Use Your Relationships With Distributors to Boost Profits
Expanding the relationship with your distributor can simultaneously boost your bottom line.
Batman and Robin. The Lone Ranger and Tonto. Sherlock Holmes and Watson. These iconic duos include sidekicks who help the superhero by providing a variety of services — brains, muscle, comic relief — that change with every situation. A sidekick, in the end, helps achieve success. The bad guy is behind bars. The mystery is solved. The mission is complete.
Distributors do the same thing, offering multiple services that provide maximum assistance. When capitalizing on all of the available benefits and support available from distributors, the job gets done, the end user is happy, lives and property are protected and, perhaps more importantly in today’s economy, money is saved. That boost to the bottom line comes in many different ways, including managing inventory, training, time and money-saving services such as pre-programming and product packaging, and more.
Every distributor has a slightly different focus and value proposition to consider. Just like every superhero has a tailor-made sidekick, dealers who thoughtfully choose their distributor(s) gain services and benefits that work best for them — creating a powerful relationship. That relationship becomes a “workforce multiplier,” according to Jim Fairbanks, president, SiteSecure, Sanford, Fla., the integrator featured on this month’s cover.
SiteSecure capitalizes on a comprehensive service offering from its distributor, Anixter International Inc., Glenview, Ill., a global supplier of communications and security products and more.
“By working together on business development, account management, technical expertise, logistics support and contracting expertise, SiteSecure and Anixter have in effect increased their combined capabilities and resources by working together,” Fairbanks observes. “Over the years, that teamwork has been leveraged by both parties to increase mutual business.”
SiteSecure was awarded the Anixter North American Edge Partner of the year in 2009 and again in 2012. “This is in recognition of our continued partnership in working together and growing both businesses during some tough economic times,” Fairbanks shares.
SiteSecure capitalizes on many of Anixter’s value-added services that lower its overall deployment costs — services such as job accounts, staging of inventory, will-call pick-up, and Ready! Services, which include pre-configuration of IP cameras, software pre-load on server hardware, and bundling of accessories in a single kit configuration.
“These services ensure consistent equipment delivery by reducing packaging material, eliminating ‘out-of-box’ equipment failures and project staging of deliveries. These services also virtually eliminate the hassles of return material authorization (RMA) issues with manufacturers, increase the ease of installation and reduce material handling at the job site,” Fairbanks says.
SiteSecure utilizes Anixter for all its equipment procurement, inventory staging and logistics support.
“Shifting this liability to Anixter has significantly increased our profitability. Anixter communicates with our staff to ensure that our most commonly used materials are stocked in local distribution. So, our working capital is not tied up by parts inventory; we leave that specialty to the technology distributor,” Fairbanks explains.
The ability to manage inventory via distribution has an immediate impact on a company’s bottom line, agrees John Krumme, president of Cam-Dex Security Corporation, Kansas City, Kan., a Security-Net member.
“By using the same distribution company, in close proximity to our multiple offices, all of our employees are working from the same pricing structure and specifications. It helps throughout our business to buy from one entity, and impacts our accounting, inventory management and purchasing department. Using only a few distributors enables us to become more familiar with their pricing and financial terms. That adds to our profit and bottom line when those are all aligned,” Krumme explains.
The best benefit of the distribution model is that distributors have the ability to quickly respond to the product needs of systems integrators, Krumme believes.
“Distribution inventories the products needed, and in most cases it’s readily available to pick up and mobilize to a job site. This drives additional profit to the bottom line for systems integrators because distribution is absorbing the cost of stocking inventory. Companies are always looking to reduce inventory, and with a business of our size, we can see a $10,000 reduction if inventory is managed off-site or through distribution,” Krumme estimates.
Chris Burnes, Burnes Citadel Security, St. Louis, a long-time customer of SES, Earth City, Mo., uses the same approach.
“SES has a constant supply of product. We do not keep a large stock, so we are in the branch every other day shopping. If we need it, SES has it in stock or can get it quickly.”
