While adapting to the New Normal, partners see new revenue streams in B2B, SMB and Government verticals.
January 12, 2021, Mumbai: After going through a roller coaster ride in the COVID-19 hit year of 2020, Indian IT channel is all set to kick start the year 2021 with hope and optimism. Channel partners say that the previous year was instrumental in redefining their business strategies to adapt to the New Normal. According to them the IT hardware business will maintain the growth momentum in 2021 as virtual and contactless engagement gain prominence and segments such as Storage, Server, Networking and Gaming PC (All-in-one) will stimulate the industry growth.
Key Learnings from Corona Crisis
The corona crisis and subsequent nationwide lockdown made several established notions irrelevant and one of those is a physical presence. The rapid adoption of remote working and distance learning has taught us the new way of engagement both formal and informal. In such a scenario, a strong digital footprint is absolute for seamless communication with target customers. Partners have also realised the importance of online presence and hence, creating a company website and social media handles is one of the top priorities of partners in 2021.
“During the pandemic time, we realised the necessity of an online presence to keep our business up and running. This year our priority is to launch a company website and social media handles to promote our business”, Mr. Ankit Dugar, Director of Kolkata based Grapewine Networking Pvt Ltd., adding, “We are also contemplating to list our company on the GEM portal to enter into the B2B business.”
Another key learning was effective and regular communication with customers. Partners focused on strengthening their customer relations to ensure recurrent business. “As not much business was happening in April, May and June, we decided to strengthen our relations with customers so that when the lockdown is lifted, they will first remember us for their requirements”, said Mr. Nichay Gupta, Director of Mumbai based DataForce.
Partners also realised the importance of having a healthy bottom line during the pandemic. Hence, striking a balance between revenue and profit is crucial for the channel business in this year.
Business Roadmap and Growth Plans
Expansion and diversification are the key focus areas of the business roadmap of channel partners. Many partners are exploring to step into the growing PC and Gaming business, whereas some of them are focused on geo-expansion and B2B business.
“Our key strategy will be expanding our reach by offering new Enterprise-level products & solutions and grow our wallet share with our existing clients. Hiring seasoned professionals and training the existing team will also be our priorities this year. We plan to expand our team by 25% and increase revenue by 40% in 2021”, said Mr. Amit Mittal, MD of Shree IT Solutions, Gurugram.
Gaming is another vertical, which witnessed a steady growth during the lockdown. Consumers prefer to buy Gaming desktops and laptops for entertainment as well as for work/learning. The demand for gaming solutions and accessories will continue to grow in 2021, hence, partners are building their capabilities to tap this market. Within gaming PCs, customers are opting for All-in-one desktops, which is currently the rapidly growing category within the PC segment.
“The demand for Gaming products and accessories has increased in 2020, especially, during the initial months of the lockdown. Gaming segment grew exponentially as people relied on online gaming for entertainment. We are increasing our focus on the Gaming hardware and accessories segment in 2021”, said Mr. Tarun Aggarwal, Director of Digit Computer, New Delhi.
Partners also see growth prospects in the SMB vertical where the demand for PC, networking and server/storage solution is huge. Talking about the business roadmap, Mr. Debashis Kunti, CEO of Kolkata based Iserve Solution and Services Pvt Ltd, said, “The demand for desktops and notebooks is huge in the enterprise vertical. Every month we get thousands of inquiries and we look forward to being more active in the B2B space through GEM. We will focus on the government agencies and SMBs in West Bengal. Being a prominent RD, we also plan to support our local partners from WB and Jharkhand to crack the Corporate deals.”
Expectations from Vendors/ NDs
Partners hailed the support received from brands and national distributors during the lockdown. However, this year they expect OEMs and NDs to be more supportive and flexible in terms of price, product availability and credit policies.
“We expect the vendors to give us the same level playing field for all the categories of products to compete with the online channel. The volume and reach of E-Commerce companies are much faster than the conventional channel. Therefore, we need to be given the same level playing field so that our business also grows at the same pace. We also want brands to give us the equal opportunity in terms of price and product exclusivity, which they offer to online channel”, said Mr. Ankit Dugar.
Adding to the point, Mr. Amit Mittal said, “We expect NDs and OEMs to be flexible in term of their credit policy to help us serve more clients. Also, they should ensure the timely delivery of the orders so that we do not miss potential customers.”
Apart from support in terms of price, credit and inventory, partners also voiced out the allocation of marketing budgets. “Vendor management allows us to build a relationship with NDs and service providers that will strengthen both businesses. The process should be properly structured so that it is a win-win for both sides. Secondly, distributor expectation in marketing should be based on a mutually beneficial partnership. We expect both OEMs and NDs to support us with product, market information, training and marketing support, said Mr. Nilesh Shah, Director of Pune based Komal Systems.
Pointing out the serious issue of unavailability of stocks at a local market, Mr. Debashis Kunti said, “Many vendors have the policy of allocating certain SKUs to specific NDs. I think this is a rigid strategy and calls for removal. Such step creates obstacles in the way of partners like us as we are not able to fulfil customers’ requirements due to shortage/unavailability of stocks. Secondly certain NDs block material in some regions and hence, we lose potential business. NDs should have flexibility in terms of inventory stocking in their respective branch warehouse.”
Partners also called out prominent PC brands to fulfil the government norms for local manufacturing so that they can also participate in government tenders through GEM portal.
Support from RP tech India
Partners lauded RP tech India for its value-added support during the lockdown. The company was first to launch the Green zone and Orange zone offers to allow partners kick-start their business. RP tech India also conducted innovative campaigns to promote WFH and LFH solutions. All these efforts helped partners to liquidate their stocks and bring their business on track.
“The support from the RP tech has been fabulous, especially during the lockdown they supported us through various schemes and offers. They should make a single point of contact and help partners to manage buying from any branch at any city so that we can fulfil our multi-city orders”, said Mr. Amit Mittal.
Hailing the RP tech team, Mr. Nilesh Shah said, “RP tech is the best distributor in the IT market and I am working with them for more than 15 years now. They are very flexible and helpful. Even local team and product managers directly work and coordinate with us, which improves confidence and help us to focus more on RP tech product line.”
While appreciating the work culture at RP tech, partners also gave some valuable suggestions to the company. “RP tech India has a very friendly culture and we have very easy access to their senior management, Brands teams and product heads. They always help us to get business done at right time and the right place. However, they should focus more on channel business and give us preference in terms of business and stock allocation”, said Mr. Ankit Dugar.
Another partner, Mr. Debashis Kunti said, “RP tech should increase stick availability in Kolkata and also they should reconsider their existing credit policies.”
“We are a very old and prominent partner of RP tech India and our experience with them has always been excellent. They should conduct regular events for gaming products and target their marketing activities to youngsters who are target buyers of Gaming hardware and accessories, said Mr. Tarun Aggarwal.
2021: Year of Hope
As a business theme of RP tech India this year, 2021 brings new hopes and opportunities for the IT and channel business. Innovation and adaptability will be the success defining factors in this year, hence it would be interesting to see how channel partners leverage the growth opportunities in the New Normal.