Anixter / Bosch Sells Direct to Amazon

Published Jan 18, 2017 15:05 PM

Anixter regularly says they do not sell direct to end users or that they do not do it anymore. However, over the past year, Anixter has sold Bosch video surveillance products direct to Amazon for Amazon's internal facilities, IPVM has learned.

Inside this post, we examine what is happening and the concerns the move brings, especially in light of Anixter's ongoing practice of selling direct.

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*** *** **********'* ****:

Comments (74)
UI
Undisclosed Integrator #1
Jan 18, 2017

Already boycotting from years of seeing this occur in retail.

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MM
Michael Miller
Jan 18, 2017

Interesting as I thought Amazon was using Arecont/Exacq and/or Cisco end to end.  

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Brian Karas
Jan 18, 2017
IPVM

Amazon has certainly used other products previously, this post is about recent purchases. We also verified this with several sources directly involved in the matter.

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UI
Undisclosed Integrator #8
Jan 19, 2017

I work in sales for a national dealer/integrator where the margins include preset administrative loads well before the GM is added.  The real driver for any deal is the RMR services.

I've always wondered why we don't sell with total transparency by illistrating our cost w/minimal markup to our end users, labor components (for both design and installation) and have materials drop-shipped to each site (whether from distribution or from manufacturers that don't go through distribution). 

The obvious answer for a company like mine is that they cannot afford to take the hit on install margins, won't be able to provide the admin and support that the loads pay for, etc. but I also have to believe that there would be an significant uptick in business, particularly RMR services. 

As an aside, I've only been in the security business only for around five years, coming from an unrelated industry. So my perspective may be a little uninformed and not very popular. 

JH
John Honovich
Jan 19, 2017
IPVM

The real driver for any deal is the RMR services.

#8, that is a good point. I am curious though, how many larger customers do not want to enter into an RMR contract for video surveillance systems? In our experience and surveys, it is typical for large companies to want to buy product and service as needed, not as a whole RMR offering.

Related post: An Honest Integrator On The Truth About RMR

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CZ
Cliff Ziegler
Jan 18, 2017

Do we all remember when the lumber/hardware stores open up to consumers?  In the beginning all trades were up in arms with what that will do to their trade and take away business from them.   How could they survive? when they can’t sell the material and the labour, I remember this quite well being in the construction industry 20 + years ago. They survived, actually they adapted and overcame all the negatives.  New companies sprouted, catering to a consumer buying material and hiring an expert to install it.  Your forgetting, the intellectual property that we as integrators have- it’s the smarts to keep the IP camera connected and installed, and sending video over an ever-changing IT network that is usually installed on a foundation of quicksand.  This, in my mind, is where we will always add value, its providing the solution and working with the end user on their sales journey.

18 years ago, end users couldn’t shop our prices and we were the matter experts, not anymore- you can find whatever you need on the internet. The end user now has the tools to be able to provide comment and suggestions, we as integrators can still provide guidance and recommendations during the sales and installation of the project.  If the end user has taken the time to investigate these products, that good thing.  It means that they are more invested in the overall project, and they will take the time and invest more in your company, providing you long term service contracts.  It’s time for our industry to adapt, unfortunately manufacturers are always looking to keep their numbers up and that means more creative (and uncomfortable) direct selling through other channels. Those integrators that don’t adapt, may be left with dwindling sales and loss of business in future years.

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UM
Undisclosed Manufacturer #2
Jan 18, 2017

Cliff, that is all well and good, and the manufacturer's right to do so. But don't say one thing and do another. That may not be the only issue people have here but it is a big one.

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JH
John Honovich
Jan 18, 2017
IPVM

Those integrators that don’t adapt, may be left with dwindling sales and loss of business in future years.

Cliff, I agree.

On the other hand, those security distributors who come out and say "Yep, we will sell direct to end users anytime we can" will suffer an immediate sizable loss of business from integrators, ergo why Anixter tries to have it both ways.

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UI
Undisclosed Integrator #11
Jan 19, 2017

I tend to take the complete opposite view on this subject.

I find it curious that so many in our industry are so willing to allow others to control the outcomes and are satisfied to merely "adapt" to those outcomes. 

 

I would suggest that the contractors in the home improvement building industry who are successful and profitable are the ones who did NOT adapt to the "Home Depot" business model, and had the brains to concentrate instead on their value-add and capabilities. The ones who did not can usually be found on Home Depot's list of "installation contractors", where they will install windows you purchased at Home Depot for cut rate and in accordance with Home Depot terms and conditions - in other words, Home Depot controls your business to a great degree. Who in their right mind would want that for their business?

Allowing the equipment and materials to be separated from the solution equals the death of your profitable business, and turns you into the "hired help" and allows potential end-users to easily shop the job based solely on labor rates.

The auto repair industry has successfully resisted the "do-it-yourself" auto parts warehouse chains, and it is virtually impossible to find an auto repair shop that will allow you to buy a transmission at Pep Boys, cart it in to the repair shop and ask for a price to install it - the repair shop will tell you to get lost, as the parts and the labor are delivered as one, and they don't care that you can get a throttle body at Pep Boys for 12 dollars less. 

