SMB Outlook Still Bright

One of the highlights at Comdex was the number of vendors offering new products to move more aggressively into the SMB space.

Exact Software North America, for example, launched a solution provider recruitment program as part of a drive to propel e-Synergy, its realtime ERP software suite, into the midmarket. The vendor, which had a large booth on the Comdex show floor, released the suite in October.

"The midmarket opportunity is huge," said James Kent, vice president of sales and marketing at Exact Software, a division of Exact Holding NV, a supplier of CRM and accounting solutions based in the Netherlands. "Why go after the big enterprise market? It is saturated."

Exact Software intends to add 30 to 50 new solution providers in the next 15 months, Kent said. The company is looking for solution providers that have both front-office and back-office integration expertise. He said solution providers can get up to speed much faster with e-Synergy than with ERP products from rivals such as SAP and PeopleSoft.

Creo, a Burnaby, British Columbia-based vendor, was at Comdex with version 1.5 of its Six Degrees e-mail management software product. Creo is putting together a program to target independent solution providers, said Lisa Corcoran, channel marketing manager for Creo's Creative Software Group.

Corcoran said the $99 Six Degrees product was designed to help minimize the e-mail and spam glut hampering productivity in the workplace. The product is already being sold by a number of resellers including Software Spectrum, PC Connection and MicroWarehouse, she said.

Steve Raymund, chairman and CEO of distributor Tech Data, said the SMB segment is the sweet spot of the market. "That is the bread and butter of our business,smaller VARs offering solutions to SMB clients," he said.

Anthony Venuto, president of Advanced Micro Computer Specialists, a solution provider in Horsham, Pa., said the solutions put together by his company, acting as the IT arm of small and midsize businesses, carry profit margins of 15 percent to 20 percent vs. 3-point to 5-point margins in the enterprise market. "People are paying for what you know," he said. "These companies trust us to stay up on current technology and new products."