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Gates/Arrow Goes Where Few Have Gone Before<@VM>Merisel and Compaq Bolster Partnership<@VM>Westcon and Force 3 Forge a Deal

Gates/Arrow Distributing, a division of Arrow Electronics Inc. of Melville, N.Y., has been awarded a General Services Administration schedule to help resellers sell equipment to government customers.

Few distributors hold GSA schedules out of fear it gives the appearance they are doing business directly with end users, a practice distributors eschew to avoid competing with their customers.

But Tim Collins, Gates/Arrow's vice president of sales, said the company is holding the schedule strictly on behalf of resellers to bolster sales for manufacturers. Gates will not sell products directly to end users, said Collins, who noted that Gates began working on its plan to hold a schedule in early 1998.

The situation works like this: Because many smaller resellers do not hold GSA schedules, they cannot sell to the government.

"There are a plethora of government agencies all over the country that would like to have a relationship with local resellers," said Collins, who expects the plan will give Gates a way to distinguish itself from a pack of distributor rivals. By holding a GSA schedule on behalf of resellers, Gates will give them access to government customers while it handles the headache of keeping the schedule up to date and of warehousing product and shipping orders, Collins said.

"If the government customer chooses to use this, resellers think it assists them in their business, and manufacturers see incremental revenue, then I believe it will have been a success," Collins said. Gates/Arrow is based in Greenville, S.C.

Pinacor Inc. of Tempe, Ariz., the distribution arm of MicroAge Inc., is one of the few other distributors interested in holding a GSA schedule on behalf of resellers. The company plans to submit its schedule proposal to the GSA in July.
Merisel Inc. of El Segundo, Calif., has formed a partnership with computer giant Compaq Computer Corp. to offer authorized resellers and systems integrators special prices and services through Merisel's Public Sector Solutions program.

Under the partnership, resellers and integrators will get discounts on Compaq systems, access to a Merisel sales specialist dedicated to helping resellers before and after the sale, and special prices for resellers that support direct manufacturers. Minority-owned businesses also will receive support developing bid responses.

The move is aimed at giving resellers complete system solutions to deliver to their government customers.

"We're working together to offer government resellers the Compaq products, services and support needed to win federal market opportunities," said Gary Newgaard, vice president of Compaq Federal.
Networking distributor Westcon Inc. of Tarrytown, N.Y., has formed a high-level partnership with Force 3 Inc. of Crofton, Md., to help Force 3 better serve its government customers.

Under the partnership, Force 3 will receive consulting services from Westcon's executive management, a seat on Westcon's advisory council, enhanced marketing services, special training, global delivery services, price protection and other benefits.

Force 3, a government reseller, has grown its revenue from $24 million in 1995 to $83 million in 1998. Westcon is a global distributor of networking products.

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