Many in the custom electronics industry were surprised last week with the announcement from SnapAV that it plans to acquire Access Networks. Among the first questions asked by some was “why?” especially since SnapAV already has its own Araknis and Pakedge brands in the home networking space.
SnapAV CEO John Heyman shed some more light on the Access Networks acquisition in an interview with CE Pro, as well as addressing some of the recent upheaval in the distribution side of the business.
CE Pro: What attracted SnapAV to Access Networks in particular?
John Heyman: Over the past year, the way we work and live has changed dramatically. This has created new opportunities for the products, technologies and services that keep us all connected. Access Networks and their team of networking experts are uniquely positioned to deliver end-to-end solutions that start with robust system designs and continue with reliable, high-performance network deployments and ongoing support that meets the demands of today’s projects. Access Networks combined with SnapAV’s existing networking lineup of Araknis, Pakedge and our OvrC remote management platform, empower our Partners to tackle jobs of any size, scale or complexity with confidence.
CE Pro: Tell us how you plan to niche Access Networks’ solutions alongside your existing Araknis and Pakedge solutions?
Heyman: We think of our product offering as a curated portfolio to scale to any size project across multiple markets and applications. We recognize there is some overlap in Araknis and Pakedge today that we are working to more clearly differentiate through new product development cycles that are in process. We will continue to heavily invest in our proprietary brands Araknis, Pakedge and OvrC.
Access Networks occupies a position for more-demanding environments where Partners benefit from network engineers designing, configuring, and supporting the system post-delivery. These projects include high density environments, those that require firewall protection and those that are exceptionally large.
CE Pro: What is your reaction to those in the market who are describing SnapAV as the “Amazon of the custom electronics industry” both in a good way and a negative way? What are the elements of that analogy that you are proud of, and how is SnapAV different from the Amazon analogy?
Heyman: First of all, from an operations standpoint – we welcome the Amazon analogy! Their eCommerce platform and fulfillment are best-in-class. With a net promoter score in the 60s, they are clearly doing something right. That being said, we differ significantly in our go-to-market. At SnapAV, we are committed to serving professionals, period.
That means we must ensure our Partners have access to products and services they can make a profit on, in-house call centers including technical support and many other benefits. And that’s just our business platform… Our products and services platform includes the curated 1P and 3P portfolio of products that partners buy from us – the one stop shop for pros – as well as software like Control4’s OS3, OvrC remote management and so much more. So, while the Amazon comparison is fair (and positive) in some ways, we very much differ in others.
SnapAV Is Bullish on Distribution Business
CE Pro: A long list of local and regional distributors have gone out of business over the past few years. Why is the distribution business becoming so difficult and what is SnapAV doing differently so its Pro Stores can thrive?
Heyman: SnapAV launched its entry into Local Distribution in a very nontraditional manner. We were already a market leader servicing our partners with our popular proprietary brands and a few third-party vendors sold through our ecommerce platform. We understood that to drive ongoing Partner support, we needed to be closer to them, providing services in-market with the local knowledge, relationships, and deeper partnerships with key third-party vendors.
We’ve acquired what we feel are the very best local distributors that had the right leadership, strong cultural alignment and dominant market positions to implement that strategy. From there we have organically expanded into underserved markets with a strong brand assortment and highest levels of customer service. We now have a national footprint with 27 locations and counting.
Our differentiated go-to-market and scale enables us to service our Partners with an omnichannel platform where they can access all the best brands in their preferred manner, thru local will call, same day delivery, 24-hour local access and from our award-winning ecommerce platforms. The best brands, ease of transacting business, highest levels of customer and technical support are the cornerstones of our success.
CE Pro: What is your outlook for the distribution business in general?
Heyman: We are bullish on distribution and continue to invest in both our ecommerce platforms and local branches. We call our integrators “Partners” for a reason – it’s a two-way street, and our goal is to provide a place where they can go to aggregate their purchases and decrease back-office demands so they can focus on expanding their business and servicing their clients. They need a resource where they have efficient access to the best brands backed by expert support.
For manufacturers/vendors, the market is very fragmented. Therefore, distribution is the most efficient and cost-effective way for them to reach an expanding and diverse market with 20,000+ dealers. The most important thing for a vendor is to choose the distribution partner that can collaborate with them to effectively deliver their brand message, along with the scale and market-reach to effectively get products into customers’ hands.