Burnes also values SES’ “good pricing, easy over-the-counter exchanges, and no lengthy paperwork.”
Distributors help pick up the slack, serving in many roles. This can include leads, sales support, technical assistance, and more.
“The term ‘distributor’ is limiting,” says Nigel Waterton, vice president of corporate strategy and development, Aronson Security Group (ASG), Renton, Wash. “It infers that it simply brokers an exchange of product from one source to another. This is a central part of most technology vendor’s market strategy. However, next generation distributors do more. We have seen a demonstrable value impact by using the packaging (kitting), logistics, and support of distributors.”
WESCO CSC provides a unique service for uncovering business opportunities. Through its WESCO CSC account manager, the company’s integrator customers have access to the WESCO Business Development Team.
“This 40-plus-person team, located in Chicago, is trained at uncovering projects and will investigate opportunities on the customers’ behalf. The team writes detailed reports on the qualified projects they find, so they can be jointly pursued with the integrator who provided the tip. We serve as an extension of the integrator’s sales team,” shares Mike Duncan, vice president of security solutions, WESCO CSC, Carol Stream, Ill.
ScanSource assigns a rep to every account as an advocate for the customer’s business and to offer in-depth insight into products from a technical standpoint and beyond.
“The relationship with the representative, makes sure nothing falls through the cracks,” shares Tony Sorrentino, president, ScanSource Security, a business unit of ScanSource Inc., Greenville, S.C. “A lot of people think of knowing the products from a technical standpoint, but there is just as much or more information in knowing the nuances of the different vendor programs out there. Each program has guidelines and ways to take advantage of those programs. Knowing what is available and how the dealer can plug in and maximize those partner programs helps our dealers be more profitable.”
Product knowledge is just one factor Daniel Budinoff, Security Specialists, Stamford, Conn., a PSA Security member, looks for in his distributor.
“The most important item we look for is great customer service. After customer service we look at their collective product knowledge, competitive pricing, available inventory, credit terms and prompt delivery.”
Budinoff also uses PSA Security’s competitive bid program where PSA goes to its vendor partners to obtain better than the usual ‘best’ price.
“By building a mutually loyal relationship, my distribution partners go out of their way to provide Security Specialists great customer service and product at the best possible price. That helps us land more projects and make a profit,” Budinoff shares.
The relationship is everything, echoes Darren Wieder, business development manager, Convergint Technologies, Schaumburg, Ill.
“The best value we receive from ADI as a distributor is the local relationships we have with the branch staff. As a partner they help us get things done quickly and professionally.” This included programming 270-plus cameras for a large and critical data center video surveillance project. (Read about it on page 56.)
Even the smallest of benefits adds to the superhero-sidekick relationship.
“SES is right down the street from our office. The local branch workers are awesome! My guys love to go there for free soda,” shares Jennifer Porter, Advanced Alarm, Colorado Springs, Colo.
Whether programming hundreds of cameras, packing product into time-saving kits, offering training sessions or just a simple cold soda, distributors have a lot of time-saving, profit-boosting offerings to seize.
“Our relationship with Anixter is based on mutually beneficial trust and appreciation for what each company provides the other. It is a true partnership in which both companies win. The services from Anixter that are incorporated into our entire business model have allowed us to grow not only top-line revenue but our bottom-line profitability,” Fairbanks says.
It’s a simple, but powerful approach, or perhaps more appropriately put, “Elementary, my dear Watson!”
Powering Sales With Training
SDM asked distributors, “Is there anything unique or changing regarding your company’s approach to training in 2013?”
