SnapAV, a leading distributor and product developer for the smart-home installation channel, has acquired Allnet Distributing, a revered wholesale distributor with four brick-and-mortar locations in the Midwest.
Allnet provides the first “personal” presence for SnapAV, which established itself 12 years ago as the greatest e-commerce machine and the most logistically adept mover of boxes the channel had ever seen.
It would take years for other distributors and manufacturers to even approach the back-end systems that made SnapAV so efficient … and so successful. By then the Charlotte, N.C., company had moved beyond its position as a useful importer of commodity products, establishing itself as an inventive developer of high-tech systems.
These new technologies would demand more engagement with dealers – training, technical support, and a little coddling for some of the newer categories like intelligent video surveillance and remote systems management.
Despite SnapAV’s stellar online training and documentation, however, the company began to wonder what would happen if it forged more personal ties with dealers, most of whom could patronize SnapAV for a lifetime without ever talking to an actual person.
Local Presence Could Boost OvrC
The idea gained steam as the company rolled out more intelligent products that could interconnect through a single platform called OvrC, a cloud-based service for remote systems monitoring and management. First came OvrC-enabled power-management products (WattBox brand), followed by networking gear (Araknis), surveillance systems (Luma and Visualint), and multiroom audio (Autonomic).
Via OvrC, dealers can remotely monitor and troubleshoot virtually any device on a home network, but they can glean further insights and provide more in-depth support for native OvrC devices – currently only available from SnapAV, but potentially other manufacturers who incorporate OvrC technology into their products.
As the ecosystem builds, SnapAV sees potential in a more hands-on relationship with dealers … such as Allnet can provide in the Midwest.
“SnapAV does a great job with distance learning,” says Allnet founder and president Wally Whinna, who operates out of the company’s Chicago-area headquarters. “But we’re big on merchandising. We like to bring in dealers, show them how things work together.”
Admittedly, he says, Allnet could do better at showcasing complete smart-home ecosystems, and he thinks SnapAV could be just the partner to make such a showcase happen.
He hopes to “work with SnapAV to do more interactive things, to tie everything into OvrC in order to lead dealers into that opportunity.”
He believes once dealers “migrate to OvrC,” they’ll be more amenable to smart-home categories that eluded them in the past. For example, Whinna explains, “We should get more power and surveillance business. It’s an ecosystem that will continue to grow.”
He adds, “We’re going to be able to hold their hands in some of this, show them how to decrease truck rolls with OvrC. It adds a whole different dimension to their business.”
A Brief History of Allnet
Wally Whinna is a bit of a celebrity in the home-technology distribution business, known for caring about vendors and dealers above all else. Allnet promises to “work with you [dealeres] in the field; one on one with clients; to assist in closing sales and design the perfect solution for any application.”
More than 30 years ago, he established Tandem Marketing, a manufacturers' rep firm that continues to this day, and then Allnet as a warehousing arm and full-service distribution company.
Whinna was a co-founder of AVAD in 1997, which sold to Ingram Micro in 2005 for about $200 million. Five years later, after his non-compete expired, Whinna re-opened Allnet, and then co-founded Catalyst AV with 10 other regional distributors.
Today, Allnet is as big as it was pre-AVAD, Whinna says.
He, along with Allnet business partner Bill Zidek, will continue to run the distribution company under SnapAV.
But First … Allnet as a Warehouse
In an interview with CE Pro, SnapAV president Adam Levy says he imagines plenty of possibilities enabled by a local presence; however, right now the company is most focused on getting Midwest customers the same fast service as the rest of the country.
Besides its own Charlotte, N.C., hub, SnapAV has warehouses in Dallas and Fresno, Calif. In most of the country, he says, SnapAV can deliver products in one day, maybe two. In the Midwest, however, it can take two or three days for products to arrive.
“The nearest-term opportunity,” he says, “is simply to serve dealers in the Midwest much more effectively than we have.”
Allnet has branches in Elk Grove, IL; Troy, Mich.; Carmel, Ind.; and Edina, Minn.
