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Gateway Severs Ties To CDW, DMRs

Posted by inet - 2005-10-10

Gateway has disbanded its group focused on direct marketer resellers (DMRs) such as CDW, reinforcing its strategy of working with solution providers to build its commercial business.

CDW, Zones and other direct marketers that have been selling Gateway products will no longer carry inventory or fixed SKUs. Effective immediately, Gateway is doing only custom-to-order business through direct marketers, said Tiffani Bova, director of channel strategy at the Irvine, Calif., company.

Gateway has mounted an aggressive channel assault over the past year. The company has made a host of channel program enhancements aimed at VARs, including deal registration, market alignment funds, dedicated field resources and improved pricing and margins.

Although Gateway has longtime relationships with most of the direct marketers, including CDW, Zones, Insight and PC Mall, Gateway executives felt the investment in time, resources and money surrounding the direct marketers could be better spent elsewhere, sources said.

Chris Corley, executive vice president of operations for Zones, a $500 million direct marketer, said she was surprised by the Gateway decision. “In the last couple of months, they had gotten more aggressive, putting more energy towards working with companies like Zones,” she said. “This ignores the fact that the line between the DMRs and the channel has really blurred.”

CDW said the Gateway move will not affect its staffing levels. John Marks, CEO of JDM Infrastructure, a Rosemont, Ill., solution provider, called the Gateway move an affirmation “that most direct marketers tarnish margins for solution providers, who actually add value. This may cause other manufacturers to look at the true return on investment through direct marketers.”

Gateway also is stepping up efforts to partner with solution providers in commercial and federal accounts.

Solution provider DLT Solutions has signed a deal with Gateway to become the first member of the PC maker’s revamped channel program that targets the government market. “[Gateway’s] ability to protect us and register deals is important,” said Rick Marcotte, DLT’s president and CEO.

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