Let's start thinking more like auto mechanics and stop panicking over moves by manufacturers - let's not forget something very important - the vast majority of end users have no capacity or willingness to survey, design, pull permits, install conduit, drill holes, pull cable, get on extension ladders, design and configure VMS servers and related networking. They are always going to need an integrator to do that. only the smallest and simplest jobs can be done by do-it-yourselfers. As such, integrators have the power.

So decide - allow Anixter and Bosch, etc to control your destiny, or control it yourself. 

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KL
Keefe Lovgren
Jan 18, 2017
IPVMU Certified

Good read.  I remember about 10 years ago when ADI sold Honeywell Video products direct to Menards (midwest big box company) and it upset many integrators. 

I don't fault either ADI or Anixter for doing so (voted "yes" on the first question) that is capitalism, a buyer and a seller being willing participants in commerce in a way that they wish.  However, I don't agree with Anixter (or ADI) in those situations and feel they could have explained to the potential customer their position about selling to end users and directed them towards a local or national integrator. 

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SB
Steven Burman
Mar 28, 2017
I worked for ADI in the '90's, and they sold direct to plenty of end-users. Fry's Electronics bought hundreds of thousands of dollars worth of gear from them. All of the major school districts had accounts.
UM
Undisclosed Manufacturer #3
Jan 18, 2017

This is a tough one as a Distributor should never be selling direct. Right?  

But, what if the end-user, who is going to spend $10's of Millions will only negotiate with the Manufacturer?  If the Manufacturer will not do that they are eliminated from the opportunity. Also note, there never was an Integrator involved.  The Manufacturer did all the work and it took them a year or two to get to this point.

So, the Manufacturer negotiates the deal direct with the understanding that the Distributor will be the supplier and the Distributor agrees to "X" percentage points on the deal.

In a case like this, they exist, the Manufacturer sticks to their commitment not to sell direct.  The Distributor takes a pass through sell that is direct to the end-user.  

It was either this or lose the deal as plenty of Manufacturers will sell direct.  Should they both have walked away from a multi-million dollar opportunity?  how many integrator's do over $10M/year with one Manufacturer?

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JH
John Honovich
Jan 18, 2017
IPVM

But, what if the end-user, who is going to spend $10's of Millions will only negotiate with the Manufacturer?

I've seen this before and it can work.

Yes, understandably, a mega end user will want to negotiate price direct. They do not want each installer in each city to set random prices.

So let's say Manufacturer M negotiates and agrees on a price of $100 for Mega End User U.

M can then say "U, you will buy it from integrators and we will ensure you get the price of $100." M goes to the integrators and then sets up special pricing for that deal. "Ok, Integrator I, we are selling these products to U for $100 each. For this deal, I will sell them to you for {insert price - $90, $85, $80, etc.} and you will then charge U $100 each."

Net/net the manufacturer ensures the integrator is cut in. By the way, this is not hypothetical, I have seen mega projects sold this way.

Agree/disagree?

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UM
Undisclosed Manufacturer #3
Jan 18, 2017

It always depends on the total scenario.  

Is the end-user using the integrator to do the installs? Are they using different integrators around the country.

Several large companies have already negotiated nation wide installation agreements with companies that can do it all and will not be using a traditional Security Integrator to do the install. These companies get certified and know the end-users requirements backward and forwards.  As they are held responsible for the installation Nationally it insures that the end-users needs are known and the installation is consistent from site to site.  There is also only one throat to choke.

In this scenario, the Integrator, has brought nothing to the table and adds no value.  Adding them on as pass through adds cost, as everybody needs to make something, with no value added.  These large end-users know this.

In your scenario, Distributor "Y" needs "X" percentage.  Integrator "Y" needs "X" percentage. And, of course, the Manufacturer needs "X" percentage.  Those percentages add up.

While integrator may, understandably, fret over these types of deals, it really isn't going to be worth their time and effort anyway. They are integrators and not well suited to handle the stocking , staging and shipping requirements (not to mention the cost associated with each) of these types of deals.  It will cost them and they will regret it in the long run as it will take away their focus from what they do really well.

I think these deals are rare but they do happen.  Each one needs to be taken on it's own merit.  The problem is that the Headline is released and 99% of the details as to why are not.

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Brian Karas
Jan 18, 2017
IPVM

Is the end-user using the integrator to do the installs? Are they using different integrators around the country.

Yes, and yes. I spoke with a senior person at one of the integrators involved, I believe there are multiple integrators involved. 

Based on the conversations we had leading up to this post, this is what would ordinarily be considered a "standard" deal in security. Well-known integrators are being used, and the scope of the project is not outside of projects they have done previously where the hardware sale flowed through the integrations.

In this scenario, the Integrator, has brought nothing to the table and adds no value.

Their argument is they were never given the opportunity to pitch their value prop. It would be different if Amazon heard their pitch and said "Nah, we got people that can do that, we don't need you.". But here the integrators are being asked to install and configure the product and are also (from what I was told) being asked to "fix" situations where the results from a given camera did not meet expectations. Because they did not design or sell the components, they are more restricted in what they can do to swap components out or solve these problems.

