D&H’s Technology Conference Mid-West, held last week outside Chicago, had all the hallmarks of the distributor’s other regional partner events.†
An expo hall with dozens of exhibitors? Check. Sessions about the latest solutions from Cisco, Intel, Microsoft, Sophos, and other leading vendors? Check. Presentations from thought leaders like Tiffani Bova, Salesforce’s growth and innovation evangelist and author of the book Growth IQ? Check.
If you were paying close attention, though, you may have detected a little something else not listed in the agenda: Swagger. Over a century after its founding, three months after reporting 17% growth in its prior fiscal year, and weeks before the opening of a big new headquarters facility, D&H is exuding a palpable sense of confidence these days.
“Winning leads to confidence,” observes Peter DiMarco, the company’s vice president of VAR sales.
Key to D&H’s winning formula is what DiMarco calls a “maniacal” focus on resellers too small to get regular attention from larger distributors. “They’re bigger, and so they’ve got bigger customers that they’re serving,” DiMarco says.
Partners notice it too, according to Jason Bystrak, who joined D&H as vice president of cloud early this year following more than two decades at Ingram Micro. “I hear that all the time,” he says. “‘I can’t get a call back from so and so. I see they’re doing stuff, but I don’t know how to get engaged with it.'”
Bystrak is a key player in another element of D&H’s growth strategy—a concentrated focus on cloud computing, pro AV, and other high-potential market opportunities. In the roughly six months since stepping into his current role, Bystrak has expanded the cloud unit he leads from six people to 30 while contributing to D&H’s 107% cloud revenue growth last year.†
“Trajectory-wise for the business, it’s on the hockey stick that we were hoping for,” Bystrak says. “Sequentially now each month, we’re seeing very strong double-digit growth in new bookings and new sales, which is exactly what we were looking for.”
And that was before the unveiling in June of D&H’s all-new cloud marketplace. Designed to be more than just a provisioning portal for online applications, the site includes functionality for building and selling cloud solutions called “clusters” that combine foundation products like Microsoft Office 365 with complementary systems in areas like security and BDR, plus management and help desk services from partners and D&H itself.
Currently in pilot mode and set to enter full-scale production within weeks is additional functionality that will let partners add hardware—along with repairs, asset disposition, and other lifecycles services—to clusters. “The partner can either choose to use services from our portfolio to address the needs they have, or they can use their own services,” Bystrak says.
Though D&H expects laptops and workstations to be the most commonly bundled devices, it’s developing hardware-software-services clusters for a variety of specialized solutions. A new videoconferencing cluster, for example, will combine Microsoft Teams with devices from vendors like Logitech and Poly, plus installation services.
“The goal there is to help partners set up an SMB conference room cost-effectively,” Bystrak notes. Traditional VARs eager to earn recurring revenue will have the option of selling the solution, like all of the other clusters D&H offers, on an as-a-service basis. “You can have the whole thing for a monthly subscription if you want,” Bystrak notes.
Kyle Beckius, purchasing manager at ByteSpeed, a solution provider based in Moorhead, Minn., with customers in all 50 states, is intrigued by the cluster concept.
“If we’re just getting up customers on Office 365 licenses, there’s not a whole lot of financial success we can have with that,” he says. “If we can find new and interesting ways to align that or bundle that type of product with more of the services and products that we traditionally have, that gives us a better vehicle to give them a better overall package.”
Selling clusters will help ByteSpeed embrace the everything-as-a-service business model it’s currently cultivating as well, according to Beckius. “That’s been something that I’d say we’re a little bit late to the game [with], because we’ve just kind of within the past year started more of a formal managed services push,” he says.
ByteSpeed is far from the only VAR looking to become an MSP. To help them make the transition, Bystrak has field business development specialists on his team who, among other things, conduct personalized two- to four-hour consulting sessions with partners. “You can get a lot of work done in helping to get a customer on track and really thinking the right way about their cloud services business,” he says.
Beyond cloud computing, other strategic markets for D&H include pro AV. Within weeks of hiring Bystrak, the distributor hired 28-year industry veteran Peter Hurley as well to serve as director of its pro AV business unit. According to DiMarco, Hurley’s team is having particular success at present in the education vertical.
“We’ve had huge growth with K-12 around interactive displays and as well as things like arenas and assembly halls,” he says. D&H recorded 111% growth in pro AV during its previous fiscal year, and projects another 80% uptick in the current one.†
Ingram Micro and SYNNEX both have the pro AV space squarely in their sights too. Only D&H, however, has made a point of targeting the esports market as well. “18 months ago there was mild interest. Now there’s strong interest from K-12, the VAR marketplace, system builders, and then a lot of the national providers as well,” DiMarco says. “We believe it’s going to be a big opportunity for us.”
D&H will be selective about pursuing additional opportunities, however. “We’re not going to be a partner that goes after every single market in every single solution area that’s out there, because it’s got to be right for SMB,” DiMarco says.
In particular, the company has no immediate plans to form business units like its cloud and pro AV groups around two market segments that Tech Data in particular is focusing on seriously: security and the Internet of Things.†
“We absolutely are investing in security, but we’re doing it through cloud and managed services, and through our networking and infrastructure teams,” DiMarco says.
As for IoT, the 18% growth D&H saw there in its previous fiscal year came largely from smart home products like the Nest thermostat. A broader, business-oriented push is only a possibility at present. “IoT is something that we’re exploring,” DiMarco says. “Again, it’s got to be right for the SMB space.”
A bigger, longer-term challenge for D&H will be continuing to grow the business without diluting the responsive service that has gotten it where it is in the first place. According to DiMarco, the company will keep staffing up as needed to meet goal.
“We continue to add to our sales team. We’ve scaled up in the number of resources that we have in place,” he says. “All of that has an enabled us to keep that customer touch in place.”
The new headquarters, on a 50-acre lot in Lower Paxton Township, Pa., will help D&H accommodate those additional employees. DiMarco is one of many at D&H looking forward to the October ribbon-cutting ceremony for that complex. “We were in a 67-year-old building. You could just visualize what it was like,” he says. “The new facility gives us just a lot more space and room and capabilities that we didn’t have before.”†
It’s also one more manifestation of the company’s confidence in its future. “We’ve invested,” DiMarco says, and will continue doing so.
