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Partners Predict Double Digit Sales Growth In 2017; Big Bets On Security, Cloud Services Are Paying Off

Steven Burke

Solution providers attending the recent XChange Solution Provider 2017 conference said they expect big bets on security and cloud services to pay off in double-digit sales growth this year.

Ken May, the CEO of Swift Chip, a $1.2 million Santa Monica, Calif. MSP serving LA and Ventura County, said he expects 20 percent sales growth this year based in part on the introduction of a new managed security service for clients.

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The managed security service is the culmination of a year of investment in security specializations including GSEC and a certified ethical hacker designation. As part of the security-as-a-service offerings, Swift Chip is set to add security audits and cybersecurity penetration testing.

The new services are targeted at enterprise clients who are looking for third-party security assessments, said May. "These are corollary services that internal IT departments can't do because of conflict of interest," he said. "This is revenue we can go after that we didn’t have access to before."

May sees security services climbing from 15 percent of sales to 40 percent of sales over the next several years. "The perception of security as being necessary has increased in the general population," he said. "It is a much easier sell because of the amount of personal data that is being stolen."

Luis Alvarez, president of Alvarez Technology Group, a $5 million Salinas, Calif. solution provider, said the rapid adoption of cloud services is driving what he expects will be sales growth of 15 to 20 percent this year. "Customers want to migrate off legacy systems as fast as possible," he said. "That is providing a lot of recurring revenue and consulting and project services."

Alvarez Technology Group's fastest growing business is centered on Microsoft Office 365. "The subscription pricing is a no-brainer," said Alvarez.

Alvarez is also investing heavily in IoT solutions with agricultural companies in California using sensors to monitor crops. That includes "smart mulch" in strawberry fields to monitor water utilization.

The biggest danger to potential sales growth is immigration policies and potential border taxes, said Alvarez. "For us, that is a big driver of our world," he said. "If all of a sudden immigration becomes an issue and a lot of folks that pick vegetables go away that will impact the clients that we serve in agriculture."

Matt Tyler, director of emerging technology internet of things for Wachter, Mount Laurel, New Jersey, said he expects the company's highly specialized turnkey power and technology systems for specific vertical markets to continue to deliver double-digit sales growth as it has for the last four years.

Wachter's IoT focus is gaining even more "trust" with its highly specialized customers, said Tyler. "IoT is getting us in front of more and more people in those organizations and it is opening up more budget spend with them," he said.

The Wachter customer base includes healthcare, industrial manufacturing, oil and gas and retail. "Our ability to bring the different technologies across verticals is where we are really seeing success," said Tyler.

Wachter's fastest growing service is its virtual patient observation system – a video camera observation system which is resulting in improved patient care and reducing health care costs. In one case, the virtual patient observation system has reduced the number of patient falls from as many as four a month to zero, said Tyler.

Joe Balsarotti, owner and president of Software To Go, a top solution provider in the St. Louis metropolitan market, said he is expecting significant sales growth in 2017 as a result of what he sees as the economic benefits from the election of President Donald Trump.

Balsarotti said he had seen a sharp spike in sales from his small business customers as a result of President Trump's pro-business policies."I am very optimistic," he said. "It's like a load has been lifted off small businesses. There was a lot of pent-up demand."

The Software To Go owner met with Vice President Mike Pence last month as part of a small business roundtable and thanked the vice president and the president for their support of small businesses. "I told him, 'Mr. Vice President, we actually had our best month ever in December,'" he said. "It was over four times better than the previous December."

Balsarotti said he sees the broad range of small business customers more confident about their future and ready to invest. "They want new machines for more efficiency and several have hired new employees," he said. "The volume of clients doing new projects spiked in December. We weren't prepared for it. I am not sure how long it is going to last, but I am going to ride it as long as I can."

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