How can manufacturers help VARs during the recovery?

Mark Beauchamp, European marketing manager for Citizen Systems Europe, considers what manufacturers can do for resellers as the market recovers in 2010.

After what has been a sometimes painful and challenging 12 months, we are now beginning to see signs of recovery from the global economic downturn. Indeed, most of the worlds major economies have now officially emerged from the grips of recession, while China and India are continuing to grow at relatively fast rates.

It is only in the UK where we are lagging behind, with economic indicators showing that despite a range of efforts, not least the Governments bail-out of the banking sector and the policy of quantitative easing championed by the Bank of England, we are still in recession. Having said that, it is beginning to look as if the situation is changing. For example, the recently published survey from the Chartered Institute of Purchasing indicates that the service sector is showing strong signs of growth, while similar surveys show that manufacturing is also picking up, albeit largely due to the weakness of sterling.

Pale shade of pink
The future, and in particular 2010, is starting to look brighter; admittedly not what might be called rosy, but definitely a pale shade of pink. So what can we, as product manufacturers, do to help those in the distribution chain develop new opportunities as the economy returns to normal? In my article in the September issue of IT Reseller, I highlighted the importance of a carefully structured supply chain network; one which ensures healthy competition and therefore competitive deals for consumers, while empowering dealers and value added resellers to maintain strong margins.

Citizens policy, for example, is to manage our channel structure with a small number of key distributors supporting a network of resellers. Each has a dedicated territory or niche market, so that they are encouraged to fight against our competitors, not against other dealers who might otherwise be selling Citizen PoS, label and barcode printers.

Lifetime reliability
Additionally, it is incumbent on manufacturers to provide the products that are either easy for dealers to sell or that provide VARs with the modular building blocks upon which bespoke customer or application systems can be built. Standard products therefore need to be designed for the markets in which they are to be used. In most instances, this means that devices such as printers must be mechanically robust, to ensure lifetime reliability, yet be compact, lightweight and simple to operate, so that machines can be used in the marketplace without the need for additional support from dealers.

You would expect the points above to be espoused by all manufacturers. Unfortunately, this is not always the case, as you often find printers constructed with plastic instead of metal mechanical components, with thin, flimsy housings, or with substandard control switches and displays. This might make a printer cheap, and thus perhaps easier to sell to the uninitiated, but it also results in higher failure rates, dissatisfied customers and wasted time and cost for dealers and manufacturers alike.

Support and added functionality
Just as importantly, in a world where the key to protecting profit margins is frequently the ability to create customised solutions, is the support and added functionality that manufacturers can build into their machines. For example, at Citizen, we now offer as standard basic interpreters (code converters) in all our latest printers. This feature makes it quick and simple for a VAR to customise a machine for use in particular applications, with a dedicated interface to upstream and downstream IT, logistics or production systems.

As we emerge from recession it is almost certain that well find our customers needs and expectations will have changed, and what we as manufacturers and resellers offered in the past may no longer be required in the future. Additionally, markets are likely to fragment still further and applications become even more specialised. As a result, the key to continued success is going to be the ability with which we can adapt to these needs through both continued product evolution and the creation of new and innovative customer solutions. There are, I feel, some fascinating times ahead.