12 August 2014

CRN says "Cloud Distribution takes itself by surprise with sales hike"

Cloud Distribution claims it is on course to turn over £15m in 2014 as its newer vendor signings begin to make their mark on its top line.

The distributor, which was founded in 2009, says it is poised to shatter the £12m in revenue it clawed in last year despite seeing largest vendor Meraki moving into broadline distribution following its acquisition by Cisco in 2012.

Cloud still has access to Meraki but director Adam Davison said the wireless LAN vendor no longer represents the lion's share of its sales.

"Meraki wasn't our biggest vendor last month," Davison revealed.

"All the other [Cisco] distributors are now in play on Meraki but I think it's fair to say the partners still want to buy Meraki from us. The subtlety and challenge with that is some of these partners rely on Cisco products and all sorts of things like rebates and MDF come into play and sometimes the margin is low and we have to gracefully say ‘no thank you'. But because we still have a great relationship with those partners they are taking on board those other products in our portfolio."

Due to the uncertainty surrounding Meraki, Cloud set itself a cautious 2014 revenue goal of £12m but is on course to hit its ‘stretch' target of £15m as new vendor signings begin to make an impact, Davison said.

Cloud counts A10 Networks, Exinda, Aerohive Talon and WatchDox among its more established vendors but Davison claimed its real niche is seeding the market for new vendors. These include Cloud4Wi, Lacoon and Peplink.

"We are now starting to see pockets of really nice orders coming in for those vendors and it's going to be a very exciting second half of this year and early part of next year," Davison said.

"Of all the distributors that focus on bringing new vendors to market, I think we've done the best job of creating a very clear and simple set of tools that help resellers create end user demand and launch the vendors to market," he said.


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