Small Business: If You Seek Profit, Invest In The Channel

When it comes to IT spending, small businesses are known to be on the cheap side. This is the often repeated complaint of IT solution providers. But more than 90 percent of potential customer organizations are small businesses. How to sow a richly profitable relationship with small businesses is a problem few solution providers crack with great success.

But new data and a tool from CDW may help VARs appeal to small customers' focus on profit making to drive IT purchases. Basically, CDW can show that small businesses using IT strategically and relying on experts to handle the details are likelier to have successful businesses. The potential pitfall: The tool will enable CDW to directly market to any business that registers to use it.

The tool puts the user through a brief questionnaire leading to an assessment of how the user's relationship with IT correlates with their likely ability to grow their business. In preparing the tool, CDW interviewed 152 midsize business leaders who grew their firms from a small size.

From these interviews, they determined that small businesses that see technology as a strategic or competitive investment tend to grow faster than their peers: 61 percent of small businesses with that view of technology saw double-digit average annual growth over the past five years, compared to 43 percent of the group that "spent just enough" to ensure employees can do their jobs.

The great news is that more and more small-business IT decision makers are perceiving IT as a strategic, competitive necessity. Exclusive CRN research shows that 51 percent of these decision makers strongly agreed in July 2006 with the statement, "Technology is no longer just a business cost, it is also something that can create a genuine competitive advantage for my company." In October 2006, that percentage grew to 58 percent. In March 2007, it increased yet again, to 62 percent. (These were the only three times this measurement was taken.)

But it's not enough to just believe in the competitive potential of IT. Small-business leaders who rely on others to manage their IT details are likelier to grow their business. According to CDW's research, among owners of the highest-growth small businesses, with more than 20 percent average annual growth, 49 percent had dedicated IT staff at the 100-employee milestone, compared to only 24 percent of all respondents.

To refer your customers or prospects to CDW's free small-business assessment tool, which requires free registration to use, you just need to give them the URL www.cdwconduit.com. Just keep in mind that CDW may use these prospects' registration information to market to them directly.