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Luis Carmona
Jan 18, 2017
Geutebruck USA • IPVMU Certified

But here the integrators are being asked to install and configure the product and are also (from what I was told) being asked to "fix" situations where the results from a given camera did not meet expectations.

I would hope any integrator engaging in that would not pigeon hole themselves into a situation where they could not request a change order. If they committed themselves to fixing the unknown, wouldn't they be responsible for the risk they took?

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JH
John Honovich
Jan 18, 2017
IPVM

In your scenario, Distributor "Y" needs "X" percentage.  Integrator "Y" needs "X" percentage. And, of course, the Manufacturer needs "X" percentage.  Those percentages add up.

Sure, don't cut the integrator in there. And then when the integrator cuts the manufacturer out on the next deal, the manufacturer loses there.

If it is a 'partnership' like they like to say, partner. If it is not and you are going to cut them out, expect to be cut out in turn.

It's not like camera manufacturers don't have any rival that integrators can turn to.

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UM
Undisclosed Manufacturer #3
Jan 18, 2017

Please read my response to Brian.

MF
Michael Fusco
Jan 19, 2017

Agree. This is done all the time, usually facilitated by the end user's "consultant" and whatever manufacturer the consultant is colluding with, er, collaborating with. The manufacturer then establishes a "board price" discount with one or more distributors wherein all integrators bidding the job will have access to the same standardized pricing. 

The mark-up is usually left up to the integrator. This process makes it easy to level the bids, since the only differentiators will be the markups. 

the distributors generally do not drive this process. It is generally the manufacturer's rep working with the end user's consultant or engineer in establishing a global standard for the company or govt agency.

i have stated on a separate thread that distributors are generally not the bad guys. The manufacturers have an army of manufacturers' reps out there generating demand for their products and most importantly aggressively calling on mid-sized and large corporations to get their product "spec'd in" there.

this is all occurring long before the integrator gets the plans and specs to bid on.

 Of course there is nothing stopping integrators from doing the same thing, but most do not have the inclination or deep enough pockets to engage in business development at that level and wait for the very long sales cycle to bare fruit. 

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Brian Karas
Jan 18, 2017
IPVM

If the Manufacturer will not do that they are eliminated from the opportunity.

 

Maybe not.  This is basically a "Prisoner's dilemma" situation.  If ALL manufacturers and distributors hold to the "no direct sales" policy, then the end user is forced to purchase through the standard channel.  The problem is that even though the "best" solution is to hold the line, the temptation to take advantage of the opportunity can be significant.

But, what if the end-user, who is going to spend $10's of Millions will only negotiate with the Manufacturer?

This is not uncommon for large projects, end-users want to know that pricing is going to be consistent across all sites involved in the project.  In those cases the manufacturer can also choose to bring in a number of key integrators, and setup a negotiation where all the integrators agree to sell the product through at a fixed price, and most likely with lower margins than they might have gotten on their own, but at least they get some part of the hardware sale, and the end-user gets a predictable price.

The Manufacturer did all the work and it took them a year or two to get to this point.

In cases like this, the manufacturer certainly did all the work that was done, but the argument from some integrators is that they did not do ALL of the work required for a full and complete solution. Integrators also argue that manufacturers might have more incentive to spec their own products into areas where that product is not the best overall fit, it is just the best fit that manufacturer could offer. Whereas if the integrator were doing the design they would use the best product overall for any given requirement.  

Of course, it is never this perfectly black-and-white, but just because the manufacturer is at least partly playing the role of the integrator here does not mean they have a justified reason for supporting a direct sale.

It should also be emphasized again that all this revolves around a manufacturer or distributor claiming to "respect the channel". If either is upfront and open about the fact that they may sell direct when it suits them, the integrator's position to argue or claim harm is essentially zero, but in that case they at least know what they are up against and can choose to work with that manufacturer (or not).

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UM
Undisclosed Manufacturer #3
Jan 18, 2017

Please see my response to John above.  When you do not know all the details it is easy to jump to conclusions.  The only way to know all the details of the Bosch deal, or any other one, is to sit in that negotiating chair yourself.  You may not agree with the decision being made.  But, you also do not have more then .5% of the information that went in to the decision.

Really it should come down to "Has my chosen Distributor or Manufacturer" ever screwed me.  If they have, find another one.  If they haven't it is a moot point.  Why complain about not getting a deal you would have never gotten, and probably never knew about, anyway.

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Brian Karas
Jan 18, 2017
IPVM

I had several conversations with people directly involved in this deal. I am not claiming to have 100% knowledge of the entire process, but having run a sales org for a manufacturer, and spent several years in outside sales (including working closely with many of the companies involved here in various aspects), I think the information we reported is an accurate representation of the situation.

If you have information that is missing, or know something specific, please feel free to share it, but do not assume we are "jumping to conclusions" here.

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UM
Undisclosed Manufacturer #3
Jan 18, 2017

Brian:  With all due respect, the article does not have a lot of details.

