Direct PC seller Gateway is to give its low profile dealer group new importance, building a division around it dedicated to channel partners.
The unit, to be called Gateway Partners, will combine the reseller channel of ALR, which Gateway acquired last year, with its own small dealer group. The combined entity will be expanded, the company said, in order to gain new footholds in the business market, particularly in servers, where arch rival Dell has been making rapid progress recently.
Gateway Partners will "build more formal ties" with dealers, according to a representative, but he was evasive on exactly what this meant, and denied it represented a U-turn on the company's direct sales-only strategy. Gateway is the world's second largest direct seller after Dell.
"This is no U-turn. We have had a limited channel operation for several years and we aim to be flexible to compete most effectively. But we are no way becoming a channel player," said the representative.
Michael Willcocks, hired from AST to head up Gateway Partners, told journalists that dealer partners would receive a percentage of the revenue from sales they made or leveraged, but would not be allowed to build up inventory of finished PCs and servers.
He wants to recruit dealers who will be 'partners' offering a fairly high degree of added value, particularly in terms of services and specialised business software skills. In some cases Gateway will work jointly with the partner to make a sale.
There will be no box shifting, Gateway executives insist, claiming the key benefit of the direct model is the ability to build to order efficiently and avoid the inventory build-up problems that have afflicted Compaq and other channel sellers in recent months. "This efficiency and flexibility is passed on to the customer in terms of price and personal service," said the representative.
"What we excel at is building specific systems to a customer's requirements in a short space of time," said Willcocks. But he believes dealers' skills and contacts will bring this ability to the attention of the business world.
Gateway said it would not change its policy of building all models to order, either following customer telephone and Web orders, or by shipping unfinished systems to stores and dealers for later customisation.
One-third of the company's revenue comes from corporates and last year it bought ALR and launched new business-specific models to increase its presence. But its profile is small compared to Compaq, IBM and Dell, which gets 75 per cent of its revenues from corporate buyers, processing 15 per cent of this through dealers.
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