Preparing for growth

With the regional channel continuing to show signs of an upturn, the spotlight in the market place is on the impact of mobility products such as tablets, Ultrabooks and smartphones, as well as the anticipated launch of Microsoft’s Windows 8

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Preparing for growth ((ITP Images))
By  Manda Banda Published  July 19, 2012

With the regional channel continuing to show signs of an upturn, the spotlight in the market place is on the impact of mobility products such as tablets, Ultrabooks and smartphones, as well as the anticipated launch of Microsoft’s Windows 8. Is the second half of 2012 going to propel the channel to new heights?

The Middle East and North Africa (MENA) channel has had it tough over the past three years. Product margins have continued to be squeezed, while lethargic sales and commoditisation of IT products, protracted sales cycles and increased rivalry in the cutthroat IT solutions selling game are some of the difficulties that channel partners have had to endure.

And negotiating scarce resources and necessary investments needed to spur business growth has not been straightforward in the regional channel, given the global economic meltdown that shook the economy in 2009.

Now, however, there are signs of an upturn on the horizon. The channel business has been good in the first half of the year although it slowed a bit in the second quarter of 2012. Channel stability and confidence has been on the up, buoyed by the fact that events that rocked the Dubai channel mid-way through 2011 are not there this time around. So what does this mean for those that are playing in the MENA region IT business? Just how should all channel stakeholders prepare for the anticipated growth that many are hoping will happen in the second half of the year?

To put things into perspective, we have to look at what characterised the regional channel in 2011.

Although political challenges continue to linger in some places in the region, in those countries where stability has started to return, we have seen some markets opening up to new business investments. This hasn’t gone unnoticed especially by some Dubai-based distributors who have shown interest in setting up operations in markets like Iraq.

In the Dubai channel, the spate of reseller runaways that we saw during this time in 2011 are no longer there and credit must go to the yeoman job that the Dubai Computer Group and its members have done to restore business confidence in the channel.

At regional level, distributors have continued to be more prudent in how they engage with their channel ecosystem while at the same time they have been expanding their footprint into new untapped markets in the Middle East.

As many stakeholders in the channel have expressed optimism about business prospects in the second half of the year, the question that needs to be addressed is how should channel partners prepare for this predicted boom?

The IT industry as a whole has presented new launches and new technologies that provide opportunities for the channel, in areas such as mobility, cloud computing, tablet devices and Ultrabooks.

There is no doubt that Intel’s drive with its super thin, light-weight notebook form factor will not only open up opportunities for resellers selling PCs, but will also challenge the established order of the tablet market in the region. Added to this, Microsoft’s eminent Windows 8 launch will lead to PC hardware upgrade cycles, something that will be an added bonus for partners epecially in emerging markets where PCs are still growing at double digit figures.

Sadly, not every partner in the Middle East will benefit from this expected market boom. Partners that will profit from business opportunities that are emerging as a result of these advancements, are the ones that have continued to evolve and increased their investments in training, certifications and specialisation programmes even in the most difficult of times.

Vendors and distributors can do so much to create a ‘conducive’ environment for reseller businesses to flourish in the market, but those that will win are partners that have taken the long-term outlook on the market, acquired the needed business acumen to add value to the product and solutions they pitch, and continue to remain relevant to their end-user customers.

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