IT Sales Through Distributors Showing Growth: Report

By Nathan Eddy  |  Print this article Print

Major U.S. growth categories include PCs, notebooks and printers.

Although some indicators suggest slowing or potentially contracting IT industry sales, members of the Global Technology Distribution Council have been reporting solid growth.

Despite widespread caution, there are plenty of reasons to be optimistic on both sides of the Atlantic, said Tim Curran, CEO of the GTDC, which conducts a thorough analysis of industry trends based on the NPD Group Distributor Track in the United States and Context SalesWatch in Europe. "We’re seeing steadily improving market conditions for distributors—not signs of a [contraction]," he said.

In the United States, third-quarter PC sales grew 18.6 percent from the same period last year, while sales of notebooks rose 16.5 percent, printers, 20.5 percent, and monitors, 19.3 percent, according to the GTDC analysis.

IT distributor sales were strong through the third quarter, up nearly 15 percent in the United States on a year-over-year basis, Curran said. "The more compelling indicator of an overall industry recovery, however, is that U.S. and European market sales are now consistently exceeding peak levels achieved prior to the downturn in 2008," he said.

D&H Distributing Co. has seen considerable improvements in demand, according to Dan Schwab, co-president of D&H, which is a GTDC member and has distribution operations across North America. Vertical markets like health care are picking up momentum at D&H, which has also experienced growth throughout the year across most of the product lines it offers.

Schwab attributed some of the new growth to advanced technologies now more clearly moving into small and midsize businesses. "More sophisticated products and capabilities have moved downstream from previously only being found in—and designed for—larger enterprises," he explained. "Such business innovations are more affordable today, and the vendor community is working proactively with distributors to bring these solutions to their SMB-focused partners."

The change is evidence that the market was undergoing a "significant departure" from the days when the "direct mantra" was touted by many IT companies, Schwab said. "Now, they typically realize that distribution is the most cost-effective, best way to reach and effectively serve the solution provider community. This channel clearly has the advantage in selling to and supporting SMBs as well as many larger enterprises worldwide. It happens in strong partnership with distributors who have the channel-centric business models to meet their unique requirements," he explained.