B2B Revenue Acceleration
B2B Revenue Acceleration

Episode · 4 years ago

2: The Differences between the distribution model in North America and Europe w/ Barrie Desmond

ABOUT THIS EPISODE

There has to be a US appetite for change in the distribution model. The cyber security & cloud transformation market is incredibly complicated. Hiring an agency to act as a proxy might be something that a company is far more likely to consider given the volatility of the market.

Maybe we can help the exist in US vendors with some pain points that they have in their go to market strategy by doing some more services aligned to logistics. You're listening to BB revenue acceleration, a podcast dedicated helping software executives stay on the cutting edge of sales and marketing in their industry. Let's get into the show now. You welcome to be to be riven your acceleration. My name is audiamutier and I am here today with buried this month from it's crusive networks. How are you today? Very fantastic. Good so bory. We are here today to talk about the differences between the distribution model enough American in Europe. But before we dive into the details, human just giving us a little bit of background. US to your role. Wisinus creusive networks, as well as it's crusive network as an organization, and what you guess is yeah, so thanks for having me on the podcast. By the way, I'm set at the group level, so I've got global responsibility as the CEO for primarily all the organic growth aspects of the business, which is primarily the P of sales, services and marketing and business development. So that stretches everywhere, from New Zealand all the way over to the US, to San Jose and lots of play. This is in between good so quite the way geography could coverage and in time of his clusive network, could you just give us in a few words, you know, the get the mission of his cusive networks, where your clients have chosen your gates. Mission is to disrupt traditional distribution in the technology sector. We've grown primarily from a European base, in fact, with the only European headquartered global distribution business. And over the years we've decided, because I guess I geographic location from the US, is that we've...

...put together very value base distribution service, if you like, for vendors who are on an expansion strategy. So many vendors seem to establish a footle in their home market. And again, the majority of our vendors are US base, but when they look at the challenges which they face when they're expanding globally, they need a partner which understands the intricacies and the nuances of each smaller region, which you know, primarily the multicultural, multilingual business behavioral differences that exist in Europe. The trade in mentality and passion that exists in the Middle East to obviously the same is true as we go from India are and stretch all the way through, primarily for our southern Asian back to the Antipodeans in Australia and New Zealand. Boosting and expanding a company out of your native domestic market as got a list of challenges which really limits the scope of the business trying to expand unless they have a heart of like us who can act as them that can provide a whole load of value based services like pre sales engineering, availability of Demo Care, go to market plans, launch plans, sales need detection plans and then whole range of professional post sales services like chaining and education, premium services like on site support. For our on site support in Borneo is a lot different to supplying for our on site support in Philadelphia. So that just gives you a flavor how we act as a proxy for vendors as they begin to go on their global adventure. That's very interest. I mean the Shure of expending geographically and going out of shore. I would say...

...domestic market is is something that we we know really well at operatics week we've been able being mini customers and and Europe is a tricky territory were the French like to thin at they are different from the German, the German are different from the English, except t etc. As you are right, the culture of the mentality. And then you open up to a Middle East and up appreciate that having that bunch of services that you can offer being the extension of your clients, cells and marketing team. I guess in some extent induse regions as well as potentially taking all the contract and currency and all the US are bits and pieces I'm sure you get involved in, is definitely taking a bigger take away from from from the table on the side. So I mean that's kind of leading me quite well to the subject of the of the podcast to day. One of my main question to you, which is a big, wide open question, but I think it's considering your global coverage and and your experience of the distribution model across the region and the fire that today we really want to focus between North America and Europe. From your perspective, what would you high light as the main differences between the distribution model in North America and in Europe? Okay, it's a good question and something that we are aiming to change in the common years or the comming months, in that, as as we've expanded ourselves geographically and established a base in North America, the stand as a very different models. In fact, you know, there's a high sort of link between or correlation between the Geo in which you based and the further away that you go, the more value base services that you want to buy off our menu. So as we parachute into the US with an office in San Jose and were in Tampa, in Florida and various sales people based around North America, we're beginning to really understand and digest that. You know, distribution in the US is historically being different to the model in which we've...