Our goal this year has really been to educate our dealers about RMR, upselling and offering the lifestyle security products that end users are seeking. This year we have offered more lifestyle security product trainings to educate our customers on the advantages of interactive services. The interactive services idea is catching on quickly and advertised widely to end users. So now our in-branch trainings have turned from a filled room to standing-room only.” — Crystal Koelsch Ingram, marketing manager, SES
At some point dealers need training. From sales techniques for sales staff to tech training for installers, we work with all of our manufacturers to provide free training opportunities for dealers and their staff. When it comes to sales training, we encourage dealers to just give us a call. We’ll figure out what is needed, and develop a plan especially for them.” — Tom Piston, vice president, Sales and Marketing, Dynamark Security Centers, Hagerstown, Md.
We believe it is our responsibility to provide our dealers with the training they need to win new business ... For example:
• One of our dealers, Pacific Technology in California, wanted to learn more about Arecont cameras, so we set up training for them. In turn, they won a couple of jobs based on the training we arranged for them.
• We introduced our dealer Tal-co to a multiple-location, restaurant-establishment end user in Texas that was looking for a new CCTV system. We trained the dealer on the products, and helped them provide a demo to the end user to close the deal.
• In Puerto Rico, we have provided several trainings for dealer Alpha One and have even participated in sales calls with them to help them win numerous video surveillance projects.”
— Michael Flink, ADI Americas, Melville, N.Y
Distributors ‘In Action’
WESCO CSC’s Detroit branch worked closely with one of its integrator partners, who had just secured a multi-site rollout for a major international retailer. Initially, the retailer was only looking for IP-optimized servers. WESCO CSC determined that it could provide additional value by rack and stacking all of the datacom and security products, as well as kitting and labeling ancillary products needed for the installation. This saved labor costs and downtime on the job, and prevented out-of-box failures. All sites included in the rollout now look identical, making future troubleshooting and maintenance much easier.
Distributors ‘In Action’
Graybar distributes electrical and communications products that help cover security needs throughout its distribution network of more than 240 North American locations. When Motiva Enterprises LLC, which operates three oil refineries that convert approximately 740,000 barrels of crude oil into usable gasoline daily for Shell-branded gasoline stations, began a five-year expansion project, read how Graybar leveraged its network of relationships with installers from Louisiana and Texas to arrange the installation of Motiva’s expansive surveillance and security system. Turn to page 96.
Rainvision, a brand of DWG Distribution, Hicksville, N.Y., is a full offering of cloud-based video surveillance camera and access control hosting and backup services. This is a rapidly growing market and offers many benefits including lower up-front cost and lower support and maintenance, according to DWG. DWG also offers a New for 90 Program in which participating manufacturers allow for 90-day DOA on all products, which the company says allows the dealer time to get the system up and running and provides peace of mind in that he is covered in case of product failure before or near after his project is completed.
PSA Security Network launched a Preferred Owner Program (POP) that is tied in to its Premier Vendor Program (PVP). With this program, owners receive free freight, extended terms and extra training dollars on purchases with the PVPs. In return, they’ve committed to growing their business with the PVPs and PSA overall. This brings additional value to all parties involved. — Ric McCullough, vice president, Sales and Customer Service, PSA Security Network
A WESCO CSC branch in Texas partnered with a customer who was offering customized surveillance on school buses. Required services included IP addressing, firmware and software updates, and powder-coating the camera housing “school bus yellow.” By using WESCO CSC as a one-stop-shop for all of its service needs, the integrator was able to save more than $100 per camera.
ScanSource Security now offers a Web-based product selection tool, dubbed SNAP, for its resellers and dealers. The system lets dealers search by parameters such as manufacturer and part number; it then provides a data sheet with suggested pricing and helps narrow down the product dealers need for what they are looking to do. “For our dealers to be competitive they have to outpace everyone else and be faster. A fast catalog and order entry where they can check pricing and real-time inventory of product is just one way we are helping our customers operate faster.” — Tony Sorrentino, ScanSource Security
Spec-SES is designed to streamline ordering and bidding, help dealers become more profitable on every job, and save valuable time. According to SES, Spec-SES is a fast, reliable way to bid jobs and train new hires, placing all the relevant components to a job on one sheet. Spec-SES worksheets are available for burglary, access control, home theater or video.
