Hyperchannel Distribution has launched an e-commerce offensive to push resellers into cyberspace - a move that will open the floodgates for Web-only companies selling at cost, as experienced in the US.
The company followed the launch of its online superstore on 21 April, with its reseller e-commerce programme, Hyporium. It claims that for #995 per year, a re-seller can be online in three hours and trading using its catalogue templates.
Nick Kandola, managing director of Hyperchannel, said: 'We want to make it easier, cheaper and faster to establish a reseller's e-commerce site. Collapsing the supply chain will benefit resellers, distributors and users. It will mean increased economy of scale and efficiency.'
He added that he believed the automation of the processes would increase gross margin by 50 per cent, driving costs down and freeing resellers to focus on services.
Kandola conceded that the product would open the door to a similar situation to the US with resellers selling PCs at cost. 'There would not be anything to stop a reseller doing that - we are offering the tools, it's up to the reseller what it wants to do with that,' he said.
He added that he only wanted to involve vendors that were committed to the channel and would not deal with direct vendors such as Dell.
Hyporium allows a reseller to carry products from Hyperchannel and up to four other distributors. It is already in talks with other distributors to form strategic partnerships in the UK and is also looking to acquire distributors in Europe to expand the programme.
The site would be fully branded as belonging to the resellers and hosted by an independent ISP. Kandola hoped the initiative will double the reseller figure to 600 by the end of the year.
Graham Taylor, analyst at Inteco, said: 'Flawless execution is the key to e-commerce. It needs to be delivered smoothly and effectively to the user. It's a very aggressive space.'
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