Dell to support the distribution channel by maintaining a healthy competitive environment

Dell to support the distribution channel by maintaining a healthy competitive environment

To bring the slogan into reality “One Nation, One Price, One Voice”, nice efforts were put in by FAIITA and the regional associations with the support of the entire channel community of the country. Mostly all the major brands have agreed to support the channel community, Definitely its a good sign for the channel community as well as the brands.

Dell started its operation in India as online seller, they sold desktops and laptops directly through their online portal without involvement of any partner, but in course of time looking to the strength of channel in India they diverted their major business through channel community. Even the customer in India wish to buy after seeing the look and feel of the product specially when it comes to laptops and desktops because models, colour and looks keep on changing quite often.

It was quite difficult to stop purchases from the brand and run the show, In this scenario, most of the dealers went with the advise given by FAIITA and their association heads by not getting billed from National Distributors and thereby taking support within the dealers. Many offline dealers were carrying huge stocks which were stuck due to the massive festival sales online and this helped to cater the needs within the partners till now.

President and Governing Body of FAIITA, after prudently considering the favourable response received from Dell with reference to submitted Memorandum, has unanimously resolved to revoke the purchase Deferment of Dell products with immediate effect, subject to Dell aligning their regional teams with regional IT Associations and clarify the process of agreed compensation on exceptional disruption of Prices across all GTMs including but not limited to Amazon, Flipkart, Paytm & LFR etc.

WhatsApp Image 2018-12-13 at 9.02.58 AMAll member state associations and federations are advised to further intimate their members to resume normal business with Dell. Notably Purchase Deferment of Asus products continues as per last Advisory till a favourable response is negotiated, WhatsApp Image 2018-12-13 at 11.23.29 AMsaid, Champak Raj Gurjaar, President, FAIITA.

Brands very well know the importance of channel community and its strength, they have given positive answer on the memorandum issued, we hope that things will get alright as we also will be regularly in touch with the brands. Dell has assured to support the channel but has also requested FAIITA to support in helping them to stop the partners who create problem by selling online without registering in their portal, said, Saket Kapur, General Secretary, FAIITA.

WhatsApp Image 2018-12-13 at 12.42.00 AMFrom last month it went completely with issues and discussions, finally all the brands have supported and we are happy about this. We hope that things will definitely go smoothly with all the brands in the future as we need them and without them business is not possible. They are like our god father and its their duty to protect us and at the same time dealers should also support the brands in best way they can, Said, Deepak Bommisetty, Regional Jt. Secy South, FAIITA.

Nikunj Murukutla, Sr.Director, CSB, DELL EMC

Nikunj Murukutla, Sr.Director, CSB, DELL EMC

Based on our previous communications and discussions we had with FAIITA members, please find point wise reply by Dell as given below:

1. Point No.1 of the FAIITA Memorandum: Agreed as follows: Dell, as a rule, endeavours to discourage price disruption over online e-commerce platforms including but not limited to Amazon, Flipkart, Paytm & LFR’s to achieve One Nation One Price 365 days ; Only as an exception, said disruption might happen but Dell endeavours to immediately control it. We at Dell believe in supporting the distribution channel & maintain a healthy competitive environment in the market. Dell has always been supportive & have taken many steps in the past as well, which were appreciated by the channel partners. At Dell, our efforts are to make sure there is no price disruption.

2. Point No.2, 3 of the FAIITA Memorandum: Agreed as follows: In the case of price disruption, Dell will address average end customer price difference between online platforms & retail partners through regular Dell T2 Sell out support Program for the same period. (Pre- information of the scheme will be provided to the channel for big online event days as and when Dell comes to know about it)
For the purposes of the Offers, Dell implemented a mandatory registration of service tag upon sale by reseller having valid sales affiliate code to the end customer to ensure that offer entitlement are passed on to the end customers of Channel. This will enable the end customer to get the same effective price in all registered retail channels. We will be taking corrective actions immediately upon the discovery of disruptive prices if any, which would help our registered partners serve our customers in a more efficient manner. We will revert with the mechanism within four weeks from now.
Terms & Conditions: End customer details are mandatory on RCM tool by registered partners. Dell will enable the end user to get the same effective price in all registered retail channels and will take into consideration the specifications & sub consumer brand of Dell. Dell will take corrective actions immediately upon escalation of any disruptive prices by Dell registered partner. Partner must report sell out on daily basis to be eligible for the above program. This program will cover the sale on the disruption day to the maximum of last 7 days’ average sale. All Tags reported must be purchased from the designated MSA/ ND of the respective region.

Stack configuration prices will be defined by Dell along with monthly RRP, Partner Pay-out will be made post verification of customer sell out details. We will revert with the mechanism within four weeks from now.

