What, the Channel Worry?

By Pedro Pereira  |  Posted 2006-11-02 Email Print this article Print
 
 
 
 
 
 
 

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Opinion: You would think a pending economic slowdown would worry the channel, but many solution providers are feeling confident about the future.

Ongoing talk of an economic slowdown had me thinking I would encounter a bunch of skittish solution providers last month at an industry event.

Instead, every time I asked solution providers if they were worried about the slowdown, even a possible recession, the response amounted to nothing more than a shrug. I had to look down at my feet to make sure I wasn't floating and pinch myself to make sure I was awake.

Channel executives with no worries? What's the world coming to?

The confidence of these solution providers, who gathered in Palm Springs, Calif., for distributor Ingram Micro's VentureTech Network conference, was something I haven't seen much before in the channel. Sure, occasionally you come across boisterous, boastful types who claim they've have found the sure-fire business model that guarantees success and a retirement home in West Palm, but those guys tend to self-combust in short order.

I wasn't talking to boastful guys here. These are folks who for the most part have been in the business long enough to remember when "World Wide Web" was little more than a buzzword, when "mail" was only something you put a stamp on and prayed it was delivered to the intended addressee.

No, ma'am, these folks are well aware of the fickle nature of the market, and some even bear the scars of past economic slowdowns and business models that failed to deliver. I am talking about folks like Howard Cohen, president of LAN Associates Network Solutions, of Central Islip, N.Y.; Ray Morton, director of technical services at Daly Computers, of Clarksburg, Md., Ron Cook, owner of Connecting Point Technology Center, of Las Vegas; and Jane Cage, co-owner of Heartland Technology Solutions, of Joplin, Mo.

It isn't that these folks are living in a self-delusional, rose-colored fog. The reason for their confidence is that each has found some type of niche that makes them somewhat impervious, if not totally immune, to an economic slowdown, be it a specialization in certain technologies, a strong emphasis on services, or both.

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Cook's Connecting Point Technology Center, for instance, has staked much of its future on a disaster recovery/business continuity service, which the company manages remotely over the Web for its customers.

LAN Associates, for its part, has been focusing on such client needs as e-mail services and archiving. The solution provider's clients, many of which are law offices, have great needs for storage technology that allows them to comply with federal regulations on archiving e-mail and instant messages.

As Cohen sees it, the economy may slow down, but his clients' needs will not disappear because the regulations triggering those needs are here to stay.

Variations on Cohen's reasoning were in abundance at the Ingram Micro event, and I have found the same in communications with solution providers since then.

A pending economic slowdown in the past would have had channel companies scurrying to push as much product out as possible, just so they could get enough volume to survive on tight profit margins. But with a growing emphasis on specializations, solution-selling and services, a growing number of solution providers feel better equipped to weather any storm the forces of economics can brew up.

That is not to say the channel is being nonchalant. Memories of the prolonged recession at the turn of the millennium remain all too vivid. As Scott Goemmel, executive vice president of PMV Technologies, a solution provider in Troy, Mich., puts it, "Economic slowdowns are always a concern." But Goemmel feels his company has the right technology, services and customer segment focus to grow profitably.

It is that strategic balance of offerings and customer focus that is fueling the current confidence in Goemmel and many of his peers.

Pedro Pereira is editor of eWEEK Strategic Partner and contributing editor to The Channel Insider. He can be reached at ppereira@ziffdavis.com.

 
 
 
 
 
 
 
 
 
























 
 
 
 
 
 

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