Resellers feeling good about 2020

Resellers are feeling more optimistic about the year ahead after what has been a fairly decent 12 months and are looking for growth from both traditional and emerging product areas.

Listed players like Computacenter and Softcat have shared numbers that indicates 2019 has been solid and anecdotal evidence from other resellers also indicates that for many the market has rewarded those able to deliver high quality products and services.

Context has produced its latest ChannelWatch report, based on quizzing 6,500 resellers across the UK, Ireland and most of the rest of Europe and Russia.

The headline finding is that optimism is higher now than it was at this point a year ago. That is largely down to the momentum that has been generated in 2019 and a feeling that it will continue into 2020.

There is also an expectation that product categories, including IoT, are going to be revenue producers for the channel. Investments in some of the traditional areas is running in parallel with moves to make sure that emerging technologies are also covered.

Context has drilled down into where B2B resellers are looking to make investments over the next 12 months: cloud (49%), networking (46%), cybersecurity (38%), workplace optimisation (31%), datacentre solutions (24%), and IoT (18%).

B2C specialists were continuing to be more hardware led: PCs (57%), software (39%), storage (37%), components (36%) and printers (36%).

“Although B2B resellers expressed a more positive opinion of the coming year than B2C resellers, sentiment overall has strengthened considerably overall across the region, driven by a sharp increase in optimism in the UK and Germany. This is despite continued Brexit-related uncertainty and slowing GDP in Germany,” said Adam Simon, global managing director of Context.

The analyst house found that the 3.4% growth in distribution in the nine months ended 30 September was slower than the previous year’s figure of 6.7%, but that had not dampened the positive feelings about 2020. The ChannelWatch report also found that there are more new resellers entering the market than the number exiting, underlining the growth and health of the indirect world.

“It appears that many resellers experienced far higher growth last year than the headline figure for revenues in the distribution channel. We believe this is due to corporate digital transformation efforts, investments in cloud and IoT as well as classic drivers like the Windows 10 upgrade”, Adam added.