XChange 2012: SMB Spending Sluggish, Partners Should Focus On Short-Term Opportunities

Printer-friendly version Email this CRN article

Solution providers that sell to small and midsized businesses have a hard truth to face: SMB spending on technology is slowing in almost all major categories, and despite the forthcoming release of Windows 8 and the market obsession with tablets and mobility, the bulk of that spending is still tied to infrastructure.

That's according to technology spending researcher The NPD Group, which in a Tuesday session at XChange 2012 in Dallas urged solution providers to catch SMB spending opportunities as they happen. Focus on short-term gains, because long-term, SMBs just aren't planning to spend that much on IT upgrades, said Stephen Baker, NPD vice president, industry analysis.

For its SMB trend reporting, NPD analyzes sales data provided by direct market resellers, e-tailers, national integrators, distributors and other sources of high-volume tech product sales to SMB customers. The first half of 2012 reveals a very weak spending climate in the segment, and that sales growth by product category shows no one category posting significant volume gains since 2011.


[Related: CRN's Exclusive Coverage Of XChange 2012]

Customers are favoring infrastructure spending -- when they're spending at all, Baker said. The industry's trend toward cloud computing as a consumption model and other trends such as big data are putting the dollars toward networking and storage technologies in particular and away from client segments, even with Windows 8 on the horizon. Tablets are making some headway, but NPD found no alternative rising up to challenge Apple's iPad dominance.

Specific to networking, legacy hardware sales are slowing, and wireless equipment is the lone bright spot. Among all infrastructure categories, storage appliances -- especially network-attached storage (NAS) -- seems to be growing most favorably with SMB customers right now, Baker explained.

Notebook sales are downright ugly -- declined from positive numbers in 2011 to what Baker described as "pretty significant negative numbers this year."

"The small bit of good news is that we continue to see ASP [average selling price] stabilized or actually increasing," Baker said, adding that NPD does not expect Windows 8 to deliver a boost to business sales in the fourth quarter.

NEXT: SMB Spending On Networking And Storage

Printer-friendly version Email this CRN article