For Market place, unauthorized /non-verified partners at various e-tailers
If any of Dell registered partner will sell at market place without any prior approvals, Dell will take strict action as per the Channel Governance Penalty matrix. If any of Dell registered partner knowingly give material to an unauthorized market place partner, Dell will take strict action as per the Channel Governance Penalty matrix which may lead to blacklisting & termination.

3. Point No.4 of the FAIITA Memorandum: Agree as follows, we would inform the registered retail partners about the online sale event as and when we will get to know about the same. This will help our registered partners to stock optimally for those SKU’s / products. Dell will offer all SKU to its respective distributors so that this issue doesn’t arise at all.

4. Point No.5 of the FAIITA Memorandum: Agreed as follows, Dell has taken various steps to ensure healthy retail demand & we will continue to do the same in future as well. Highlighting a few below in this regard:
a) To support demand generation, various activities have been initiated, namely in the Vernacular Paper Print Ads & National media campaign- Along with Dell promos, we provided a detailed list of Dell’s authorized retailers. Social media campaigns, TV ads, and other ATL and BTL activities, highlighting Dell promos along with cash back offers, easy EMI programs, warranty upgrade offers and gift vouchers programs, etc.
b) The launch of Dell Display Program & Foreign Trip Schemes exclusively for the retail community & registered Partners
c) In key IT markets, we have launched “Khushiya Dell Se”- a unique, sure shot scratch and win programs for end customer and channel partners. This is 1st time and exclusive common on ground activity that has been done by any brand to promote registered partners- promoting Dell Sales.

5. Point No.6 of the FAIITA Memorandum: Agreed as follows, Dell will enable the end user to get the same effective price in all registered retail channels will take into consideration the specifications & sub consumer brand of Dell. Dell will take corrective actions immediately upon escalation of any disruptive prices by Dell registered partner. With this partner incentive & rebate for registered retail partners remains intact.

6. Point No.7 of the FAIITA Memorandum: Agreed discussed, we will share the stack price for various models with Dell registered retail partners as and when required or on need basis.

7. Point No.8 of the FAIITA Memorandum: This point will not be valid as we will be creating end user price parity across all registered retail partners.

8. Point No.9 of the FAIITA Memorandum: Agreed as follows, Dell always provides targets as per the market potential & end customer demand, no target is structured with the intent of pushing higher inventory moreover targets are always mutually agreed between partner & dell. Dell will work with open mindedness w.r.t registered partner targets during the period of online sale. In case of Sub distribution business, SD must give visibility of T3 partners on a weekly basis on RCM tool & also get those partners registered with Dell MBO portal as T3 partners. (Post that T3 partners will also be eligible & T3 is only eligible if he is sharing daily end customer details of sell out on the RCM tool)

9. Point No.10 of the FAIITA Memorandum: As discussed, Dell shall make sure transition of outgoing partner is managed seamlessly. The unsold stocks of outgoing partner are taking over by the new or existing partner.

10. Point No.11 of the FAIITA Memorandum: Agreed as follows, Dell will help with end customer programs to improvise sell outs & reduce inventory with channel if any. Dell has already initiated sell out programs in the month of November/December and we will continue to partner our registered partners to drive sell outs. For any further details, please reach out to respective Dell Area Sales Manager or Regional Sales Manager

11. Point No.12 of the FAIITA Memorandum: Agreed as follows, For purchases done between September 25, 2018 to October 15, 2018, Dell will work with Distributors so that partners are suitably supported to make payment by December 15, 2018 without interest. Dell’s process to pay partner rebate pay-out is acknowledged as best in class and is as per the below confirmed timelines to our contracted retail partners. Rebate pay-out is communicated to the partners within 45 days of the closure of the program. Partners then raise the tax invoice to that affect.

12. Registered Partners who have signed targets with Dell in Q4, for the bandh period they would be paid their November pay-out (3rd Nov to 30th Nov 2018) on prorate basis. Dell will give option for T2 to renegotiate their targets for Q4.

13. Going forward all our major schemes will be monthly only, we will not have Qtr. programs for more than 1-2% value if any, we will revisit the same in case of any further requirement.

We would like FAIITA to support us by informing its members about the following:

a. Maximize benefits by registering on Dell partner portal (MBO Connect). (Request all T3 partners also to register on MBO Connect.)

b. Leverage features in the portal like – reporting end customer details, reporting Inventory, verifying distributor invoices.

c. Registering on the portal is mandatory to avail the end customer benefits with respect to offers, price offs and similar programs

d. FAIITA members should discourage incorrect online practices by not participating in e-commerce market place

e. FAIITA will blacklist partners who are selling on market place platforms without authorization from Dell & spoiling the hygiene. Dell will share the names on time to time basis. FAIITA must confirm the action taken on such partners

We look forward to a note from FAIITA confirming the above. Once again, assuring you of our commitment to the channel partners and our commitment to work with FAIITA members to serve our customers in mutually beneficial manner, said, Nikunj Murukutla, Sr.Director, CSB, DELL EMC.