Channel trends worth watching
By Robert C Demarzo
For the past few weeks, our attention has been glued to the race for the White House and the meltdown on Wall Street, which has gone global. Watching one can make you ill, following the other can make you suicidal. But despite those issues, you need to focus your attention back on some of the most pressing matters in the channel. Here are several trends the content team here at Everything Channel is carefully watching.
Will the credit crisis crunch the channel? Right now, it is not clear how today's SMB-focused VAR is going to be impacted, but many are feeling the pinch of banks or lenders pulling back. There may be some VARs who will be negatively impacted, and some cash-strapped firms will be forced to close. Those most affected will be ones who have not grown their services business or are too dependent on one customer or vendor.
Meanwhile, we are already seeing attempts by some distributors, such as D&H, to make more credit available to small solution providers. Keep in mind that the debt levels of many distributors have fallen to new lows, which should enable them to help VARs through this crisis.
Channel recession or not? The channel will certainly not be immune, but the news might not be all that bad. The latest data from Raymond James indicates IT shipments through North America distributors—which account for $120 billion in hardware, software and networking gear—will be down 0.3 percent in the third quarter and the outlook for the fourth quarter looks flat to down. Consumer channel shipments are also slowing and are forecast to be down 1 percent this year. But during downturns, vendors turn to partners more than ever. For one, vendors can reduce their own costs by relying more on partners instead of direct-sales efforts and it gives them access to a broader customer market, particularly small businesses.
How will new channel initiatives be impacted? Samsung is preparing to enter the mainstream notebook market in a big way, competing against the likes of Lenovo, Dell and HP. Best known in the channel for its displays, Samsung has been making inroads in the printer market and is trying to move upstream. Like Samsung's move to diversify, Lenovo is shipping new servers in hopes of growing its channel footprint beyond ThinkPads. The problem it will face is trying to displace HP. Both are examples of vendors looking for ways to further leverage their channel and find avenues to grow their businesses. The only way they can be successful is helping VARs get through one of the most challenging economic periods we have faced in years. |