A WESCO CSC Denver branch had a customer with an immediate need for IP camera addressing for a multi-site rollout. The need was uncovered on a Thursday and installation began the next Monday. All cameras were IP addressed, shipped, and at the customer’s door in less than one week, helping the customer close the deal and move quickly to future projects.
IP Drives New Services for Dealers
Growth in the IP video market has the attention of distributors, many of which are launching key services offering IP support. If you think you can’t afford the personnel or training needed to capitalize on IP’s growing opportunity, think again. From ongoing and in-depth IP technical trainings, to an extensive line card of IP products, to pre-programming and configuration services, there are new services to utilize. Here are a few.
TRI-ED Distribution describes its IP-EZ Programming Service as a “true plug-n-play solution that simplifies the installation process.” IP cameras purchased at TRI-ED can be pre-programmed to the customer’s specifications and shipped to them directly, ready-to-go and equipped with the latest firmware revisions.
“It’s a labor-saving and cost-effective service for our customers, and helps them stay competitive in the rapidly growing IP space,” says Pat Comunale, president and chief executive officer, TRI-ED.
ScanSource’s Custom Configuration Center helps build total solutions easily — but the most important benefit of partnering with the custom configuration team is it will save time and money, according to ScanSource. The company reports its research shows its economies of scale allow for substantially lower cost than performing the same functions in-house (30 percent less) or using an outside source (35 percent less). Custom configuration is strategically located in the ScanSource warehouse, providing direct access to all product lines. DOAs are eliminated because all units are fully tested when they are integrated, and ScanSource’s freight policy eliminates the expense and hassle of shipping product from the integrator’s location to the end user after integration, ScanSource says.
WESCO CSC’s services include supply chain solutions such as kitting, labeling, project staging, and more, but its Value Creation Program also includes services specifically aimed at enhancing the productivity of IP surveillance integrators. These solutions include “rack-and-stack” builds, IP addressing and advanced configuration of cameras. They reduce installation time, eliminate out-of-box failures, provide easy identification on the jobsite, and ensure consistent assembly and configuration of cameras, racks and servers optimized for surveillance applications, describes Mike Duncan, WESCO CSC. (See “Services to Save” on page 100 for examples of the services in action.)
ADI also recently launched its Programming Plus Program, which helps dealers save time and money on their IP installations. This program prepares all cameras for large IP installations so dealers can simply install the cameras and alleviate labor hours. The services include programming IP addresses, confirming and updating firmware, labeling the camera and box, camera burn-in, quality inspection, verification of address, and then shipment to the job location. (See “Distributors ‘In Action’” on page 56 for an example.)
“The explosive growth in the IP market, particularly in IP cameras installed in residential and commercial locations, has lead ADI to tailor its training offerings to include more IP-based learning, shares Michael Flink, ADI Americas.
“We have utilized Dave Engebretson of Slayton Solutions Ltd. [SDM’s Contributing Technology Writer] to provide comprehensive IP networking and fiber optic training to our dealers. The goals of these training programs is to equip our dealer base with knowledge they need to immediately start offering, winning and installing IP surveillance systems,” Flink says.
Anixter’s new ipAssured: Defining Network Video Migration program is designed to provide a roadmap for security end users and integrators looking to migrate their video surveillance networks to a real-time, scalable IP-based solution. The new program establishes an open system, standards-based network video architecture to address current and future video surveillance applications.
Anixter also offers READY! Deployment Services, which combine sourcing, inventory management, kitting, labeling, packaging, and deployment services to simplify and address the material management challenges at job sites. “In a nutshell, our READY! To Go solutions are a prepackaged IP security system that includes everything our integrators would need to implement an IP security system for their customers whether they are a small retailer, corporate campus or a bank. READY! to Go services come in 8-, 16- or 24-camera systems and include all the necessary products required to install the IP security system from camera to UPS and even down to the tools to complete the installation. We assemble the cabinet, test the cameras for DOA , and load the video management software for the integrator. All of the products are packaged under one part number, arrive in one shipment and the integrator receives one invoice,” describes Amy Huizenga, director of marketing security solutions, Solutions Marketing, Anixter Inc.