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Brian Karas
Jan 18, 2017
IPVM

Your comments are implying that we are missing key details and could be misinterpreting the situation and turning a legitimate end-user direct sale into a issue where there should be none. I disagree with you, and have not seen you offer anything other than speculation about this.

We spoke to multiple sources on this. I cannot disclose some of the details without revealing those sources (or which company they are from), but I can tell you that nobody we spoke with gave any indication that the scenarios you proposed that would make this an "understandable" situation were how it went down.

I do agree that there may be cases where some form of end-user direct sales take place, and integrators have zero opportunity to participate in those for whatever reason (I was involved in one such arrangement specifically with a federal government entity that used 100% internal labor, all fully trained and certified on their vendors). From the research we did on this, this is not one of those scenarios.

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UM
Undisclosed Manufacturer #3
Jan 18, 2017

Brian:

I am not looking for an online fight.  This is in no way personal to me.

But, you have details that I do not have.  Details that you are unable to share. So, you have left me to assume. Please do not slam me for not having all the details. I can only work with the information I have while trying to bring up points that may be valid. I was married, so I know I am never right!

I do not have a dog in this fight.  I have no reason to defend either Anixter or Bosch. In fact, I could use this against one of my competitors if I chose to do so.

Net Net, for me, each situation has to be determined on it's own merits.  As I said before, if a Manufacturer, or Distributor, that and Integrator works with screws them, then they should work with someone else who won't.  There are plenty of options.

MC
Marty Calhoun
Jan 18, 2017
IPVMU Certified

Get used to it, its a standard with all the 'distributors'. They are so badly beaten up by online sales that they will go to any extreme to make a sale. None of them make the numbers they did 3 years ago. And guess what, it will get worse for them.  A birdie once said that it is everyday business at ADI to sell to anyone with cash, Wholesale Only thats Baloney, no personal checks please! (too much hassle making deposits I presume?)

Distribution does not care about you Mr. Integrator so that means find the best direct lines for the products you need and hope you NEVER NEED a Distributor again.

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Laura Garest
Jan 19, 2017

I'm so sorry that you've had such negative experiences with distributors.  We are not all vicious money grubbers.  Some of us actually take pride in doing right by our customers. I have worked for the same distributor almost 18 years.  Over those years I've seen end users & their projects come and go, but I have partnerships with Integrators that I value above all else.  It is unfortunate that some of the big distributors in the market engage in unsavory business practices and give us all a bad rap.  

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MC
Marty Calhoun
Jan 19, 2017
IPVMU Certified

Thank you for making my case, if you have been working with end users, well, thats not my idea (and quite a few others as well) of a wholesale only security supplier?

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Laura Garest
Jan 19, 2017

Yes, I was agreeing with you. Perhaps I should have worded it better?  I have seen end users & their projects that I've worked on with Integrators come and go.  The point being that it makes no sense as a distributor to ruin what could be a career long partnership with an integrator for one project, even if it is very large, if a distributor intends to survive in the long term.

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UI
Undisclosed Integrator #5
Jan 18, 2017

Just add it to the list.  If you spend your money with Anixter, Tri-Ed, Accu-Tech, Clark, or any of their other brands, you are literally giving money to your competitor.  

It's just bad business.

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Jon Dillabaugh
Jan 18, 2017
Pro Focus LLC

Just another reason I would never consider opening an account.

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UM
Undisclosed Manufacturer #2
Jan 19, 2017

But Jon, couldn't the same thing be said about Hik? Yes, one is a distributor and one is a manufacturer, but Hik seems to make no efforts at keeping their products channel centric, right?

Amazon Sales of Hikvision China Cameras

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U
Undisclosed #6
Jan 19, 2017

I get Ezviz spam daily from Newegg and Amazon.

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UM
Undisclosed Manufacturer #2
Jan 19, 2017

In Hikvision's defense, I think Ezviz was always designed and targeted towards the consumer market.

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Joe Mirolli
Jan 19, 2017
IPVMU Certified

I think Amazon uses more product that can be distributed through Anixter than most of us here combined. 

That being said, I voted no they shouldn't sell direct, but that's just me looking at it from the outside in. I don't fault them for selling direct to a customer such as Amazon who's primary and/or secondary business are automated packaging lines and data centers around the world. The last thing Amazon wants to do is deal with middle men slowing the flow of our data. I even doubt its price related. 

However Anixter selling to healthcare companies and other unrelated data and automation centric businesses is a different story. 

What gets me is that some reps aren't honest about it. In our 25 year history we have seen both types, but I have not received a response from any that flat out say no we dont sell direct to end users. It mostly some propaganda around some strategic account that has a long history with blah blah and they just want to work direct with us.....

Anyway, we buy from Anixter and companies but we don't buy from "them" we buy from our dedicated reps that take great care of us and provide us an extension of our logistics operation. 

Now consider this, if a manufacturer offered to sell direct to you for less cutting out distribution would you? I'll be honest Anixter, Unfortunately for you I would on allot of items. Not all but the core, probably. 

