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Renaissance strikes back

01 Aug 10

On Friday, June 25th The Channel ran an online article based on the feedback from a number of well-placed industry sources that highlighted some troubling trends within the Auckland-based distributor. Since then The Channel website has exclusively revealed that Renaissance is preparing to launch its own in-house brand of peripherals and hardware devices under the new brand name, Yoobee. We also revealed that the company would re-brand its MagnumMac division with the new Yoobee name and logo.

GO Is it true that you’ve recently lost four key brands to other distributors?

RW Absolutely not. The only one that we lost, and we knew it well up front, was 3Com because HP bought them out. We have not lost any distributorships and we have gained five in the last month.

GO What would you say to vendors who have told us they’ve become increasingly frustrated with the amount of recent changes at Renaissance?

RW I think there are a number of people who used to manage vendor relationships and they have those points of view. But I don’t think that vendors have that point of view and we haven’t lost any accounts.

GO Will the recent changes and departures of key personnel affect your pipeline of sales, quotes and tenders?

RW I really don’t think so. We have a very strong pipeline. My personal belief is this company has failed to forecast its earnings now for six half yearly reports in a row. And when I first arrived here at the beginning of the year, the lack of visibility of a pipeline and the lack of an understanding of what’s in the pipeline was absolutely amazing to me. I don’t know how you could have forecasted this business. We really had 13 businesses with 13 sets of spreadsheets and notes in the draw.
For the first time ever we have what I’d say is beautiful visibility of what’s in our pipeline, and I have to say I’ve never seen a pipeline stronger. Is that because I couldn’t see the pipeline before? I don’t know. But I feel very comfortable forecasting the business going forward now. I did not feel like that three months ago.

GO How will openly selling to the end-user affect current channel relationships?

RW My personal belief is that there isn’t a manufacturer or distributor out there that doesn’t have some kind of channel conflict. I can go into the Apple store in Sydney and Apple will give me a discount because that’s the lowest price that JB Hi-Fi is currently selling an iPod for. That’s channel conflict and that happens. If you’re in the business of manufacturing or distributing a product you’re going to, hopefully, manage that channel conflict well. I believe there’s no doubt that, in the 25 years of this company, we’ve always had a direct business. We’ve always had channel conflict. We had a Red business selling to the education channel and selling to resellers, so I don’t think we’ve introduced anything new.
If anything we’ve split it apart. We have all of our direct business units down in Quay Street and all of our channel sales team sitting here in Onehunga.
We do believe that some clients may not have been served well by the channel because we just didn’t have resellers in a certain industry vertical. We haven’t seen that direct business go out and directly compete head-to-head with our channel. I just don’t see it happening.

GO So you don’t think you’ll be alienating your existing partners?

RW I don’t think we’re alienating partners. If anything we’ve had manufacturers and vendors that we’ve distributed for come to us and say that it’s great to hear there’s an array of ways their products can be sold to market.

GO Can your new business model survive in today’s market?

RW Absolutely. I think that because we are a New Zealand business and publicly listed, we’re a lot more nimble than something that would be bigger and potentially managed from afar.
I’ve said in the AGM and in all the public documents that for a company to survive today it has to own its own brand, some of its own IP and own some relationship with the end-user. If you don’t pursue bits of each of those strategies, I think the world of disintermediation kicks in. It’s getting tougher and tougher to be a middleman in this world.

GO What will be the single biggest change to Renaissance in the next six months?

RW The biggest change would be the introduction of a new brand, our brand. The brand will emerge through a range of new services. We’re not going to rebrand existing services but it’s a brand that could fi nd its way on to our retailer offering, it could fi nd its way into a wide range of our own branded peripherals and hardware devices that we’ll manufacturer right here in this plant. You’ll fi nd this new brand not too dissimilar to Virgin across a whole range of products, services and offerings.
I think it’s a lot easier to have a single brand, and bring that to market and build brand awareness, than to support what we’ve historically supported, which is a myriad of brands. We’ll be a branded house, not a house of brands.

*Editor’s note: Since conducing this interview The Channel exclusively revealed that the new Renaissance brand was Yoobee.

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