Is Consolidation (Always) Bad for Your Business?
Like many yes/no questions, the answer isn’t so simple.
First, consolidation is a fact of our industry – whether we like it or not. The bigger national companies grow bigger – and gain more leverage. Meanwhile, specialized IT providers lose leverage.
In the IT market, we have a tiny number of large, national VARs. The more they acquire their competitors, the more they gain a huge advantage over the rest of the market.
Often, for local and regional VARs, this means:
- Deal registrations become more cumbersome and political.
- Manufacturers cutting channel-support resources.
- More bureaucracy & politics working against you.
- Locked up inventory for bigger firms’ large deals.
However, with B2X, you can get white-glove service on the same products you previously ordered through the biggest distributors. Our pricing, terms, speed, ease, and quality of the entire experience sets us apart.
We champion the cause of under-served IT solutions providers, so we’re tired of seeing this vicious circle – though it’s “how the cookie crumbles” these days:
- Because consolidation also happens at the lower levels of the supply chain, there are fewer companies involved, and a reduced number of options for resellers.
- Frequently, we see an emerging storage solution come to market . . . and forward-looking VARs do well selling it.
- Then, a large storage company comes in, buys the solution, and immediately folds it into its traditional channel system.
- So, these adaptable resellers end up at the back of the line when working with the acquiring manufacturer . . . and the big guys get all the benefit again.
Ever seen CDW, SHI, or Insight get introduced to one of your clients by common channel resources? Happens every day . . .
With B2X, it’s different. It’s an opportunity.
That said, you can capitalize on this consolidation trend.
You can use these market shifts + channel disruption to increase value and service to your clients – and build competitive advantage when you work with B2X.
Even if you’ve encountered the list of disadvantages above (More cumbersome and political deal regs, etc.) and felt incredibly frustrated.
Even if you watch the constant consolidations feeding upon themselves, growing larger, and working against companies like yours – ones pouring in their blood, sweat, and tears as they grow organically.
Let me explain what I mean by “opportunity”:
To combat the “vicious cycle” of consolidation, B2X exists purely to empower small- and medium-sized resellers who service enterprise end users – or deploy enterprise IT assets.
We find that disruption in any market always brings inefficiencies. And those inefficiencies always create opportunities for anyone looking for them. The challenge, of course, is capitalizing on these opportunities.
As a solution provider focused on helping customers design, build, implement, manage, and secure their IT infrastructures, there’s very little time in the day to study the supply chain, create hundreds (or thousands) of unique relationships throughout the global channel, and benefit from these opportunities.
Additionally, finding the competitive advantage in the middle of disrupting markets usually requires accepting some risk. This is where B2X comes in as a unique fulfillment partner. Our team does study the global supply chain. We already have thousands of vendors + partners deep in the channel who have access to arbitrage opportunities. And most importantly of all, we take huge risks on inventory and future trends.
To capitalize on this, all that’s required is a partnership and open communication with our team. Once we understand the solutions you’re leading with – and the types of customers you’re servicing – the ways for our team to improve margins and reduce the effort spent can explode into a competitive advantage.
Will you take the proactive approach, and use consolidation to benefit your business?
Got a question or idea about consolidation in IT? Reach out to the B2X team >