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UM
Undisclosed Manufacturer #7
Jan 19, 2017

Published for the 1st time on the same day as IPVM's Bosch/Anixter/Amazon story I believe

JH
John Honovich
Jan 19, 2017
IPVM

#7, but what they are saying is that Hikvision UK only sells products through authorized partners. But the Hangzhou Hikvision Digital Technology Co. Ltd., their corporate parent, sells almost identical products to a vast array of large and small parties across the world. Ergo, the need for them to run this notice, after we published Amazon Sales of Hikvision China Cameras.

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CR
Christopher Reider, CPP
Jan 19, 2017

Another thing to think of is that with the size of Amazon it is not unlikely that their internal IT or facilities maintenance dept at distribution locations has the know how and technical capabilities to perform their own install and system programming. In this case why would they need an integrator? It is as simple as one of us buying from ADI and self installing the system in our home or business. Why out source it when you can do it yourself?

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JH
John Honovich
Jan 19, 2017
IPVM

has the know how and technical capabilities to perform their own install and system programming.

Chris, it's Amazon. They also have the know how and technical capabilities to develop their own VMS ;) Indeed, we have heard numerous stories over the years about Amazon threatening to do so.

In general, mega IT companies still have outsiders provide software, hardware, install and support services because it is less expensive than doing it in-house.

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UI
Undisclosed Integrator #5
Jan 19, 2017

The issue is that Anixter has lied about it repeatedly over the years.  They say that it doesn't happen - or it doesn't happen any more - but there's this long list of examples that just keeps growing.

Want to sell direct?  Great.  Be honest about it.  Tell the manufacturer that you're going to sell their stuff without supporting it.  Tell the integrator that you want them to buy from your warehouses, even though you're going to be bidding against them using wholesale prices.

It's the old "have it both ways" problem.

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MC
Marty Calhoun
Jan 19, 2017
IPVMU Certified

Why? Because ADI, Anixter and many others CLAIM to be Wholesale Only suppliers that NEVER sell to anyone that does not have a security license and business licence for same in the particular state, That is supposed to protect folks that buy 100's of thousands of dollars every year from the same price gouge as Joe Blow that spends $1000 ONE TIME.

Dont matter who or how big, No License, No dice, period.

UD
Undisclosed Distributor #9
Jan 19, 2017

I'm curious to know what the mimimum margin percentage an integrator would be willing to earn on hardware, in order to get the installation and service business, in a situation where a manufacturer handed them a deal like this (pulled through distribution).

NOTICE: This comment has been moved to its own discussion: What Is The Minimum Margin Percentage An Integrator Would Take For a Deal a Manufacturer Handed To Them?

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Buddy Mason
Jan 19, 2017

Anixter is doing this to us right now.  We turned a school district (that we have done over 2 million with) on to a product and since the school wanted to try it out and not involve us at this time they purchased the product from Anixter at a very low price.  I called the manager and he stated that they sell direct on all products except for security, which this is a paging/clock product.  Never heard that one before.  So we had the talk again about when the proof of concept is done and they are ready to spend the bond money ($1,000,000) to secure the product for 45 buildings "installed" how was Anixter going to handle it?  Two issues here is that Anixter chooses to not have relationships with the main integrators in town because it makes them feel better about selling direct to end users.  The other issue is when they get caught and or called out on it the real pricing they gave the end user surfaces and there is zero margin left for the integrator.  They buy at wholesale, mark up to us typically what they would sell to the end user.  When I called the manager he said there should be plenty of margin for us, at least around 15 points.  Obviously they have never ran an integration company, you cannot survive on that margin to the end user. It has been over three weeks and still not another call to tell me what they can do for me price wise to try to make it right...and I have left message.  I called the manufacturer who is pretty new with Anixter and over a long conversation they said they will talk to upper management with Anixter to see how this happens.  Let me just say they don't give a crap how they sell their product until integrators like us go to our customer and change it to a different product, which sometimes we have to do to make any money.  But of course the customer already knows what he should be paying for a speaker/clock. 

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Undisclosed #6
Jan 21, 2017

When you sell Avigilon, do you feel bad for Anixter?

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UI
Undisclosed Integrator #10
Jan 19, 2017

Just a few months ago I posted a comment about Anixter and Bosch snaking a 7 figure sale from out company and how I was urging all of you to buy from someone else. I had full visibility to this deal as well. There are more. Keep peeling back the onion and you will find more. This IPVM community hammered back at me vouching for anixter. However based on the results from this survey it seems the opinions have changed. We as integrators have an extremely strong voice and it is with our purchasing dollars. If you continue to buy from anixter you will get bit. Take it from someone who knows first hand. Buy from someone else.  

The same goes for Bosch. With their recent move to take the b series line to distribution completely diluting their dealer direct model you should find another security manufacturer. Keep in mind there are limited to no requirements for an untrained inexperienced person to buy this equipment. You are now sharing tech support (should you need it) with lines clogged by idiots. 

Use you $$$ as your voice.  Don't hesitate to tell your reps why they have lost your business. 

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Undisclosed Integrator #12
Jan 19, 2017

We have been boycotting Anixter for many years (15+) and we purchase over $5M annually from Anixter's competitors. Over the last 10 years, our purchases are well in excess of $50M! These are sales orders/revenue that Anixter has lost over stupid decisions like this one, for what is described as a $10M opportunity.

