Vodafone reinstates Fone Logistics


Vodafone has reappointed distributor Fone Logistics for airtime connections, part of a u-turn by the operator in its approach to the indirect channel.

Vodafone terminated Fone Logistics’ airtime agreement in late 2006, a move understood to have cost the distributor around £1 million in revenue.

It marked a general withdrawal from the channel that also saw Carphone Warehouse on the high street and distributors HSC and MoCo in dealer sales canned.

New UK management has revised its strategy, however. Carphone’s Vodafone licence was reinstated in July.

Despite continued disruption to its indirect channels through the first part of 2009, UK enterprise director Peter Kelly has since developed new appetite within Vodafone for third-party business sales, and the move to re-engage with Ian Gillespie’s Fone Logistics has seen the market speculate HSC and possibly MoCo will also restart as Vodafone distributors.

The planned disposal of Redstone, meanwhile, appears to have been put off, as Vodafone has developed a new product portfolio specifically for the SME sector and Redstone’s influence in the market has increased as part of Daisy Communications, which paid £17 million for its parent unit in August and has significant reach in SME sales across a number of product lines.

Avenir is not expected to rejoin as a Vodafone distributor.

Fone Logistics, which ranked number one in terms of volume among distributors for O2 airtime last month, will be utilised by Vodafone for business voice and data connections only. A choice band of Fone Logistics connectors will be selected.

Vodafone sales director for small and medium enterprise Rob Shardlow said: “We are delighted to renew our relationship with Fone Logistics and a select community of its key partners who want to develop and grow their business with us. We are happy it shares our vision of
delivering quality and value to customers.”

Vodafone is expected to reveal shortly that its old service provision business Yes Telecom will be utilised as its central distribution house for all its appointed connecting dealer and distributor partners.

A major part of its refocus on the dealer market comes with roll out of its OneNet unified communications (UC) proposition.

Kelly told Mobile News: “It will pay for dealers to start to specialise and understand what UC can deliver. I don’t expect them to do it alone – because  we, as operators, need to change the way we do business, especially with our partners.

“I’m glad to say we are already on this journey. We are building a model that wholeheartedly supports our indirect partners, which feels no conflict between direct and indirect sales, and which will ultimately produce the kind of high-value, proactive lead generation that the IT industry has produced for its channel for years.”

Fone Logistics restructured earlier this month, moving its trading operation into a new unit. It will engage key partners at an event to launch the new agreement in the next few weeks. 

The deal sees Fone Logistics working again with the UK’s three leading networks, plus 3.

Vodafone group chief executive Vittorio Colao was asked last week whether consolidating its UK distribution channels in 2006 had been unwise.

He said: “I don’t believe rationalising distribution in the UK was a bad idea. It was an unsuccessful decision. So we said fine, let’s go back to a different distribution model.”

Mobile News reported last issue Vodafone is establishing strategy to regain market share ahead of its demotion to number three network operator with the merger of Orange and T-Mobile next year.