...delivered in the geos around the world, and it goes back to the, I guess, the legacy way in which new technology businesses, primarily in Cyber Security and kyle transformation, which is the two markets and which we specialize, have evolved. You know, very often you launch a business and then you establish a national sales force covering all the territories in the US, which is a big area of land covering many rural and many huge metropolises and to maintain, you know, control of your own destiny. You've gone for a very direct at high touch sales models where you employed direct touch sales guys who sell direct to end users and enterprise organizations. Once they get momentum going, they've historically then decided that they've act work with somewhat we called t one partners, which are some integrators, or resellers, or divars as they call them in the state, as a way of fulfilling some of the contracts. Sometimes they go direct and a lot of time the customer will push them towards their it solutions provider, if you like, and then they build up a whole raft of intermediaries known as the resellers, or tier ones as we call them, and they get defocused from their core business, which is, of course, the growth and success of selling their solutions. So they say, well, actually now after retrofit in distribution, to take away some of the basic principles of running a channel to market, which is availability of stock, having the right mix and availability, have the right logistics in place. In the US they have a saying about being distribution should be in a credit shield so they're being able to build, collect and manage the whole credit worthiness of their channel and so to pay the vendor on time, so they don't have to invest in a whole range of resources to do that quote, you know, delivering...

...quotations in a timely manner, you know, within a couple of hours, and being accurate, you know, being over night nine point five percent accurd. This is what they think is the role of distribution in North America and some of the biggest global names that were all familiar with have established their businesses in North America and really and what is a fulfilment transactional distribution model, which for us is just one of our services. They've primarily base their business on that model and that's how it differs from our model, because the value, you know, the availability of resources to do Presales, consulting, professional services, demonstrations, to do the market into do the sales lead totection they've done historically themselves. So those sort of services, the go to market services, the engineering services, the education services, the enablement services, the support services, the premium services, they've really had no need for them in channel from a distribution perspective in the USA and that's something that we hoping to challenge and to disrupt. Okay, so you found US somewhere. What we tooking about? Chase, I guess what I would call value eddy distribution, he said, in services, is being practive, potentially even sometimes helping earlier stage vendors to built the market. Is that correct? Yeah, I think you know, there are two. You know, we've got to find the pain point for the North American venders, if you like, already. So the established ones, we can say to them, well, what is your paying point in managing the channel? You know, where do you think you're missing and where do you think we can help? And my guess already is that they go after the big elephant. The US economy, compared to Europe, in fact, is is huge, and midsize reseller in Europe could be anywhere between...

...fifteen and thirty million euros, or two thousand two forty million dollars, and midsize reseller in the US would be in their hundreds of millions of dollars turnover. So and the companies that normally consume new technology early, the early adopters, if you like, in fact those big enterprises. So my sense is maybe they need some help with the mid market or commercial where we can go and avail all that channel to the services that we've traditionally given in Europe. So that's my sense, is that what can we do for you guys there in the mid market? The perhaps the big distubidest can't do because their cost of sale is so low and their focus is on streamlining and a very thin margin business. So we're sort of same. Well, maybe we can help the exist in US vendors with some pain points that they have in their go to market strategy by doing some more services aligned to logistics. So our global footprint, for instance, and our ability to deliver into a over a hundred and sixty seven countries, we think maybe interest into them so that they can have one contact through a global deal desk capability and deliver into multiple countries and territories in a very light touch way. We could do reverse logistics, we could do disposals, right, so we can begin to add value in terms of those services. But then we can begin to do training, we can begin to do presales, we could do premium based services and hopefully we can help them launch new technologies or new versions or modules of their technologies into this space, so to address a sector of the market which they probably feel that they're under represented. instily, we can say two new start ups from the...

US, why go disrupting the technology market? Why didn't you disrupt the way in which you go to market? So, instead of taking that traditional slow route, why don't we light up the channel first in the US and found find those early adopt the partners like we have in Europe and Asia and Middle Eastern so forth? Why don't we ask them to help you scale and accelerate your go to market? So we're having some very interesting conversations there and of course then we can avail those new start to our full range of services and they can then obviously concentrate and invest in the R and D component of the technology as opposed to the commercial delivery of that. Of course they're going to have to have sales, pre sales engineering services for the US market initially, but maybe instead of adding forty teams of sales and pre sales guys doted all around every state or major metropolis or market in the US, maybe they can cut that by half and then focus only able in the channel so that we can scale and accelerate their go to market. Yeah, I think that that makes perfect sense. Mean from our perspective to gain, we're not as involved as you are in the channel and the distribution model ourselves, but we've gone many time vendors telling us about the cost of ticket. Fine try and working with a big distry. So they need to reach that critical size, which sometimes very difficult to reach a critical size because, as you mentioned, you need to reduce steps of having the team, your own team in region, and that scalability can be can be quite complex, I guess. So the ll make sense to me and I see I see a great opportunity for you guys, defrom, perfectly honest. That's I've got a question for you more on the Reseller, because I would have thought that if the distribution models as evolved in that way, in that I yes, less flixible, less value...