And we are only one (1) Integrator. 

Of the 75 IPVM members who voted above on Boycotting Anixter, 87% (=65) of the responses say yes "Boycott" so take 20% of our volume = $1M annually x 65 and look at a $65M annual loss from just your responders!

Our company policy is and will remain; any employee who buys as much as a single connector from Anixter, will be subject to disciplinary action including termination.

The excuses that "we don't do that anymore" or "we have stopped selling direct" is an old song that honestly, we have heard before.  Anixter must think that the Integrators are not smart enough to find an alternative.

Unless Anixter is greasing the palms of Integrator's employees... who is make decisions to purchase from them and, why would anyone do business with any company that is willing to go behind your back and, cut your throat?

Non Anixter Integrator -

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Undisclosed Integrator #11
Jan 19, 2017

Agreed. Integrators have the power. 

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UI
Undisclosed Integrator #13
Jan 19, 2017

Distribution does not care about you Mr. Integrator so that means find the best direct lines for the products you need and hope you NEVER NEED a Distributor again.

Marty, I agree with you 100%.  I work very hard at finding manufacturers who do not use ADI and Tri-Ed/Anixter for distribution and use them only for mics. parts, connectors, etc..  I have had customers who were not in the industry ask me to give them part numbers (which I do not include on my proposals) because they have an account with ADI or Tri-Ed/Anixter and they would like to save money on the install.  Also, I have made it my policy not to install equipment supplied by the customer or others.  I believe there is enough business out there to avoid this scenario.  I also find that customers interested in purchasing their equipment from someone besides me to pretty much just waste my time.

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Marty Calhoun
Jan 19, 2017
IPVMU Certified

Thank you, there is a major difference in what a distributor offers you when you buy a part and what an integrator GIVES you when you buy the part from them. You get our knowledge # 1 and we support you after the sale # 2.

Call Anixter and ask them how to program anything on anything and see what you get!!

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UI
Undisclosed Integrator #14
Jan 20, 2017

Where can I apply for a Physical Security Engineer job at Amazon ?

They'll surely need a Bosch Ip Video expert... :)

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JH
John Honovich
Jan 20, 2017
IPVM

Where can I apply for a Physical Security Engineer job at Amazon ?

Surely, Anixter can help there...

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UM
Undisclosed Manufacturer #2
Jan 23, 2017

We laugh but this might be the evolution of the Security industry, same as the IT industry. Those that really know what they are doing end up getting full time jobs with the larger companies who can afford them. Those left end up joining the growing glut of small timers in the race to the bottom for pay and profit in an every commoditizing industry. 

UM
Undisclosed Manufacturer #15
Jan 21, 2017

Come on guys, Anixter idea that they can sell Bosch  through Amazon is a short lived dream. They can enjoy it while Amazon collects data and bybass them as soon as they see it's fit. We work with Walmart and they already buy direct from Bosch. When a company is struggling, the CEO might make short term deals to make the investors happy. I believe that's what Bosch is doing.

Marty, I follow Your posts on IPVM. I respect your feedback but I think company Security owners should except the fact the technology is going after DYI installation with automated Support. Cisco got it down 5 years ago. 

I would love to argue the case.. I just don't see it.

UM
Undisclosed Manufacturer #16
Jan 23, 2017

I almost never comment on these strings, but am going to chime in here.  There is a basic principle that needs to be considered, and that is every business' right to make the best decisions for their customers, and ultimately their shareholders.  That is what Bosch/Anixter are doing here.  Now I get the sensitivity knowing that distribution typically gets better pricing and operates off lower margins on hardware that integrator, and that should be considered by the manufacturer when pricing a project like this. But the bottom line comes down to this:

1.  Manufacturers have an obligation to grow and protect their market share.  Time and time again the integrator community (with many exceptions) have shown a willingness to create many partnerships, drop manufacturers and more, so why shouldn't they develop end user relationships, and even sell directly?

2.  Integrator are highly skilled, and have an obligation to their shareholders/employees to grow and protect their market share (I love Cliff's example of the lumber industry).  As I said in point #1, integrator will often have multiple partnerships and will mandate that companies compete for their business.  This is their right - and a smart business practice.

3.  Distribution...... etc, etc, etc.  See points above.

I love the movie Moneyball.  If you are passionate about selling, watch it again but with your sales hat on.  There is a great line that Cliff is illustrating.  Brad Pitt says "adapt or die".  Respectfully these message boards often illustrate that integrator are most resistant to adapting in our business.  These types of posts and deals are not going away, so I say to all of my friends - "adapt or die"

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Brian Karas
Jan 23, 2017
IPVM

There is a basic principle that needs to be considered, and that is every business' right to make the best decisions for their customers, and ultimately their shareholders.

Generally speaking, I think that most integrators are OK if a manufacturer wants to sell direct. People would not protest Anixter selling TRENDnet cameras direct to Amazon, because TRENDnet is very open about the fact that their products are available through various direct channels.

What integrators do not like is when a manufacturer or distributor says "we respect the channel and do not sell direct", and then turn around and sell direct to an end-user.

