EXCLUSIVE: Avnet and Zylotech part ways

Local security surveillance manufacturer Zylotech signed on Avnet as a distributor for its Smart G Enterprise Protection product in December 2008.

In a statement to the ASX, Zylotech's chairman, Peter Granger, said the arrangements between both companies "have not realised the benefits foreshadowed" for either parties and "have generated no revenue to date for Zylotech."

Dai-Kyu Kim, CEO at Zylotech, told CRN in an interview that the sales figures visualised by both companies didn't materialise.

"Both companies decided it was better not to continue the relationship and there was no animosity in the decision," he said.

"It just didn't turn out the way we both wanted. But we have left the door open for any future relationships.

"We will go through the channel we have gone through before, which includes ADI as a distributor."

Kim said the Avnet agreement was meant to take the vendor into the IT segment and now it will go back to dealing with resellers direct.

"Avnet took us into the mass market and we would've loved to have them as strong partner," he said.

"It wasn't that the distributor did do their job, the timing wasn't right."

Kim said Zylotech's internal problems, as reported by CRN in March, didn't help with the vendor's performance.

"I wasn't here at the time to comment on its effect on the Avnet relationship, but during that time all of its channels suffered," he said.

"We are currently implementing other change to the business, which is taking longer than expected.

"We should be able to make a few announcements in the coming weeks."

According to Zylotech's most recent ASX announcement, dated 17 July, the company has also decided not to pursue the acquisition of Trantek Group of Companies from Capital Technic Group, citing "insufficient information being provided to the company" to progress the transaction further.

The company will also not move forward with product offerings from its Sonarcom subsidiary.

Granger stated the cost of reinvigorating the research and development would be more "appropriately deployed in support of a new business strategy".

He stated to the ASX that the company's traditional assets placed it to capture the current trend in the market.

"A new management approach coupled with a stronger focus on software integration will need to be developed and incorporated in the new business strategy," stated Granger.