Challenges for the IT Channel 2020

Henk Olivier Challenges for the IT Channel

Going into 2020, there are a number of challenges that the

IT channel will have to face and overcome.

This is the word from Henk Olivier, MD of Ozone Information Technology Distribution, who comments: “When it comes to channel distribution in 2020, this year is going to be no better than 2019.

“Many vendors are changing their products to online or cloud solution offerings which means they will need channel partners even less.”

He believes that the only vendors that will still need the channel will be the ones that have specialised products and these will lean more towards the enterprise or medium-sized business.

“If you look at Microsoft, for example, you can buy consumer products directly or through the channel or through a reseller that’s a Microsoft partner.

“When it comes to the enterprise, however, many of the products and licensing solutions are controlled and purchased via the channel. If you want to survive as a channel partner you will need to have products for managed service providers (MSPs). IT companies and enterprise products.”

He urges resellers to sign up with enterprise vendors. “Towards the end of

2019 we had already signed up one new vendor and we’re in the process of signing the second one. Both have enterprise products that are used by larger companies such as those in the financial sector.”

Long-term success will be a result of careful planning now, Olivier adds.

“You need to look for vendors that need a local footprint for sales – the most important aspect of being a channel distributor is to know your products and develop solution- based sales, not product sales.

“There are millions of products out there but businesses want to know what solution they’re being sold. This is the key question.” Channel partners need to know and create localised online systems as well so that their clients can easily purchase the software online, he adds.

“The biggest frustration for resellers at the moment is that when they deal with a channel partner, they need to wait for something as simple as a quote. This all has to be automated through the channel partner system.”

Olivier urges resellers to work on creating an annuity business model with subscription-based software solutions from the channel.

“Also create an MSP business model and provide a full IT solution to the customer on a managed services subscription,”  he adds.

“The reseller cannot focus on just buying and selling products anymore thanks to the move towards subscription-based licensing models.

“These are the only resellers that will survive the future.”

January-February 2020 Futurewave