4 February 2021

The channel sees record growth during the pandemic – but what’s next?

Smart Living

by Christine Horton

The biggest talking point in the IT channel in recent years has been the move away from the volume-based, transactional ‘box shifting’ model of sales to a services-led, consumption-based model that provides a recurring revenue stream to resellers. We’ve seen dwindling margins on hardware force resellers to look for alternative revenue streams, with offerings like managed services being touted as a key to growth.

Which makes the events of 2020 incredibly interesting from a channel perspective. This is because it has been the box shifters – those that could equip customers’ new remote workforces with desktops, notebooks and tablets – that have benefited the most during the pandemic.

In October channel analyst Canalys reported a four percent growth in the EMEA channel in the first three quarters of 2020. This is compared to an overall EMEA GDP decline of nine percent during the same period.

Canalys CEO, Steve Brazier, even noted that vendors may be pushing services too hard on to their partners. “We talked about the PC being dead 10 years ago, and so partners stopped selling PCs. That was a mistake. Those companies still selling volume goods and a portfolio of products are the ones that are doing best right now.”

Distribution too is experiencing a boon. IT market intelligence firm Context says sales in IT distribution across Europe could hit double figures year-on-year in the first three months of 2021 as strong demand continues from the end of last year.

Home working and studying categories such as mobile computing continue to drive this growth amidst ongoing lockdowns – notebooks recorded 70 percent sales growth in the first two weeks of the year.

Going the extra mile

As we’ve seen, channel partners have been instrumental in helping their customers through the pandemic. In many cases they have been with them on the front line, ensuring their businesses stay up and running.

However, it is just as important for them to think about how best to serve their customers moving forward. And while it is hard to forget what an unusual and stressful time this is for everyone, it is a perfect opportunity now to go the extra mile for customers.

For example, IT vendors have rolled out a series of measures to enable partners to support their customers, whether by offering new solutions or extending financial credit. The channel plays a key role in helping customers make sense of those offers and getting them implemented quickly and without disruption.

It’s also important to note that despite enforced distancing, we are all showing our human side a little more now. Almost daily we are invited inside customers’ homes where we experience a more personal connection. It is a time for empathy and kindness, and any assistance that the channel can extend at this time will be well-received.

This ‘compassionate credit’ will go a long way; customers will remember those companies that helped them out during such an uncertain time.

It will undoubtedly be a challenge – as we know, the channel is a relationships business and thrives on face-to-face engagement with customers. Both partners and distributors will have to find new ways of communicating and problem-solving in this new normal.

But despite ongoing unpredictability for partners themselves, it is a perfect opportunity to become the ‘trusted advisor’ their customers need, now more than ever.

Photo by Freddie Marriage on Unsplash