Sales Optimism Hits New High

For the second time this year, expectations for near-term IT sales hit their highest level since CRN began collecting data four years ago. The previous high was in February. Solution provider optimism is widespread, with sunny forecasts throughout the industry.

The survey found that almost three out of four solution providers expect sales growth of at least 6 percent in the small-business market, while 59 percent expect the same growth in the enterprise IT space. Both are record highs.

"Customers are finally needing to upgrade," said Lucky Wright, president of Vancouver, Wash.-based system builder and solution provider Right Solutions.

The survey found that in May, overall sales expectations in the channel were 11 percent higher than they were in May 2000. Expectations for sales of both branded and custom-built notebooks were 52 percent above 2000 levels, as the market continues its wide-scale adoption of wireless connectivity in the mobile computing sector. The only segment to see a significant decline in sales optimism was the networking software space. However, not all solution providers are seeing sales increases.

Fred Shokati, president of Efftech International, a San Diego-based system builder and solution provider, said his customers"mostly government IT departments"are experiencing soft spending.

"In the March and April time frame, we heard [business partners] say, 'We're going to be doing this, and this and that,' and we never saw it," Shokati said.

Part of the difference between sales expectations and actual project numbers lies in the gap between planned spending by businesses vs. spending that actually takes place. To help solution providers better assess customer spending plans, CRN is now collecting data on businesses' commitment to carrying out planned changes in spending. The first set of data, on midsize companies, will be published in an upcoming issue.