Wireless+: Taking Stock of Wireless Inventory

In contrast to years past, the burden of stocking inventory, such as wireless phones, is largely a moot point for today’s wireless dealers. This is a relief to many would-be and existing dealers as it reduces the pressures of upfront cash outlays and the requirement to develop tools and train staff to properly manage inventory.

In the past, a mobile operator like AT&T Inc. would require a certain type of partner, which it termed “non-co-sell” partners, to carry inventory. Today that requirement has been rescinded. To clarify, nonco- sell partners are those agents that target SMBs. A co-sell model requires agents to commit to a higher number of lines and target enterprise customers that are likely to end up on the highly regulated AT&T “named account list” that the direct teams own.

Co-sell partners typically are designated as such if they sell solutions the carrier does not stock. These can be devices from Symbol Technologies Inc. (now Motorola Inc.), which are rugged mobile and wearable computers with embedded wireless functionality. Other types of equipment might include 3G routers from manufacturers like Top Global USA Inc., JBM Electronics Co., or Junxion Inc., or embedded notebooks from Hewlett-Packard, Dell Inc. or Panasonic Corp.

A channel partner can go through master dealers to acquire most equipment that is not carried by the carrier. Value-added distributor Ingram Micro Inc., for example, carries solutions from vendors such as Cisco Systems Inc., Symbol Technologies, Digi International, Linksys, Sony Corp., HP and Lenovo. It carries a limited inventory of wireless devices and wireless modems that are carrier-stocked since there are no requirements to do so, and it is much easier to redeem carrier-subsidized promos, credits and rebates on equipment at the time of order. Ingram Micro will procure carrier-stocked items for special cases, including channel partners with customers that have standardized on a certain type of equipment that is reaching end of life with the carrier. In these cases, a master dealer or master agent can look at procuring some devices or modems directly with the manufacturer. In most scenarios, however, manufacturers of both dumb and smart devices do not sell equipment outside of the carrier relationship.

When working with CDMA carriers like Sprint Nextel and Verizon Wireless, it virtually is impossible to provision an unlocked device on the network. All devices have to be “flashed” for the specific network from the manufacturer. Furthermore, the U.S. wireless carriers are very stringent about preventing uncertified devices from being activated on their networks.

When working with GSM carriers like T-Mobile and most mobile operators globally, the ability to activate unlocked equipment is much simpler because of the subscriber identity module (SIM) card. This is a small electronic card inserted into a mobile device that provides a unique ID correlating to the subscriber’s billing details and network permissions. Most overseas operators do not require manufacturers to provision the device specific to the network as the SIM card can be placed into a phone of the user’s choice and charged up using a post-paid model. In Europe and Asia, consumers have the freedom to replace the SIM card in any device of their choice, activating the account on a carrier network of their choice. U.S. operators like T-Mobile and AT&T, however, prevent uncertified devices from being activated on their networks although there are hackers who have successfully unlocked the devices such as the recent press around the iPhone being “liberated” from the AT&T network.

If channel partners would like to make extra margin on selling equipment without the headaches of carrying inventory, they can seek out master dealers that carry noncarrier stock as they will typically make a margin on the sale of the equipment as well as a commission on the activation.

Natasha Royer Coons is the founder and managing director of TeraNova Consulting Group, a consulting firm providing fully managed mobility solutions and wireless WAN products, services and expertise to channel partners nationwide. She brings a decade of experience as a former solutions consultant and SC manager advising partners on wireless and wireline products for Sprint Nextel Corp. Reach her at natasha@teranovaglobal.com.