October 19, 2018

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CONTEXT data highlights distribution growth

by Stuart Wilson, Thursday 20 September 2018

Adam Simon, global managing director at CONTEXT
Adam Simon, global managing director at CONTEXT

The IT channel has had a strong start to 2018 with a combined first half year-on-year growth rate in distribution of 5.1%, according to CONTEXT, the IT market intelligence company. Resellers in most countries more optimistic about the coming 12 months than they were a year ago. CONTEXT’s ChannelWatch 2018 report is compiled from interviews with a representative sample of over 7,000 resellers to provide key insight into market trends and channel priorities across 14 territories: Australia, New Zealand, Baltics, Czech Republic, France, Germany, Italy, Poland, Portugal, Russia, Slovakia, Spain, Turkey, and the UK.

The ChannelWatch report found that all countries are anticipating growth this year. Some markets have expanded at a rapid double-digit year-on-year growth rate in 2018, including Russia at 21.7% and Portugal at 10.2%.

In total, 63% of resellers are optimistic about business in the next 12 months, with just 10% believing they’ll be worse off and less than a third believing things will stay the same. Only Germany, Poland, Slovakia and the UK are less positive about the next 12 months than when they were polled in 2017. Portugal, Spain, Australia and New Zealand, plus the Baltics were the most optimistic countries.

The number of resellers has also stabilised. After a decline of 3% last year, the year-on-year drop for the latest report was a near negligible 0.3%. The reseller landscape is also a mature market, with nearly half of those companies surveyed more than 15 years old and just 14% less than five years old.

“It is reassuring to see the IT channel as a whole in pretty good health as we head into the second half of 2018,” said Adam Simon, global managing director at CONTEXT. “However, despite the optimism in the market for the coming 12 months, challenges persist: not least in areas like financing, staff recruitment and retention, GDPR compliance and the threat to distribution posed by e-tailers.”

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