Richmond Hill, Ont. – About 100 channel players in the consumer electronics space and the IT market gathered at the Sheraton Parkway hotel recently to listen to a pitch from VisionQuest.
Jimmy Davlouros, the North American GM of the company, said brands come and go in business but in the end it is all about the money.
After just nine weeks in business in Canada, VisionQuest is offering a whopping 20-point margins on its displays in a market where channel players get five-points and under.
“There has been 65 per cent erosion in the LCD flat panel market in the past 36 months,” he said citing a research report from DataQuest.
“We used to be getting $500 for 17-inch monitors and today you have to sell three to four times more just to make the same revenue as before. We have to change that and look at some new opportunities,” Davlouros said.
There is an opportunity, he believes, in the widescreen LCD display. Again citing the DataQuest report, there will be six years of double-digit growth in this area.
With that VisionQuest released two series of displays. The Picasso and the Rembrandt are cross-over high definition LCD displays for business or the home markets. The sizes range from 20-inches all the way up to 46-inches.
Kevin Baggs, vice-president and general manager for Synnex Canada’s consumer electronics division, acknowledges that the 20-point margin proposal is striking for IT resellers, but it is standard in the CE space.
Baggs believes that VisionQuest is positioned well to partner with both IT and CE resellers. Synnex Canada is currently VisionQuest’s only distribution partner in Canada.
“What is happening is a cross over, not a convergence,” Baggs said. Both IT and CE resellers can bolster their revenue by selling more Vista-based media centre PC solutions because there is a separation of knowledge.
CE resellers do not understand WiFi and Internet Protocols, he said, while the IT resellers are not as knowledgeable as the CE dealers on the audio-visual side of the solution.
VisionQuest wants to be a value play more so than a price play in the market, Davlouros said.
About 56 per cent of the flat panel sales today come from four vendors: Sony, Samsung, Sharp and Philips, while the remainder come from 44 other vendors.
The average selling price for the top four vendors is $1,000, Davlouros said. The average selling price for the bottom 44 vendors in the LCD market is $750.
“The lion’s share of the market is not dominated by price. Price does not drive share, value add does,” he added.
Davlouros believes that independent CE and IT channels are converging and will make up 16 per cent of the market by the end of the year.
“Convergence is a fact and there is strength in numbers. Stick together as a business, not because of cheap prices, but for service and support,” he advised the audience.
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