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Another challenge large solution providers face is trying to choose the right solutions to offer customers, Kavanaugh said. For example, a smaller solution provider can more quickly gain a reputation as an expert in vertical markets or certain technology areas, but a big company typically needs to be more diversified, while appearing specialized. World Wide Technology has built specific practices around unified communications, data centers, security and wireless, Kavanaugh said.
"We are fortunate because our [customer base] is diversified too. We are one-third in the federal space, one-third in the commercial space and one-third in the telecom/service providers space. We feel that that's helping," Kavanaugh said.
World Wide Technology, St. Louis, has been growing at roughly 25 percent year over year for the past several years, he said. "We decided to focus more on technology [vendor] partners that we selected several years ago, and go deeper and broader within those programs."
Ingenix Inc., a $1.3 billion solution provider (VARBusiness 500 No. 58), found its niche as a specialist in health care. The Eden Prairie, Minn.-based company focuses on solutions for hospitals down to private practicioners because the health-care industry is more recession-proof than other markets, said A.R. Weiler, vice president of sales.
"Twenty percent of health-care dollars are spent on inefficient processes and overhead. A lot of our business is going to help them operate more efficiently and better serve their customers," Weiler said.
For Insight, the top focus for growing the business is increasing the solution provider's share of market with existing customers. That means trying to win more business, but it also means giving those customers more products and services to buy, said Fennessy.
"When you look at a company's IT spend, how much are they spending on networking, infrastructure, data center? Traditionally, our strategy has always been in the client space: notebooks, desktops," Fennessy said. "But that's only a portion of the IT budget. Growth becomes relevant in other areas of IT spend. For example, networking. That's one of the reasons we bought Calence [a Cisco Systems Inc. solution provider]. You love us for desktops, servers, why not consider us for networking too? As we think of growth, it expands share of wallet with each client. If I'm not getting all the IT spend, how do you do that? You move into other areas, where it becomes a skills discussion. Am I credible? Have I earned the right to have that type of discussion?"
As an example, if a customer defers a desktop upgrade because of tough economic times, the client might still spend on network infrastructure or services, Fennessy said. "You have to keep adding capabilities to get in deep [with customers]," he said.
Of course, deciding to offer a new technology and obtaining that capability are two different things. Like any solution provider, Insight must decide if it should acquire those skills or try to build them organically. Large companies often have the financial means to buy into the market. The best approach is a combination of both, Fennessy said.
"We have to grow organic and be smart about acquisitions. You do it underneath the strategy of becoming more meaningful to each IT client," he added.
Next: Finding Opportunities For Growth
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