New Year channel boost

ARN investigations have revealed the channel has been pleasantly surprised by January sales, which represent a welcome rebound for some after the uncertainty which pervaded late last year.

According to Claudio Antonioli, managing director at integrator SystemCraft, his company had "hit the ground running" in January. He said business had been quite busy with a constant stream of work. "We noticed towards the end of last year that we were doing a reasonable amount of quoting," Antonioli said. He is expecting the flow of work to continue during the next couple of months.

In the enterprise storage channel, there also appears to be no slow-down, with demand for solutions continuing to outstrip the capacity of accredited resellers to deliver them. Offering the perspective of a storage integrator, Ken Wood, marketing and sales director at Enstor, said that for his company January "has been great, both in terms of invoicing and selling. Our market is very healthy and continuing to forge ahead," he continued. "The demand by organisations for increased storage capacity that is manageable and available is not abating."

Wood claimed Enstor's turnover was up 85 per cent year-on-year in January, a figure he said was pretty well in line with what had been forecast.

"We were hoping to do a little bit more but it was still a great start to the year," he said. "We were not affected by any slowdown last year and I see no immediate barriers to our future growth and development.

"Our challenges are more general. We need to manage our business growth and continue to attract and retain the right staff."

Tony Prince, from reseller ComPlus, said this January has been better than last year's.

Prince admits that the beginning of December was "awful" and, as an optimist, he felt January could only improve. He said ComPlus has seen an increase in work from the small business sector this month and also a pick-up in notebook sales.

As for the coming months, Prince feels it's going to "continue to grow for companies [smaller resellers] like us".

Likewise, Kon Kakanis, director of sales and marketing at integrator Sundata, has found it has had a stronger than expected January. Kakanis said, in retrospect, he thinks it's because of the hangover from Y2K, GST and the Olympics. "Things we would normally have expected to happen in November and December were [being carried out] in January and February."

Hugh Evans, CEO of distributor Siltek Asia-Pacific, is yet another channel player buoyant about the start to 2001. He said January went "very well", with revenues that were "above expectations", without being exceptional.

"We were expecting an improvement from December but actually did better than what we had budgeted for," Evans said.

He said he has observed a return to some sanity in the market, with lots of old buyers coming out of the woodwork and some good margins being made on sales.

"We had lots of small orders from a large number of different resellers, but very few large orders," he said. "That is a good sign that confidence is back in the market place and means our margins were good.

"Last year was tough. I would like to think all the problems of the last 12 months are behind us now. I can see clear blue sky and lots of opportunity in the future."

But it hasn't been all beer and skittles for the channel, as Niels Kofahl, director of distributor Tecksel, points out. He said the start of January had been very slow and the company didn't expect to make budget. "All sorts of products are doing badly - it is happening across the world."

Kofahl said he still thought it was the GST, Olympics and falling dollar making an impact, with its retailers telling Tecksel they were doing badly as well.

"We know GST and the BAS statement is causing problems for even our large customers. It is an enormous drain of resources collecting all the information. It is really a very big burden - the Government may be saying that business is coping, but we are doing it hard."

Kofahl added that it was basically a question of consumer confidence needing to be improved. "If they see the economy slowing down they get worried about job security and stop spending. We feel it really needs to [be] fixed at the consumer level - consumer confidence needs a boost."

Nick Verykios, general manager and marketing director of channel services company LAN Systems, also offered a word of caution about too much pessimism. "I refuse to believe that we're the only people doing well at the moment. I think there is a hell of a lot of talk about negative sentiment and, if you keep talking that language, it's going to burn the people who have to make it happen because they're walking around in a false expectation that business is going to be hard."

Verykios said LAN Systems had had a great January, and so had its resellers. Although he admits people have talked about January and December having been a hard couple of months, he asserts that "from chaos comes opportunity. I think what's happening is . . . business is being conducted in a more intelligent manner, so if you're offering anything other than just product you're going to find a hell of a lot of competition at the price level."

* Gerard Norsa and Jeanne-Vida Douglas contributed to this story