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The Value of Partnerships

{complink 577|Avnet Inc.} recorded its first year of $1 million in sales in 1956. Today, even though we’ve expanded across the globe and have sales upwards of $20 billion, we still remember what it took to get here — strong partnerships with suppliers and customers.

For Avnet's Electronics Marketing Americas (EMA) division our success can be directly linked to the partnerships we formed in those critical early days, relying on our suppliers to provide us, not only with products, but with expert guidance and technical assistance along the way. Throughout the years, we’ve proudly carried on the tradition of partnering with our customers, and working together to help them prosper and grow.

I was reminded of this tradition not long ago when I joined one of our sales managers for a customer meeting. We sat down with a prospective client and, as we do in most meetings, started the conversation by asking the customer what his needs were and discussing how we can help. During our conversation it was clear that this customer needed more than just competitive pricing. He also required engineering support, the ability to buy in small quantities, and the flexibility to shift from placing orders online to working with an account manager, when needed.

I was happy we had the opportunity to share with this customer all the resources Avnet has, tailored to fit his specific needs. Avnet EMA has put together a dedicated sales staff that works with small customers. This team is made up of industry veterans who can offer true guidance and help customers as they develop and grow — or at the very least avoid some of the pitfalls they have seen in their years in our industry.

In addition, we offer a centralized technical support team of engineers who can offer technical advice through the design process, alleviating the extra expense of adding additional resources; and our Website is always available when customers need component information or want to purchase online. In this way, we serve as an extension of the customer’s own team.

At Avnet, we haven’t forgotten the path we’ve taken to get to where we are today. We believe in the importance of building partnerships that last. We also believe in providing our customers with options tailored for their business needs. Whether it be the ability to find what they need online, or receiving the service of one of our dedicated sales representatives or technical experts — we want to help customers of all sizes succeed.

In order to get ahead in your business, you must go beyond just offering basic services to the customer. Success requires building strong partnerships and taking steps to understand your customers' current and future needs.

11 comments on “The Value of Partnerships

  1. Taimoor Zubar
    December 22, 2010

    Phil, I agree that strong partnerships are of high importance in the success of a company and I am impressed by Avnet's strategy of cooperating with small customers and taking them along. However, as Barbara pointed out in her post, other electronic manufacturers are looking to consolidate their forward supply chain and to work with only a few key distributors. Would you consider this strategy to be an effective move? Or does having an intermediary layer in your distribution channel create a negative effect on the performance?

  2. eemom
    December 22, 2010

    I am also curious how you see other distributors in this market sector.  Do they offer the same level of partnership you refer to?  Also, what do see as the OEM's role in this?  I am used to customers interacting with the OEMs requesting their support.  If the OEM wants to get the design-in, they must support the product.  Do you find that Avnet and maybe other distributors are filling a hole that OEMs cannot fill?  Is it specifically at smaller accounts?

  3. kumar1863
    December 22, 2010

    It's tough to get a hold of full market for a single company where one can attain it with the help of other companies partnerships. Avnet is ranked No. 1 in Fortune “Most Admired Companies” list. This will build up and strengthen the relationship between the companies and assure 100% customer satisfaction.

  4. mfbertozzi
    December 23, 2010

    I am really impressed by Avnet sales results achieved. Strong partnerships require often a very long partner's qualification process and several certifications to reach once output's of previous process is positive. Inside hardware market (i.e. telco equipment) it is normal way to work.

    @Phil: (dear Phil) at Avnet, did you conceive specific process for partners qualification in order to speed-up needed steps? It should be very interesting to benchmark yours with qualification's program from others.

  5. Ms. Daisy
    December 23, 2010

    What is clear in the development of Avnet's partnership with its customers is the “active listening” part by its managers. During  conversations with many companies that are trying to push their products out as fast as possible, this ability to listen to all the things the customer needed is often missing. There is also the lack of flexibility to shift from what the company already plans to offer and what the customer is actually stating as their need. It is the genuine partnership and intentional collaboration by Avnet with its customers that helped helped to foster growth in the customers and continued in turn their partnership with the company. Great example in old time business sense!!!

  6. stochastic excursion
    December 27, 2010

    Interned at Avnet some time ago developing test platforms.  Great place to learn and grow.

  7. Himanshugupta
    December 31, 2010

    thanks Phil for sharing this article. Your article share some key points to build a formidable and longlasting partnership with both customers and suppliers.

  8. Phil Sansone
    January 4, 2011

    I can't speak to the level of partnership that other distributors apply to this market sector, but I can say that there are very few distributors out there that can offer the vast array of services that Avnet offers, from the beginning of a customer design, all the way through to end-of-life. And Avnet can take care of their needs in a variety of ways, be it in person, over the phone or via our Avnet Express website. Due to the vast number of accounts that exist in the market, there is no way for any single component OEM to reach the entire market effectively. Distribution fills that gap and allows us to provide technical expertise to support small, medium and large customers.

  9. Phil Sansone
    January 4, 2011

    Yes, we have very specific ways that we measure our partnerships and the mutual financial returns both parties get from the engagement. Suffice to say that much of it is confidential, but I agree with you that it would be interesting to benchmark against others both in our industry, as well as outside of our industry

  10. Phil Sansone
    January 4, 2011

    Each electronic manufacturer needs to determine what their needs are when planning their distribution channel strategy. The benefit of going with a limited channel strategy is that the electronic manufacturer can maximize its relevance to their channel by not diluting the revenue dollars amongst many distributors. This, in turn, can lead to greater “share of mind” within the distributor organization, and result in more resources being applied to that effort by the distributor.

  11. electronics862
    January 27, 2011

    For entrepreneurs looking to build a new business or expand an existing one, a strong partner can be key. For a company to launch products into a new industry sector, partnering with a company already integrated into that sector’s channels  can make market entry easier and more realistic to achieve.

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