Dell’s Indirect Sales Channel in China

Posted on April 3, 2008
Filed Under China Business, China Distribution, China SMB |

United States computer maker Dell is accelerating its expansion across the mainland by enlisting new local distributors for its business-orientated products in 1,000 locations.

The world’s second-largest personal computer supplier and the No4 vendor on the mainland, yesterday unveiled its PartnerDirect programme in Beijing, which could intensify rivalry with domestic market leader Lenovo.

But Dell did not give a timeframe for the ambitious expansion of its distribution network. Dell aims to add about 1,000 resellers under the programme focused on the country’s vast number of small and medium-sized businesses.

…Dell expects to shortly add new solutions for specific industries and commercial resellers in assigned territories across the mainland.

With an indirect sales channel put in place, Dell aims to boost domestic demand for its enterprise servers, storage systems, Vostro notebook computers and the low-cost Dell 500 laptop.

According to research firm International Data Corp, Dell’s fourth-quarter personal-computer unit shipments on the mainland grew 41.3 per cent year-on-year and helped it corner a 7.9 per cent market share. Ahead of the Texas-based company were Lenovo (28.8 per cent share), Hewlett-Packard (10.6 per cent) and Founder (9 per cent).

Pacific Epoch has a couple of more tidbits:

Dell China announced on Wednesday that it has appointed Mai Pei as general manager of its newly established business development department in charge of the company’s “Partner Direct” sales plan, reports Sina. Beginning in lower-tier markets, the plan will help Dell organize both authorized distributors and business partners offering sales services, said the report.

Dell plans to expand its commercial product partners from 100 to 1,000 in 2008, reports Sohu. In order to facilitate partner registration and information exchange, the company has opened a new channel on its China site (www.dell.com.cn/channel), according to the report.

The page at Dell’s Chinese web site notes that there are two levels of partnership: registered partners who only need to sign up via an online application form and certified partners who must pass a certification audit. As this partner page at Dell shows, the primary difference between the two kinds of partnership is in sales and marketing support.

What struck me in looking at the list of benefits was what was missing: technical and sales training. Flogging low-cost PCs out of a computer mall doesn’t exactly require a degree in rocket science. However, determining server sizing and configuration, storage architecture, and systems support for SMBs is no trivial task. Channel partners like training because it increases the skills (and organizational value) of their employees; vendors like training because it presumably increases the probability of selling (or upselling) the right equipment to the right customers.

Mai Pei should have an interesting year.