Integrators often choose to select and build partnerships with manufacturers and distributors based on how those entities tell them they operate now, and how they intend to operate in the future. Any many integrators are willing and able to adapt, so long as they have accurate information on which to base their future strategies.

 

 

 

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UM
Undisclosed Manufacturer #16
Jan 23, 2017

Completely agree Brian - do what you say and say what you do.  As a manufacturer, I too am frustrated when distribution uses the pricing support they get from us to usurp the integrators.  If I am aware, I will often take measures to prevent it.

JH
John Honovich
Jan 23, 2017
IPVM

#16, thanks for the feedback and the thoughtful comments. I agree with you that smart business people need to adapt and look out for their own best interests (whether it is a manufacturer, integrator or distributor).

However, do you think there is value in these groups partnering / aligning with each other? The 'adaptation' that is happening is a lot of 'every man for himself', with once open manufacturers becoming 'solution providers' (e.g., Axis), distributor selling more to end users, etc.

Is there really no sales benefit anymore for ethical and trustworthy partnerships amongst manufacturers, distributors and integrators? Thoughts?

UM
Undisclosed Manufacturer #16
Jan 23, 2017

I completely agree John - absolutely!  I can tell you my team and I are working very hard to earn (I stress the word earn) strong partnerships with key integrators & distribution, however we are also working hard to develop strong end user/A&E relationships to ensure we have a significant impact on our own destiny.  I do believe the right thing for our community is to continue to support the existing model - that is to say integrators sell to end users.  It has to be a two way street..... a true partnership.  They have the installation and maintenance expertise, and I am very happy when distribution sells direct, because it is the manufacturer that very often bears the frustration and customer blame.  

However as much as the integrator community is concerned about distribution/manufacturers selling direct, manufacturers are just as concerned that there is a clear lack of "price only" focus by the same community.  You cannot cry foul that your value is being negated, but do the same to the distribution/manufacturors.  

There is a place for all manufacturors, distributors & integrators.  Develop strong partnerships, create a take to market strategy that resonates with your clients, ensure your product has value and benefits that justify your pricing strategy and most of all, support each other.  Where you see these partnerships, you also typically see profitability.  Where you see "price-only" partnerships, you see instability and margin challenges.  I prefer the first option .... who is with me :)

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Laura Garest
Jan 23, 2017

I'm with you UM#16.

UI
Undisclosed Integrator #11
Jan 23, 2017

Contrary to the often-heard notion of "adapt or die", business is not a darwinian exercise. Partnerships, practices and industries have "rules of the road" that enable each party to have a say in the way the industry operates so as to have control over their destinies to the greatest extent possible.

If a company believes it has the right to slash and hack its way through an industry because it is mandated to do so by its shareholders, well, I dont want to be in business with that company. And neither should anyone else. 

"adapting" to an anarchy scenario may allow you to survive, but not likely to prosper. 

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John Honovich
Jan 23, 2017
IPVM

business is not a darwinian exercise.

I doubt Hikvision and Dahua agree with that.

I mean that as a serious point. The race to the bottom, which the Chinese manufacturers have driven, has created this vicious cycle where more manufacturers, struggling to keep their numbers up, compete with their heretofore partners. Take Axis. Their move to solution sales is a clear response to that.

End users win in the short term, surely, but, in the long term, it is draining profits and incentives to develop technology and support customers.

Whether or not one wants to be in that business, we are increasingly in that business. Agree/disagree?

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Undisclosed Integrator #11
Jan 23, 2017

Right, and for that reason Hikvision and Dahua are exactly the kinds of companies that I dont want to be in business with. 

Here is something that a lot of people in our forum probably wont want to hear: Hikvision could not be doing what they are doing without the support of thousands of integrators, industry distributors and industry manufacturers who use Hikvision as an OEM. I hear a lot of blame going around here - integrators blaming manufacturers, distributors, etc for not being loyal or ethical - but hey - we are responsible as well for this fragmenting industry.

We, as an industry, and by "we" I mean integrators, manufacturers, Consultants and distributors, have the power to determine our own destinies within the marketplace, and, tragically, we are deciding that we want allow two companies owned by the Chinese politburo to dictate terms, because, it appears, we don't have enough confidence in the value we add and the products and services we offer, and bid our own value down by abandoning each other and creating a condition of price-driven anarchy in which we are in a constant state of dispruption and adaptation. There is no good ending to that. That will spell the end of the integration business as we know it, and leave all but the largest customers having to cope with simple plug-n-play systems. 

When I hear people in our industry cheerfully announcing their willingness to "adapt" to this, my head wants to explode. 

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UI
Undisclosed Integrator #17
Jan 23, 2017

As a regional integrator, I do not like the move, but as a business person, I understand it and know we are powerless to stop it.  A precursor to this was when a manufacturer's "national accounts" division's negotiated fixed discounts that an integrator had to live with, which in our experience were steep and forced us to re-allocate how we priced our services on such sales.  Today, all manufacturers are moving away from the distribution side of the business for valid reasons.  This is starting to happen even on the fire side of our business.  As for Anixter going direct to the end user, they have the national reach and can more easily pass on the pricing that Amazon negotiated. I don't know the deal's details, but doubt Anixter is charged with keeping their systems maintained and running.  Amazon does those things on their own after the installer's warranty runs out.  We have had success with Amazon, but that side of our business is managed much differently.  A typical integrator's model would struggle to meet their demands - that is why we separated it out.  You are not missing what you think you are in this deal.  As integrators we are powerless to stop the evolution to these changes.  What we must do is adapt our business.

