Channel visions - PC Retail

Channel visions

Key players across the industry on the challenges facing the Channel in 2018
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Jeremy Nash, Centerprise International, CEO:

Jeremy Nash ON Ci BCGRD

The Channel is healthy at this time but it is not without its challenges. The squeeze on margin is requiring vendors to be more innovative with their offerings, which in turn is creating further opportunities for distributors and resellers. No doubt, the driving down of reseller margin caused by customers seeking to commoditise the procurement of hardware will be one of the biggest challenges over the next year or so.However, there will be several drivers over the next 12 months. In particular, the shift towards service-based offerings, be it cloud or more traditional IT solutions. Offerings that enable efficiency in the workplace, such as enhanced end-user mobility and the streamlining of both customer-facing and internal processes, will also shape the market. These market drives, coupled with customers appetite to completely commoditise the procurement of hardware, will see traditional hardware resellers seek to move into becoming solutions providers.

Value added distributors have a role to play in enabling smaller companies to succeed in the Channel. With the drive towards service-based offerings, small companies need support with selling services and not just products.

It may seem a little obvious to state, but we would all benefit from carving out sufficient time to be able to talk to one another with the aim of sharing our respective goals and challenges. This would enable us to find any overlaps that exist and work together with common purpose for mutual benefit. We all run the risk in business of spending too much time on obsessing over internal issues at the expense of facing outwards. 

Sarah Shields, Dell, Vice President and General Manager UK & Ireland:

Sarah Shields

The UK channel is as strong now as I’ve ever seen it. From our perspective, we are seeing growth across all our key lines of business indicating that there are plenty of opportunities for our Channel partners looking to increase revenue and a hunger from customers looking at digital transformation.

We all need to be focused on delivering the right solutions during this growth phase. Both vendors and partners need to be clear on how digital transformation should be delivered and help customers with their multi cloud/ hybrid cloud solutions and focus on long-term workload solutions that need to be addressed.

Without a doubt, the biggest driver in the next 12 months is about making digital transformation a reality. With GDPR coming into force, it’s a perfect opportunity to address and assess how to future-proof customers’ businesses and make them secure. Anyone not talking security is making a big mistake.

Disruptors are what the market is all about right now. New names, new brands, new technologies that change the way we work and play. The Channel is perfect for disruptors to gain momentum, traction and scale – but beware, big organisations such as Dell EMC are taking disruption very seriously too as we are investing $4.5b a year in innovation.

I’ve never seen our Channel so exciting! Right now, the Channel is doing exceptionally well and growing every day, so things are looking good.

Craig Hume, Utopia Computers, Managing Director:

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While I think it would be wrong to say the UK IT Channel is strong, given the sad news around Maplin and the continuing political uncertainties that lie ahead, I would say that the overwhelming majority of the conversations I have are positive with strong desire to continue to grow and innovate.

The skills gap is always going to be difficult, I take my hat off to the likes of VIP who are doing amazing work by investing in a young team to bring new people in to the Channel that could end up being some of the top talent in any one of our businesses. I worry GDPR is also going to hit some hard, possibly too hard to recover. I speak to resellers and many are not prepared and have decided it’s too confusing to be bothered with, this is not great news and I fear that those who have chosen to put their head in the sand have not only missed an opportunity to be seen as a leader in this area, but will possibly be on the wrong side of the ICO when something happens to their data.

Over the next 12 months it will be particularly interesting to see where blockchain goes, the effect it has on the GPU and PSU markets and how vendors address it. Will the likes of Nvidia release mining specific cards as rumoured or just ride the wave? Also the battle between Intel and AMD continues, so it’ll be interesting to see what happens as AMD are now back in the game.

For those looking to get started, I think that in many ways it is now easier for small startups to break into the Channel than ever before. I believe if a startup has a global mind-set, a killer idea and the right people on the bus, the sky’s the limit. The important thing is to always be open, honest and keep talking. Utopia has built outstanding relationships by always just telling our partners the way that it is, not trying to pretend we are something we are not. 

Steve Wilson, Norton by Symantec, Director, Field Sales and Marketing UK and Ireland:

Steve Wilson

In a declining market, the UK Channel needs to look at how it can innovate in order to retain its value. This has been the picture for the last few years. We’re yet to see the kind of market-wide disruption or innovation that could change this picture.

One of the biggest challenges for the channel over the next 12 months is uncertainty. The forces of Brexit and the continued economic uncertainty is creating cautious consumers. Consumer behaviour is undoubtedly changing, with a focus on experience and the rise of the subscription economy, but it’s the effect of uncertainty on spending which is having the biggest impact.

It’s also becoming increasingly difficult to distinguish the brands and technologies that will win big. The pace of change in technology means that there are no more ‘safe bets’. Big brands continue to diversify into apparently established spaces. But at the same time, even the biggest brands aren’t immune to failure with experimental new products and categories.

I expect the Internet of Things will have a significant impact on the Channel over the next 12 months. It’s been talked about for a long time, but these devices are finally becoming visible in people’s homes through devices like Alexa, Nest and Google Home. More connected devices, not just display technology, are becoming part of our daily lives. There is more and more a drive towards a connected home - but unfortunately security of for most of these devices remains a step behind.

New products and categories will continue to emerge with start-ups and big brands alike providing exciting new opportunities. 

Paul Routledge, D-Link, Country Manager UK & Ireland:

Paul Routledge

The UK IT Channel is in a constant state of change, as we see the ever growing shift from a predominantly retailer driven environment to more of an e-tailer model. Adding to that is the number of companies rapidly leaving and joining the IT industry. Despite this, it is undoubtedly a strong Channel and will continue to be, as there are lots of new technologies being launched, along with many companies looking to innovate routes to market.

The shift from a traditional retailer to an e-tailer model or incorporating both, as many vendors opt to move towards selling via online platforms such as Amazon, will continue to be a challenge. Another challenge will be the need to remain compliant with new initiatives, such as the introduction of GDPR. As ever, the channel will need to ensure it remains focused on security as new technology brings new security risks. Personally speaking I know this is always at the forefront of our business.

I expect to see a rise in switching technology, particularly for D-Link, industrial switches, as this supports the growing development of smart cities and demand for more advanced technology. I also see the smart home as being a key driver that is yet to peak. Although there are now established players in this space, there is a lot of room for the development of more integrated products and devices, which opens up opportunities for vendors.

For all Channel partners, fully understanding the chain of communication between the end user, reseller and vendor, and ensuring this runs smoothly is also essential. I think the Channel as a whole has a lot of room for improvement on the communication side so it’s definitely something we will be looking out for this year.” 

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