Lenovo looks to channel growth in 2014

Vendor announces raft of additions to One Channel programme and sharpens focus on server, storage and SMB growth

Lenovo has rejigged its One Channel partner programme as it looks to reward successful partners and boost SMB business across EMEA.

The Chinese vendor, which has admitted it is in acquisition talks with an unnamed third party, rumoured to be over IBM's low-endserver business, claimed it had listened to partner feedback before making the changes, and will focus further in increasing rewards and cash flows for its channel, particularly around its expanding server and storage portfolios.

In addition, the programme - which is formed around a 'channel first' strategy - will include two initiatives to simplify the measurement of channel revenues and provide a quotation tool to authorised Lenovo partners' sales floors.

Gianfranco Lanci, senior vice president of Lenovo Group, and EMEA president, said: "The channel has played a critical role in our remarkable results. Our partners have helped us become the number one PC company in the world and the second largest PC vendor in EMEA, where channel sales represent 95 per cent of our total business.

“We are at an exciting time as a business – we are expanding our portfolio of products in line with our PC+ ambitions and are creating new opportunities for the channel to work with us and grow their business. By continually investing in our relationship and programmes with the channel, we believe we will achieve our mid-term objective of also leading the PC+ space."

Additions in full:

• The full integration of Lenovo’s storage business will consolidate two programmes into one. The former Iomega ioclub portal and programmes will be full transitioned into the Lenovo Partner Portal and the One Channel rewards portal, and Lenovo’s tier twio Premium partners will earn rewards for storage.
• All lines of business including servers and storage will have no earning gates or minimum thresholds and pay rewards from the first sales. Targets will be to drive more growth in the SMB sector which will be rewarded with higher incremental rebates.
• Lenovo's new partner portal launched in October 2013 will offer dashboard improvements and greater visibility of the earned rewards.
• Lenovo is also investing further in its Authorised Distributors by increasing the extended credit terms by 50 per cent, to help fuel the continued channel expansion and revenue growth.
• It is also pledging to simplify programme processes such as a new e-invoicing process (where country tax laws allow), resulting in faster processing of the rebate payments, it claims. Partners will have the cash in their banks within 4 weeks of the close of the quarter.
• Server focus – Lenovo is further investing into the server and storage categories to drive growth in these markets in EMEA. Rewards are paid from the first sales with no targets or thresholds and are driven by partner business plans. Lenovo is putting those funds entirely behind partner’s own business development ideas, and the partner simply needs to agree that plan with Lenovo to unlock the incremental rebates.
• It is also providing simple access to Lenovo’s server and storage universe without the need to revalidate technical competences and no stringent technical certification or training requirements.

And there is more to come, with a new price quotation tool, based on Salesforce.com technology due to launch in April. According to Lenovo, the tool will boast a two-hour turnaround on products selected from the TopSeller product set and will give VARs visibility of inventories at their preferred distributor.

Neil Berville, executive director of Lenovo Channels EMEA, said: “We have a ‘channel first’ strategy in EMEA that is paying off. In 2013 we increased our channel revenues by €1.5bn and, unlike the majority of the market, we expanded our reseller base by 16 per cent while the overall channel has reduced by nine per cent according to [analyst firm] Context.

“This year we are re-emphasing our focus on the SMB market, by boosting rewards & cashflow for the partners and also adding new incremental rewards for servers & storage to encourage partners to jump in early with a new emerging player," he added.