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John Williams
Jan 23, 2017

Amen

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John Williams
Jan 23, 2017

The reason Alibaba did so well is everything, in most of the world, is direct and expected.  

When I told customers, in the Far East, I have a manufacturers rep, they made it clear they didn't want to see them. It only meant one thing - somebodies getting part of my profit!

The internet will peal the layers back. Stick with intelligence or culturally based products.

UI
Undisclosed Integrator #12
Jan 23, 2017

| When I hear people in our industry cheerfully announcing their willingness to "adapt" to this, my head wants to explode.

Ditto.... my head also wants to explode when I hear someone say "we must adapt"!

We chart our own course, make our own decisions and, we choose not to adapt doing business with manufacturers and distributers who have your back. Not those who would stab you in it!

Integrators can choose; Are we to be known as a Leader or a Follower?

Followers choose to be like Lemmings who are widely known for their tendency to run en masse off of cliffs to their deaths. Integrators who's behavior of adapting, mimics others and mindlessly follow the crowd, despite the obvious consequences, will all succumb to the same fate!

Lemmings shall continue to pile up in the Race to the Bottom, along with manufacturers and distributors who cut their own throats over short term thinking.

Some "think" loyalty is dead. It isn't! 

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John Williams
Jan 23, 2017

My definition of Loyalty: "A word people in power use to manipulate people who aren't in power". Of course, I've hired folks not work for them until recently.

I now believe there is such a thing a Loyalty and there's a tremendous efficiency in that dynamic. I worked for the right person!

But be careful, loyal isn't always comfortable and the other side of the equation should be aware and reacting to the market, not riding it down. If you were loyal to Polaroid or Kodak, it's a long road to nowhere.

UI
Undisclosed Integrator #17
Jan 23, 2017

Adaptation is not succumbing to pressure or mindlessly following the crowd.  Adaptation should include forward thinking, innovation, and a willingness to change. 

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UI
Undisclosed Integrator #11
Jan 23, 2017

Adapting by definition is succumbing to external forces in order to survive, no? 

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Undisclosed Integrator #12
Jan 23, 2017

If you are assuming we are only trying survive, maybe! There is a BIG difference however between mere survival and profitable business growth!

When those who have been in this industry for a long time think that this its "just the way it is or the way it has to be" they are adapting to what they perceive to be the norm and thinking there is nothing they can do about it! We (especially the collective we) have more power and control than you think.

Definition or not. NO, I don't believe that we have to succumbing to external forces in order to "just" survive. 

JB
Jason Brown
Jan 23, 2017

It's simple, either don't take labor-only projects OR have an agreed-upon markup like an interior designer or general contractor. If you would normally make 20% profit then maybe split it with them if you don't have to order, warehouse, or warranty the hardware. And bill them for every single second you spend on the project.

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UI
Undisclosed Integrator #12
Jan 24, 2017

Integrators who take these so called "labor only" projects are in fact, facilitating and supporting the practice of direct end-user sales by manufacturers and distributors. As they make their expertise available for hire, they have lost the foundation of why they exist and why they are known as an Integrators, and not Installers.

Thank God that ethical manufacturers still exist that will not, under any circumstances, sell direct to end users. While these manufacturers continue to promote their brand among end-users and target industries, they always engage a Certified Integrator to quote the technology, infrastructure, installation labor and sell the value in their expertise!

Integrators should refuse to support this direct to end-user sales, thus making it impossible to hire professional video surveillance expertise for installation, commissioning, and training.

Under the true letter of the law, wouldn't some of these distributors and manufacturers be violating various state licensing requirements, by selling security technology direct without the proper security license required? Most states do not simply require technicians and installers to be licensed, but the sales staff also, correct?

Do you also facilitate and support this violation of the law, when legitimate Integrators must always comply?

Unfortunately, many Integrators are exactly like the manufactures and distributers who engage in this cut-throat practice...

...Their greed is more powerful than their character or standards!

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UI
Undisclosed Integrator #14
Jan 25, 2017

I've always thought that cutting the "middle-man" (e.g. integrator) from the trade, hire an expert for the company who can design, commission and maintain the system with sub-contractors to physical works would be much more convenient and cost effective for any company. If manufacturers give in for this logical point of view of end-users, integrators are gone.

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Michael Fusco
Jan 25, 2017

"hire an expert for the company who can design, commission and maintain the system"

 

That's the definition of the integrator. The integrator provides the depth of knowledge, experience, installation and support capability to INTEGRATE complex multi-vendor systems into a singular solution. The integrator isn't going anywhere. Manufacturers and distributors who meddle into the integrator's realm only serve to disrupt the industry to no good result, and they should stop doing it.