Dicker Data 32 years and going strong

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This article appeared in the April 2010 issue of CRN magazine.

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Dicker Data 32 years and going strong
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Close and personal

Yet there are special considerations in selling IT, of which Dicker is acutely aware. Dicker illustrated a special facet of the computer industry by offering an episode from his own business experience.

"Back in the 1990s we tried to build a retail chain on a franchise basis and eventually we gave it up because it was very hard to make enough profit to fund the marketing," he says.

What the experience taught Dicker was that the smaller operator - who doesn't need the high traffic required by large operations such as Harvey Norman and therefore can avoid costly saturation marketing - has a distinct business advantage derived through more intimate customer relations.

Dicker says it came as a surprise to him that the smaller guy can make it against the bigger guy because it's so much easier for a small dealer to maintain real relationships with the people who walk through the front door.

"The thing is that the products on sale are so much more technical than a washing machine or a car and that technical requirement is always going to leave a place for the small guy with a low overhead and a good skill base to develop a relationship with his customers."

Dicker says the small operator has the ability to develop a loyal customer base who will return for upgrades and peripherals and rely on the operator's expertise to guide them through the maze of complexity that comes with using computers and other equipment.

"Harvey Norman and those kind of operators are never going to compete with that because they don't have the set-up to make it work," Dicker says.

"They can't have the same level of expertise and personal contact and can't be as good at it as the smaller guy who has years of experience with the product."

Yet the large franchise operator and the small shopfront business, curiously, co-exist.

"There's an equilibrium there because neither of them are going to drive each other out of business," Dicker says.
Each has their place and each will find customers with different needs. Some will be looking for the cheapest product available and other customers will look for someone they can trust with their long-term IT requirements.

Turning attention to the relationships that has made Dicker Data the success that it is, Dicker says he rates highly his industry partnership with HP. A look at his vendor list shows he likes to deal with the big names.

"It's a volume business and as a distributor you've got to go with the big guys," Dicker says. "We strongly rely on HP products and I think they're miles ahead."

Dicker Data has since announced that it is preparing to list on the Australian Stock Exchange in a move intended to strengthen the company.

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