Balancing act

Every IT provider wants a piece of the small and medium-sized business (SMB) sector these days. But the ever-changing nature of this highly competitive market means that resellers which are serious about success must perform a balancing act between their own capabilities and what customers actually want

Tags: Belkin International IncorporationCisco Systems IncorporatedHP Middle EastPro TechnologySMBSymantec CorporationUnited Arab Emirates
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Balancing act Claire Jones, Cisco. (ITP Images)
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By  Andrew Seymour Published  February 10, 2010 Channel Middle East Logo

Small and medium-sized businesses (SMBs) remain the lifeblood of many vendors and channel players, especially in the Middle East where the SMB sector is typically thought to account for as much as 60% of overall IT spend.

Indeed, research cited by accounting software vendor Sage in 2009 suggests the value of the regional SMB market is now close to US$10 billion a year and could come to represent up to 80% of businesses by 2011.

The pertinence of this budding market sector means it is also heavily fought over by vendors and their partners alike, especially as SMBs are renowned for buying through both the consumer and commercial channels to satisfy their IT appetites.

As technology becomes increasingly important to the way in which SMBs operate, the resellers in the Middle East face the challenge of adapting their sales strategies and keeping up with the offerings that are needed to properly cater to such entities.

There are some specific points that the channel needs to bear in mind when targeting SMBs, suggests Prajit Arakkal, director of SMB and distribution sales for emerging markets at security software vendor Symantec.

"In many ways, small businesses are similar to their large enterprise counterparts," he said. "They invest a tremendous amount of time, money and resources to make their businesses successful. Like them, they need to ensure business continuity even in the wake of a disaster. However, they are working with fewer resources and every dollar and hour counts."

Symantec, like many other brands, has already gone down the route of developing exclusive programmes to drive SMB sales. Last year it launched a ‘small business specialisation', which offers dedicated tools and support to resellers that are qualified at silver level or above on its partner programme. Benefits include a volume rebate of up to 3% and access to marketing development funds for small business products.

Networking behemoth Cisco is also doing its part to give resellers every chance of succeeding in the SMB market. It has developed a series of SMB sales initiatives, one of which is the ‘Select' certification programme. In the UAE alone it has more than 500 VARs covering the SMB segment and 120 of them are certified on the programme.

Claire Jones, SMB regional sales manager for the UAE at Cisco, says investments are largely being channelled into partners, technology and support. "These three pillars of Cisco's small business strategy will help companies with fewer than 100 employees gain a competitive advantage and enable the channel partners that serve them to build profitable, sustainable small business practices," she explained.

A year ago Cisco even created a ‘small business council', underscoring its belief that it can realise US$10 billion in revenues from the global small business market, particularly now that it operates combined channel programmes for its Cisco and Linksys product lines.

Perhaps one reason why the appetite for SMB growth remains so strong among vendors is the resilience that the sector has shown during the downturn. Although SMBs have been under the same pressures as any other tier of the market, there is a perception that they haven't been hit as badly as the large corporate organisations.

Youssef El Arif, national account manager at PC accessories and connectivity vendor Belkin, agrees. "We don't really feel that the SMB performance was greatly affected by the global credit crunch," he reflected. "ICT channels are moving full steam ahead and with Belkin introducing a number of new innovative products last year, there were quite a few offerings in the market place for SMBs to get their teeth into."

Not everybody shares the view that the SMB market weathered the storm, however. Jamal Maraqa, managing director at Apple products and accessories reseller Pro Technology, insists the SMB sector was "one of the most affected". This was reflected in the number of companies that reduced their IT budgets or delayed projects, he says: "Because many of them don't follow long-term plans and attempt to do business on a day-to-day basis based on the information available at the time, those parties appeared to be scared about what the future was hiding."

Whatever the consensus on the SMB sector's ability to navigate the downturn, there is widespread hope among the channel that 2010 will mark the return to a more stable and predictable buying environment.

The big question, then, is how the channel actually goes about addressing the SMB market and giving it the specialist attention it warrants. Just what does an SMB want from their preferred supplier or IT provider?

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