Investment in the channel paying off
It is only a couple of years since Fujitsu UK’s executive director, Technology Products Group, Michael Keegan, took over his channel role, but since moving from the firm’s services arm he has overseen big investments in transforming its hardware channel business.
The investment appears to be paying off, so far at least. Fujitsu now has 1,000 partners in the UK channel selling its hardware, including around 115 accredited partners joined to its Channel Acceleration programme – a fivefold increase from under two years ago.
Its own channel-facing staff headcount number is heading past the 60 mark with a recent influx of staff to support partner growth, while simultaneously looking to swell its partner ranks.
This is a major change for a vendor that only a couple of years ago was doing nearly all of its UK business direct. These days, two thirds is now indirect, while the proportion of direct-indirect sales was “more like 90-10” previously, Keegan says.
“Its a massive change in our business,” he told ChannelBiz UK, adding that proportion of revenue going through the channel is likely to further increase over the coming months.
Turnover through the channel is expected to be in the region of £100 million this year, and Fujitsu is now fighting to claw even more business from the traditional hard-hitting channel vendors. Keegan is adamant that resellers are open to such a change.
“It is a matter of challenge for me that we get our rightful market share in the UK by being more present in this market,” Keegan says.
“What we find as we go around the resellers and other partners in the channel is that they are very open to having good propositions from us, because they have had quite a restricted choice in the past.”
He says that in many cases its competitors “haven’t really paid a lot of attention to resellers”, and have relied just on brand loyalty for many years. “I think resellers want more than that now,” Keegan contends.
Convincing rival vendor’s partners to shift allegiance to Fujitsu is no small feat however, and over the past 18 months the vendor has had to make big investments in the channel to entice partners, as well as setting up its channel programme and unveiling its Global Cloud Platform in the UK.
However he says that rival vendors have also given ample opportunity for Fujitsu to increase it share of the channel.
Keegan says that the channel is far from a closed club as far as the hardware business is concerned, and is ready to pounce on any opportunities left by rivals – such as HP’s discussions to spin off its PC business.
“When one of the larger competitors decided to question their commitment to the channel, the week that happened the phone never stopped ringing,” he says, referring to the proposition put forward prior to Meg Whitman’s appointment at HP.
“A lot of resellers felt very let down, and it woke them up to a business fact that you need more choice available if you are a reseller.”
Of course the flip side to this is that Fujitsu faces its own challenge in convincing resellers of its long term commitment to the channel, having had only very small footprint in the past.
So why has it taken Fujitsu so long to make its presence felt in the channel in the UK? Keegan says that this was largely for historical reasons, with Fujitsu traditionally focused “almost entirely on its services business”, an area where it is in the top three behind IBM and HP, as well one of the top providers to the UK public sector.
This has not always been the case in other parts of Europe though, with a large channel presence in Germany, as well Asia-Pacific markets.
“All that has changed immeasurably,” he says, “my message to resellers and the channel is check out Fujitsu now because a lot has changed – don’t rely on your old historical view of Fujitsu as only a direct company. We are a major indirect player now and we are growing fast.
“The major challenge has been that we had to wake up ourselves, and reach that understanding of why weren’t big players in product market in the UK, when we were big players in other markets.
“The second challenge was a lot of people have an old fashioned view of us based on several years ago, which was the right view to have of us at the time.”
A lot has changed though he says, and the challenge has been getting people to “wake up to the fact”.
“We are delighted with the growth with our channel partners, with our business and with their business that we are seeing as a result.”