...add more fulfillment type of role, would you need to go through some sort of a transformation also of the sogne layout, which would be the resellers behind that? You see you have you already engage with the Strossilla. Do you see an apetite just rest all the same passion in the Samer Petite as you guys are in Dome of creating the demon from your clients or for your clients. Are Driving almost the flagship of your clients, weening Neu customerls on the help of your clients. Do you see already attraction from from the rest of themselves? I think that's the question really for us is what is the appetite for that the reseller layout in the US to change and to accept this different type of model? I mean, I think this it's a very competitive market. I mean we're in Cyber Security and cloud transformation. I think the market is very complicated. Both markets self from a lack of resource and skill sets. So maybe as acting as a proxy for them is a proposition that they care much more willing to consider these days, because it's historically, I think, they've been there as a fulfillment part as well, certainly either big what I called megavars or divars who have relied on their purchase and supply agreements with the big enterprises just to be a conduit or a channel to market for these vendors. So going in there and trying to provide a value based proposition may not be appropriate or relevant, but certainly in the next lay it down in the regionals and the verticals and the specialists. You know, it's just they cannot, like many end customers, keep up with the speed and change of technology and I think that's a gap in which we can fill and act as a proxy for the Vendor in Scaling, educating, on boarding these resellers as a proxy for them before they decide right, this is the technology I'm going...

...to work you know, so investing, so do the on boarding, but also work with companies like operatics to do the direct touch, to find sales needs and opportunities, to do the convincing. With one of our guys, Lauren, who runs it was the king of Europe or the King of Mediterranean. He always says to sell to convince, we go direct, to sell, to supply, to invoice, we go in direct. So I think we've got a certain amount of evangelizing ourselves. So it's not only evangelizing the technology and the new innovation and the new vendors in that respect, but it's also evangelizing the model and getting acceptance. Solve that and I think we've got a damn good choice chance because there's a perfect storm of complexity coming together and what we're offering is simplexity, simplifying what is a convert complex technology ecosystem at the moment where, from a cybersecurities perspective, the velocity, the variation of attacks and threats and spiraling out of control, there are regulatory and compliance issues which are becoming more critical and more enforceable. Then you have the number, just the fewer number of technologies or security tools people have to put into infrastructure. Ask, you know, make in cteos and SISO's question whether they should go best of breed or the complex, as he is leading them to complacency, where they would, you know, say, well, go to IBM or another generalist, I t supplier deliver what, quite frankly, would be inferious solutions. And the fourth part of the perfect storm, of course, is the skills. Get their over million security side of a security vacacies in...

...the US alone, two million worldwide. So I think the time is right for this provocative model where we can convince the channel in the USA that maybe there's a different way. I've really enjoyed the conversation today, Barry. So we coming to the end, but from a perspective of I did call you early own value, a distributor or someone trying to bring value a distribution to the US market. But it almost sounds like a proactive distribution and I think I like the sun of that because we we live the same story every day. It's about being practive, is about taking control, is about advising and and supporting your clients in striving in the in the market. So look, Verry, thank you very much for your insight today. I'm sure the audience, I do, lots of interesting insight from the experiment that you should you share them and the statements you mane and some of the ads that you are convey as well on on the podcast today. Let's question that I've got for you. I'm expecting people to probably want to get in touch with your father to do the conversation today. What is the best way of getting all of Your Berry? They can send me an email, they can go on the website. My email address is bid desmond, exclusive Networkscom, all the general website exclusive Networkscom or exclusive groupcom. But we run a very flat, real organization here. No matter what anybody's inquiry is, will give it my media at tension mob. That's wonder foot, but I mean it's fantastic and and I know busy you out the moment. We spoke a few weeks ago about about your objectives gazing the US and that you have been very, very involved and back in fall squared a few times. So I really appreciate the fire that you took the time today to get always us and and again, thank you very much for your insight and thank you for your time today. Well, thank you for the tenzero dollars for doing it. Ha Ha, Ha's...

...pleasure. It's in the broad I'm going to see your desk these guys. Thank you. Thank you very much, burried. operatics has redefined the meaning of revenue generation for technology companies worldwide. While the traditional concepts of building and managing inside sales teams inhouse has existed for many years, companies are struggling with a lack of focus, agility and scale required in today's fast and complex world of enterprise technology sales. See How operatics can help your company accelerate pipeline at operatics dotnet. You've been listening to be tob revenue acceleration. To ensure that you never miss an episode, subscribe to the show in your favorite podcast player. Thank you, so much for listening until next time.

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