Dell appears to be warming to the idea of a two tier supply chain following the revelation that it has signed Hammer to distribute its EqualLogic storage line as well as the entire range of servers, with a particular focus on blades.
Since launching the Partner Direct channel programme, Dell has maintained that it would only work with distributors in niche areas where they could bring something new to the party, as was the case with Micro P which was appointed last year.
Speaking exclusviely to Microscope, Andy Dow, Dell UK channel director said it had never ruled out working with distribution.
"We have always said that they would need to add a specific value and I believe that Hammer does that in terms of reach, credit and next day delivery," he said.
The Basingstoke-based distributor will have standard configurations on the shelf to be shipped within 24 hours, whereas Dell can only offer standard lead times.
The move by Dell flies in the face of the actions it took in May last year by effectively cutting distributors Hammer and Avnet out of EqualLogic's channel, only months after it acquired the storage vendor in November 2007.
At the time, Dell cherry picked the biggest, most lucrative reseller accounts and started to sell directly to them, reducing the rebate the distributors could make which in turn prevented them from investing in developing reseller relationships.
Since then, Hammer has had an informal deal with Dell that allowed it to receive preferential pricing and hold stock but there had not been a contract.
Dow said it had learnt that the full sales potential of EqualLogic could not be realised without the channel but insisted Dell's initial task had been to integrate the storage brand into its company, "now we have the ability to spread our wings".
Tier one resellers can continue to buy direct from Dell but Hammer will have the ability to sell to all resellers, though its focus with be storage specialists and corporate and mid market players said Jason Beeson, solutions sales director.
"I think Dell is on the right track; it still has a way to go in terms of understanding the full potential of the channel but it has certainly taken the right steps," he told Microscope, adding EqualLogic products were in demand from its customers.
In the first three quarters of 2008 EqualLogic saw its sales treble to $18m across EMEA but Eric Sheppard, IDC programme manager for European storage research said that using the strengths of the channel could act as a catalyst for faster growth.
"A huge portion of disk storage systems are sold through distributors and if Dell wants to access as many customers as possible a two tier channel makes sense," he said.
As revealed by Microscope this week, Dell has combined its direct sales and partner teams into four customer facing units covering SME, large enterprise, public sector and consumer. It is expected to announce new internal sales commission structures on 21 January that will also help prevent channel conflict.
One reseller that asked to remain anonymous said the biggest competitor when selling EqualLogic storage was often Dell's direct sales force, however the changes being made should go some way to reducing those instances.