Dealers will have plenty of choices for ordering and receiving SnapAV products, according to Whinna. They can grab products right off the Allnet shelves, pick them up 24/7 at will call, order through SnapAV as usual, or get the goods by courier. In addition, the Allnet locations will have kiosks on site for placing orders, printing return authorizations, and otherwise helping themselves to SnapAV service without having to talk to anyone.
“We can help facilitate all of that,” Whinna says. “We can provide a new higher level of service, even for SnapAV.”
But Really … Oh, the Possibilities!
Although Levy doesn’t want to get ahead of himself, he is clearly intrigued by the idea of a brick-and-mortar presence. Of course, the number-crunchers at SnapAV don’t do anything based on intrigue. Levy suggests that the data made them do it.
The warehouses in Dallas and Fresno were set up expressly as that: warehouses. Inventory would be stacked high on shelves, picked accurately by efficient workers, and FedExed fast to dealers in the region.
There would be no friendly face to welcome customers and serve them hot coffee as they waited for their orders.
And still: The dealers came.
So SnapAV quietly opened up a pick-up center this year in Plainview, N.Y., says Levy, as a test to see what would happen if they stocked a few products and provided a little local service in a concentrated area of very important dealers.
Evidently the test went well enough for SnapAV to go whole-hog with a full slate of products offered by a full-service distributor. SnapAV products would be sold alongside all the other Allnet offerings – both competitive and complementary – allowing Snap to be part of a complete residential ecosystem from TVs to alarm systems to high-end speakers and DIY devices.
“We’ve always had holes in our lineup,” Levy says. “What if there was a facility that had everything dealers need? How would that impact things?”
What about Other Allnet Vendors?
Certainly, some existing Allnet vendors won’t be terribly thrilled with the acquisition.
Among CE Pro 100 dealers, SnapAV is a top-three brand in network cable, structured wiring, TV mounts, speaker cables, power conditioners, outdoor speakers, video switchers, HDMI cables, racks, surveillance cameras, networking products, and soundbars (among others).
These are all products that lend themselves particularly well to local distribution, where dealers often purchase last-minute for jobs they need to finish.
But it’s the OvrC-enabled products that will likely have the biggest impact on existing Allnet vendors. If Allnet is successful in leading dealers to the platform, then SnapAV could snatch business from suppliers in competing categories, namely power management, networking, and surveillance … for starters.
Certainly Domotz will be impacted, as it competes directly with OvrC in remote managed systems. While Domotz provides richer analytics than SnapAV’s solution, “It’s hard to compete with OvrC,” Whinna says.
Also, SnapAV no longer charges recurring fees for OvrC, whereas Domotz charges a few dollars per month. When SnapAV dropped its monthly OvrC fees last year, the company reasoned it would be better off hooking dealers with the (free) platform and selling more OvrC-enabled hardware. Allnet is a good place to sell more hardware.
Both SnapAV and Allnet are sensitive to potential concerns from competing brands, but as Levy says, “Wally has impeccable vendor-manaagement skills.”
For Whinna's part, “We hope to retain all these brands. We're picking up 40 percent more dealers.”
He says his conversations with competing vendors have gone well so far, as he positions SnapAV as the “house brand” of products. Virtually all of the major home-tech distributors are launching their own brands of mostly-commodity products these days. Even Catalyst AV, a group of regional distributors of which Allnet is a member, has its own brand of wire, speakers and mounts.
Certainly, it's nothing new for a manufacturer to own a distributor. Honeywell acquired the giant ADI Global Distributing in 1999, where Honeywell security products are sold alongside its competitors' (Honeywell is now spinning off the distribution group).
Make no mistake, SnapAV is not on a mission to buy up distributors or to establish a national distribution chain.
Levy says, “Right now, we have a few locations in the Midwest where we'll conduct training, ship products and generally serve an important set of dealers we haven't been able to serve as well as we'd like.”
SnapAV itself was acquired in 2017 by the private equity firm Hellman & Friedman.