For an up-close-and-personal IP experience, Anixter’s new 4,000-square-foot Infrastructure Solutions Lab at its world headquarters in Glenview, Ill., provides a venue for Anixter to educate, demonstrate and evaluate technologies, including IP (plus fiber and copper network cabling, video surveillance, access control, PoE and more). For more on the lab, read “Demonstrate, Evaluate, Educate: The Anixter Infrastructure Solutions Lab” at www.sdmmag.com.
Editor’s Note: Many distributors, including the distributors above, have multiple services, product lines, and trainings related to IP — many more than the few listed above. Check into the full breadth of the services your distributor provides.
Distributors ‘In Action’
A Kansas customer called Crystal Koelsch-Ingram, SES, and asked how she instituted advertising screens in the branches. “I walked him through the process and told him about the hurdles I had to overcome,” Koelsch-Ingram describes. “I was on the phone with him for more than 20 minutes. Once we were finished he thanked me and said ‘SES is valuable in more ways than just sales; none of my other suppliers would have walked me through this process.’ Our goal is always to provide true customer service. I wasn’t trying to get him to purchase more product; I was helping him with a way to advertise his business.”
Distributors ‘In Action’
“Convergint partnered with ADI for a large and critical data center video surveillance project of 270-plus cameras. As part of its value-added services, ADI is preparing all the cameras for installation so Convergint is able to easily install and commission the cameras, minimize workload hours and complete a more efficient and on-time system installation. ADI is completing all the pre-programming tasks including bench-testing all cameras, setting usernames and passwords, preparing camera naming conventions, programming IP addresses, confirming firmware and labeling each camera with the correct location for installation. Having the cameras prepared before installation provides consistency in the camera programming, and helps our installation run more efficiently by eliminating any possible issues with camera functionality.” — Darren Wieder, business development manager, Convergint Technologies
Capitalize on Credit
The DWG Dealer Rewards Card is a reloadable credit card that can be used anywhere Visa is accepted. The program is available to verified DWG dealers that have had a verified dealer account with activity of $1,000 or more for a minimum of six consecutive months. The card is not available to online stores or distributors.
The ADI Credit Card was introduced to give dealers more buying power and more credit options. With the ADI Credit Card, dealers can get 180 days interest free when their purchase is made on the card and their balance is paid in full within six months. Ultimately, this increases cash flow for dealers, and in many cases they are able to get paid on a job before they have to actually pay for the products they installed. With the ADI Card, dealers now have the potential to go after larger installations they may not have been able to before.
ScanSource provided $60.7 million in financing help for partners between January and August of 2012 alone. Financing options include credit, leasing, working capital and more.
“We work hard to help our customer maximize our customers’ buying power through us,” says Tony Sorrentino, ScanSource. “We make sure they are aware of all their options. A common theme is that dealers’ end users are taking longer to pay them, so providing options and flexibility to offset that is key. If a dealer is willing to communicate with us and share, we’ll work with them.”
Distributors ‘In Action’
“We were working with ADI on a large quote for a complete security, access control and video surveillance system for a distributor of automotive and industrial products ... Our ADI team introduced us to the ADI Credit Card, and explained to us all the benefits. The credit card offered a great value to our business as we were able to get all the products and accessories we needed for the installation without tying up any of our own credit line. Also, with the interest-free promotion it helped increase our cash flow by allowing us to receive payment for the job before we had to actually pay for the products we installed.” — Chris Minnick, vice president, Fastech Alarms
For more coverage of distributors, see these recent articles and guides published by SDM:
“SDM’s Distributor Guide” Use this guide to locate distributors of security and related products.