Avnet’s hunt for local and global growth

Earlier this month Avnet completed the acquisition of Melbourne-based distributor ChannelWorx. At the time of the deal Avnet spoke of an increased aggressive approach to the market. While on a whistlestop tour of Asia-Pacific, CRN was able to have some time with Rick Hamada, chief operating officer of Avnet. Joined by Gavin Lawless, general manager of Avnet Technology Solutions Australia, both were able to talk openly about the distributor’s global and local plans.

CRN: What is your view of the local market in Australia and Avnet’s position within it?

Hamada: We believe our value proposition can play here and our fundamental value proposition is founded on reducing complexity, reducing uncertainty, and accelerating success for our partners. That is really what we are built on. The way we do that in Australia may have some unique attributes to how we do it in Texas, or Arizona or Germany, but the fundamental value proposition is if you engage with Avnet we will help make you more successful. The fastest way for us to grow is to help our partners grow. We are committed to that fundamental principle.

What is interesting about being part of a global team is what we can learn from the way we are solving that problem or delivering that value in the other areas.

CRN: Avnet has a huge presence in the US and across Europe, how do you leverage that in Australia?

Hamada: There is a whole load of customers doing business across multiple regions today, but from our relationship with IBM point of view – ideas that work and growth strategies that get traction we can immediately transport and expose. The number one goal is to be the best distributor in Australia, then we are going to work on being the best distributor in Asia-Pacific, then we are going to be the best across the globe. The priority is, for the Australian market, that we want to be the best in Australia. Hopefully the global scope and scale of Avnet can add value to being the best distributor in Australia.

Lawless: Our US business is a mature business. In terms of maturity (in Australia) we are at least 12, maybe 24 months behind what our US business does. So we don’t have to relearn anything. Yes they are different marketplaces, but a lot of the practices in the US we can bring down. We get a lot of guidance from the US in terms of what they are doing, where they are going, how they are selling solutions and we bring that down into Australia.

CRN: How are you going to reach that aim of being the best distributor in Australia?

Hamada: The team here is the expert on the business in Australia. Hopefully from an Avnet global perspective we have some unique leverage points regarding scope and scale and relationships with IBM at a higher level that can influence to make things happen out here for the benefit of the Australian channel. The local team adds its value by knowing what makes sense for the local market.

Lawless: From a local point of view, Avnet as a distributor in this country is fairly young. When we started in Australia we were a system integrator and we have been operating as a standalone distributor business for about four years. So as a distributor we are fairly immature in this market. In the past 18 months in particular we have started to get some good momentum in this business for various reasons: we have been broadening our vendor line-up – we took on HP three years ago, we have signed three or four mid-tier vendors in the past 12 to 18 months. We are getting momentum with our business, our revenues are considerably accelerating. We are now at a point where we can get very aggressive in this market. For us to be one of the top distributors in a very short period of time on the back of the foundation we have laid, the aim is very doable. In the next 12 to 24 months there will be a lot happening in this business. The bottom line is that we have laid a good foundation and we are aggressive in this market in terms of growing our business and being one of the top distributors in Australia.

CRN: How does the decision-making process operate between the US and Australia? Is the Australian business run as a separate entity?

Hamada: We are very decentralised when it comes to sales and marketing strategies, customer and supplier relationships and how they manifest themselves in local marketplaces – this is up to the local management team. We are very light on corporate mandates. We influence things such as global IT tools, we are not going to have Lotus Notes in one region and Microsoft Exchange in the other. For contextual activities we use standardisation as much as possible. First it is Australia, second is how does it play in the Asia-Pacific region and third is how does it play globally. We see more balance coming to Asia-Pacific as we make more investments here and build out our total computer business and this creates opportunities which are unique to that region and in some cases unique to Australia.