.
“The growing complexity that surrounds each of these deals requires both time and communications,” Forbes told us. “It’s no longer about placing an order for a product and getting it out the door. It is now a different conversation with different financing options, layered with an entirely new level of scrutiny that wasn’t there before.”
The mechanics of how a distributor and a partner work together aren’t always easily understood according to Forbes. “I don’t know if it’s appreciated all the levers that need to be pulled (within the distributor) for a deal to get in and out of the business. Especially now, in an Everything-As-A-Service subscription economy where the complexity has increased,” he warned.
As the subscription model continues to evolve, a different process has emerged between the partner and the distributor. Forbes told us that it requires more “active communication to make sure that everyone is comfortable with the process.” He advises partners to start the conversation now with their distribution partners if they haven’t started already. “In some cases, it gives us the time we need to inspect the entire opportunity and determine the best way to support it .” Yet, that conversation, however, can’t take place days before year-end; it requires time and consideration to identify options.
Straining Supply Chain
During these past 15 months, industries have seen a significant strain in the supply chain for goods and services. This has an impact on how a product is shipped and delivered.
“In general, every product that we purchase today is delayed in some fashion due to staff shortages and shipping issues, and the IT industry isn’t any different,” Forbes said. “We’ve seen lead times stretch, and partners need to take that into consideration when talking to their customers and set expectations accordingly.”
While this year may be different than years past, Forbes assured partners that SYNNEX Comstor is ready to work with them. With Cisco NET Pricing in place and the flexibility to provide resources and financing, SYNNEX Comstor is ready to help its partners make a strong finish to Cisco’s fiscal year-end.
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