- The SB PC and printer market is almost fully penetrated (especially in mature countries like the US), so most new purchases are replacements. SBs are therefore more informed and knowledgeable about their needs, making online channels a more efficient buying experience versus visiting a retail store.
- Low prices and customizable configurations available online create a straightforward purchasing experience for SBs.
- Traditional hardware resellers—value-added resellers (VARs)- are shifting their business model towards services due to low margins in IT hardware, which allows DMRs and other low-cost online channels to grab that share of the market.
- In addition, the economic downturn forced many SBs to look for channels that offered lower costs for new purchases and upgrades.
The above trends are more unique to the US and EMEA markets. In APAC and other emerging countries, SBs still prefer to buy from local IT stores (or, storefront VARs) and channel partners.
“Local computer/electronic stores, also known as storefront VARs, still have a strong presence in emerging markets,” says Avinash Arun, Manager of the Channels Practice at AMI Partners. “IT maturity among SBs in emerging countries is low (compared to the Americas and Western Europe), and therefore these firms especially need external support for sustaining their IT environments. The local stores serve the purpose of both a retail store and a channel partner: a small business owner or IT manager can walk into their neighborhood electronic or IT store and have a ‘touch and feel’ experience, while receiving essential service and support for installation, maintenance, troubleshooting, etc.”
Another channel that’s slowly gaining traction in the SMB computing hardware space is the telecommunications provider. Telcos, which have been the predominant channel for Internet and telecom products and services, have been expanding their presence in the IT market over the last couple of years, especially within mobility and hosted services.
“The telco model is shifting as we speak and AMI expects telco market share to vastly increase in the IT markets over the next five years,” adds Mr. Arun. Telcos are leveraging their vast customer base to provide add-ons, such as notebook PCs, netbooks and software solutions, bundled with broadband and voice services. This enables small and medium businesses (SMBs) to purchase a greater number of IT and telecom services from a single provider.
