David Watts 01732 759725 14 INTERVIEW David Watts is confident about the technology channel’s prospects for the year ahead, despite persistent challenges, reports James Goulding channel businesses are small and quite nimble. Nor should one forget that they provide solutions that their customers need. If a customer is looking to reduce their operating costs, IT is often part of the solution. “The channel did very well during the pandemic because it was able to react to the needs of customers very, very quickly in a way that was often the difference between a business existing or not. When the end customer has to react to a new economic environment, IT might be part of the solution. For example, if you want to change the way your workers work or if you want to close some offices to save costs, your IT systems need to support that.” That is one reason why Tech Data’s enterprise business has bounced back strongly in 2022, after a slow-down during the pandemic when budgets were constrained and enterprise offices were shut, while its endpoint solutions business (PCs, printers, mobile phones, peripherals) has generally declined from its pandemic peaks – albeit by less than the overall market because of Tech Data’s focus on the B2B channel rather than the consumer space were demand has been hardest hit. “A lot of companies spent a great deal of money to enable people to work from home and now they’ve got much needed projects to complete in their offices, which are probably not prepared for hybrid working. A lot of budget has moved to updating the network, updating collaboration devices, which is probably why the enterprise market has been up over the last six months.” Opportunity 1: Hybrid working Watts believes that this will continue to drive growth and present opportunities for Tech Data vendors and customers over the next 12 months. “End user customers are coming back into environments that are not fit for hybrid working, yet that is what most of their employees want. That means a fundamental rethink and a re-spend to make those offices fit for purpose – and not just the offices. Even when you’re in the office you may be spending half your time in a virtual environment because plenty of people you’re dealing with within your own company or other companies will be working from home. That requires different collaboration spaces, IT, microphones, audio; it probably needs a much bigger network, a much more capable network, different security and so on. “Shoring up the hybrid workplace and adapting the hybrid workplace is a massive opportunity and we’re working with partners across those product sets all the time to ensure they can bring those solutions to market.” Plus ca change Hybrid working aside, Watts believes that many of the problems IT is solving today are the same ones it was addressing before the pandemic, which are continuing to drive demand for Tech Data’s advanced solutions. “Security continues to do very well. That was a feature pre-pandemic, and it needs to be again post-pandemic. The feeling generally is that security spend didn’t keep up with general spend during the pandemic, so there is a catch-up on security, and that market was already doing well. Cloud, particularly around the public cloud providers Microsoft, Google, AWS, continues to be very, very strong, double-digit growth for us and the market. And then anything IoT or anything that makes sense of data. Analytics vendors continue to do very well. “What’s interesting is that though we've had a global crisis, those things were all doing really well pre-pandemic. I don’t think the needs that IT addresses have changed particularly. The problems that IT is solving now are the same ones it was tackling three years ago.” Opportunity 2: cloud Watts sees the move from on-premises solutions to cloud as the second really big opportunity for the channel, which it is helping resellers/MSPs to tap into through its Practice Builder programme. “We take our customers on that journey. If they are ready for it, we will assess them moving through it, we help them make their first sales in cloud, for example, or in security or in IoT, when Can you be buoyant and concerned at the same time? You can if you are David Watts, Managing Director UK & Ireland at Tech Data, who shares the concerns everyone has about inflation, the price of fuel and the broader cost of living crisis, but who also presides over a business that continues to outperform the market in key areas and which serves an industry that has proved to be remarkably resilient to past recessions and more recent shocks such as Covid. So, while Watts is concerned about the possible effects of high prices and rising interest rates on businesses that have built their foundations and achieved growth when inflation has been very low or which became highly leveraged, often for very good reasons, when money was cheap, he is also confident that Tech Data customers in the reseller and MSP community will be able to survive a business downturn. “We know from previous recessions that the number of liquidations in the IT channel, or the number of businesses that just stop trading, is tiny in comparison to general business liquidations. One of the reasons for that is the vast majority of Like before but with added ESG
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