News in the Channel - November 2022


Tales of the unexpected

It has been another year of unexpected events impacting on the channel, but, as usual, businesses have shown their resilience.

When 2022 dawned, many people in the channel were hoping for a quieter year than the previous two. As the social restrictions imposed by COVID started to ease in the first quarter, there were hopes that trading could get back to something like normal – or maybe even a ‘new normal’. But if 2020 and 2021 taught us anything, it is to expect the unexpected – and few people saw a war in Europe coming. This, along with many other factors, such as component shortages, rising costs

and inflation have made trading conditions more difficult as the year has progressed. That said, as people have returned to the office or adapted to new ways of working, there continue to be many opportunities for businesses in the channel to grow their sales and profits - and in many cases they have been taken. Here, a range of commentators from businesses in the channel offer their perspective on 2022 and how events have affected their company, the channel and their customers. l  Growth of services – distribution must add more value than purely our logistics capability, and more time is being spent on value-added services to create increased value with customers and partners l  The cost of living increase is the big one at the moment, it means people are spending less and the boom of demand during COVID has really tailed off. Our focus is on trying to support our own staff as best we can through these challenging economic times and have recently launched a £250,000 investment for a one-off payment to those in specific salary brackets this winter, to try and support people. The latter has had several impacts, including talent attraction – people are hesitant to move suddenly – cost of materials, USD vs GBP, cost of product, cost of freight, cost of capital, cost of running the business: fundamentally, it has become significantly more expensive to do business even if you are standing still! But nevertheless, I am confident about the future. I’m always confident in the channel – it’s had relevance and endurance, but I think 2023 will be tough and the economic climate certainly indicates that. Ultimately, we will focus on finding ways to be hyper relevant to our customers, supporting their requirements and being as flexible as we can to ensure we are making it easy to do business. Every challenge presents opportunities, and we are well placed to seize those.

Phillip Turner , chief portfolio officer, Exertis It’s been a year of challenge and opportunity: market data shows most markets are stagnant or in decline, and this, coupled with factors such as the Ukraine crisis, Brexit impact, labour shortages,

inflation, post-covid market re-stabilisation and our own government decision-making are driving the cost of living higher and impacting on consumer confidence – it’s not been an easy market to succeed in. But as always, I’m proud of the team for finding opportunity to increase our value to our customers and continue supplying to the service levels we pride ourselves on. I’m sure most people will agree that the market is hard to predict now with so many factors at play; but ultimately, we believe, as always, that technology enables businesses to grow and will always have a relevance in consumer spending, and we are well-placed to support our customers. There have been various trends in this year. For instance, we are seeing a lot more interest in aaS solutions, cloud technologies and our lifecycle management solutions as sustainability continues to be a huge trend in the market, coupled with customers trying to sweat assets harder and reduce their capital expenditure. Elsewhere, the primary influences on the channel have been: l  Labour supply challenges – be that HGV drivers, warehouse staff, among many others, as a result of Brexit l  Consolidation – manufacturers, customers or our competitors

Philiip Turner Exertis


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