News in the Channel - January 2023

NITCH 2023 PREVIEW

Marie Devlin , head of marketing, Network Group If the past three years are anything to go by, I think we must expect the unexpected! With rising stagnation and inflation in the market expected throughout 2023 (and beyond) there are plenty of potential squeeze points for IT channel businesses – throw in an energy crisis, ongoing supply chain challenges, rising staff costs and labour shortages – it’s no wonder that many people are not looking forward to the coming year, or are at least approaching it with caution.

flip side, with the absence of geographical barriers we are no longer limited to serving customers in our locale and can have clients anywhere across the globe, significantly increasing our pool of prospects. With increasing expectation from customers channel businesses offering a full spectrum of services will be better placed to capture market share. Acquisition could be a quick route to access more resources, niche skills and experience or entry into desirable vertical markets. There will also be recruitment and retention challenges: Skills shortages continue to put a strain on recruitment strategies; we’ll need to get smarter with recruitment and attracting candidates in the IT channel and retaining incumbent employees. Cost-of-living pay increases will be out of reach for many businesses and I think now is the time to reconsider traditional employee benefits and whether enhanced ‘softer benefits’ can counter below-inflation pay increases. Tough economic conditions are not just affecting the public. Channel businesses are likely to be facing some tough financial decisions in the coming year. We’ve heard about high-profile organisations – Amazon, Meta and Twitter are the latest – slashing employee numbers, so downsizing is a concerning trend in the tech industry. Ultimately, we are all ‘customers’ and the sentiment we have at home will be bought into the office with us, likely meaning an increase in customers cutting back on spending, an increase in credit use and a reduction in buying power, with delays in the buying decision or deferment of budgets. The cost-of-living crisis is predicted to have a detrimental effect on employees’ wellbeing, so now is the time to focus on your own staff and consider initiatives designed to help improve employee morale, motivation and engagement, all of which can help businesses withstand a recession. Overall, we are well placed in tech to withstand the challenges coming our way in 2023. Being flexible to change, working collaboratively and maximising your relationships is the key to success. Leverage your partnerships more than ever – evaluate their capabilities, strengths and take advantage of the available tools and resources you need to win and succeed. There is a vast amount of help and support available to businesses across the channel, particularly from vendor partners – from advice and training to financial assistance and help making any necessary investments in your business.

Marie Devlin Network Group

In terms of growth, technology is often painted as a relatively recession-proof sector, and, dare I say if, you work in IT your business may even have benefitted from the opportunities that came about because of the pandemic. IT will prevail, but organic growth will be challenging in 2023. Gains made now are likely to be about ‘share-of-wallet’, not market growth. Elsewhere, AI and machine learning solutions will continue to gain pace. The customer will continue to be king and a renewed focus around innovation, operations and customer service will be required to meet customer expectations. Customers want their problems solved as quickly as possible and to transact and interact with us in a way that they choose, be that WhatsApp, Messenger, Chat or the metaverse! It’s about putting the customer first and making sure they can get in touch with you in a frictionless way. We will see more desire for self- service and more AI in decision making – how we help our customers adapt to that will be critical. Financial investment is going to become more challenging to acquire for businesses in general, as end users are understandably taking a more conservative approach. There will be more scrutiny around budgets combined with diminishing brand loyalty. But people buy from people; to sell well channel businesses will need to get to know their customers better and find out what they really want. A more consultative approach – providing an overall solution with wraparound product/service support – will likely be more successful. Is your product/solution a ‘must-have’ or a ‘nice-to-have’? Find out what your customers want and make sure you are in the ‘must-have’ bucket. Meanwhile, trends from 2022 that will continue this year include remote working, cloud adoption and cybersecurity. The hybrid set-up and accelerated cloud adoption are not going anywhere and with this comes challenge and opportunity. The most significant challenge of work-from-anywhere is to provide a comprehensive and cost-effective cybersecurity solution. On the

People buy from people; to sell well channel businesses will need to get to know their customers better and find out what they really want. “ ”

nbg.co.uk