Industry experts shed light on the challenges faced by channel partners in taking networking products to the SMB segment
Small and medium-sized businesses in the Middle East have unprecedented access to new markets, suppliers and customers. They are constantly looking at understanding industry dynamics and devise holistic solutions that can help achieve the quantum leap required to dominate the market. Even enterprise vendors are now increasing their focus on small and midsize businesses due to the size and demand in this market. Today SMBs are embracing mobile and cloud technologies to improve employee productivity and engage with customers. As reliable network performance becomes more important and security threats target organisations of all sizes, there is a compelling case for small businesses to deploy diagnostic network tools.
Analyst IDC has stated that the total global IT spending by SMBs was nearly $602bn in 2018, with a compound annual growth rate (CAGR) of 4.7% for the 2016 to 2021 forecast period. IDC further adds that mid-market firms will account for the largest share of total SMB IT spending even though they are farther along in technology deployment than small businesses. With channel stakeholders being urged to do more to help SMBs overcome some of the barriers to networking technology adoption, opportunities for solution providers in this sector are huge.
However, there still remain barriers to networking technology adoption among SMBs in the region since many have limited in-house IT expertise and rely on their partners or service providers for some or all of their network management requirements. Cost containment is a crucial factor for a number of customers. However, customers’ spending is also largely dependent on marketing and selling skills.
“For many SMB customers, the desire to buy new technology is determined by availability of funds and the business pain points that affect their operations. Moreover, with the number of vendors and solutions available is sometimes confusing for customers to make the right choice,” says Ashok Kumar, CEO of NewTrend Computer Networks.
Channel partners need to study the requirements of their customers and analyse them to be able to offer them solutions that fit their needs rather than confusing them with variety. “Customers are happy to be spoilt for choice, but not to the point that it starts giving them trouble in deciding. The right solution needs to be offered to the customer in the right manner for them to want to spend on the latest networking technologies and services. Being customer centric is crucial,” says Sony Mathew, channel manager-SMB of TP-Link.
While SMBs benefit from solutions that are simple to install and maintain, what they really need are solutions tailored specifically for their particular industry. This is where a value-added distributor or vendor can help an SMB maximise the business value of its technology investments. Further, it is the responsibility of the channel partner to connect with the right vendor and invest in optimum solutions. To be successful in an increasingly competitive IT landscape, vendors and distributors need to identify valued partners and provide necessary training for them to succeed and develop clearly defined goals.
The biggest challenge for channel partners is competition, as the number of new entrants continues to grow resulting in a reducing customer base available to channel partners. – SONY MATHEW, CHANNEL MANAGER-SMB, TP-LINK
“The biggest challenge looming over channel partners is competition, as the number of new entrants in this space continues to grow resulting in a reducing customer base available to channel partners. The key lies in listening to the customer rather than overriding their remarks with sales pitch,” adds Mathew.
Another challenge accompanying this growing networking market is the escalating security landscape. This challenge has in turn opened opportunities for channel partners to offer surveillance and security products that are now increasingly relying on networking technology.
“We design a wide range of networking solutions, including those serving this expanding market segment. We also offer an excellent range of Wi-Fi solutions that are based on robust SDN architecture that enables partners to offer managed services to their clients. We make cloud cameras to cater to the surveillance needs of our clients and also provide switches to support a variety of Wi-Fi and surveillance requirements,” says Mathew.
Ease of installation, usage and management are absolutely essential for small and medium business owners. With 5G and Wi-Fi 6 coming there are new streams of expansion available for channel partners. – ASHOK KUMAR CEO, NEWTREND COMPUTER NETWORKS
“As a leading value added reseller in the networking space we are also providing customised solutions to SMB customers. As end users look for a faster and secure network, and with 5G and Wi-Fi 6 coming there are new streams of expansion available for channel partners,” adds Kumar.
Managed services and IoT will be the driving forces behind the growth of networking solutions as both require infrastructure for support. “The most attractive growth and profit margins lie in managed services. If you look at the distributors of fast-moving finished goods from the leading brands, those with franchises have certainly done better when it comes to sales numbers than those without. IoT is also finding increasing applicability in everyday life and therefore requires larger and stronger networking infrastructure and solutions going forward,” explains Mathew.
However, the market for small and midsize business IT services is large, varied and challenging to address. Channel companies need to overcome technical and financial obstacles among their SMB customers to encourage them to acquire and adopt new technology and services. Before implementing any strategy to encourage networking technology adoption, solution providers must bear in mind that SMBs are not buying technology because it is something nice to have, but because technology helps to solve their business objectives.