Chinese telecommunications and networking firm Huawei Technologies Co. Ltd., has issued a rather glum-looking pronouncement for anyone still following the classic ‘man-in-the-middle’ sales model, saying that one quarter of all resellers will be out of business in the next five years.

According to The Register, the company believes that not only will one in four resellers disappear altogether, but the rest will need to “transform themselves from a distribution type into a more competent type [of business].”

Huawei says those resellers which pursue a “price-centric competition strategy” will be the fastest to fade, saying that only the fittest will survive as the industry follows a natural selection process.

And that could be bad news for vendors who rely on resellers, Huawei believes.

“If [vendors] rely on this model to do their business, in this competitive market, they may become extinct,” it said in reference to companies like Cisco Systems Ltd., IBM, and Hewlett-Packard Co., which it believes are “too reliant” on resellers.

Instead of resellers, Huawei is following a new model called “solution selling”, in which the company focuses on hardware while its partners will try to sell “business “solutions” as part of a “co-innovate” partnership approach.”

Huawei’s somewhat harsh words are perhaps a reflection of the struggles it’s had trying to establish itself in European markets, where its sales are still “tiny” compared to other markets. Three years ago, Huawei announced bold plans to attract 1,000 resellers across Europe – but that plan failed miserably, with the company securing partnerships with just a fraction of that number.

“Recruiting resellers [has been difficult] due to our marketing and branding in specific markets and we need more time to attract resellers,” said Leon He, Huawei’s Enterprise Business Chief in Europe, to The Register.

Photo Credit: Stuck in Customs via Compfight cc