What makes a channel SuperStar?
The channel is vital to the document technology industry as it serves the main backbone of small and medium sized customer businesses. As the office equipment market adapts to new market trends such as changing work styles which are more IT-centric, the channel’s portfolio needs to adapt to support “smarter” workplace trends as well as compete with the IT channel. At the same time, we have observed a consolidation of the office equipment channel as customer needs shift to more IT facing technology. All resellers must invest in digital capabilities to offset the perceived threat of declining print volumes and digital conversion.
InfoTrends latest office channel survey, captured the profiles of almost 400 resellers across the US, UK & Germany to understand what makes a successful channel player now and in the future. All resellers were segmented by their reported levels of revenue growth and profit margin and allocated into one of four categories:
- SuperStars – high growth, high margin
- Growth Drivers – lower margin, high growth
- Profit Maximisers – lower growth, high margin
- Falling Stars – low margin, low growth.
Figure: US OE Reseller Segmentation by Revenue vs Profit
The average revenue growth reported by the US resellers was 11.8% and profit margin was 21.4%. Those resellers that achieved “SuperStar” status reported an average growth of 21.8% and profit at 32.8%. But what other attributes make a reseller a “SuperStar”? According to our survey, these resellers tend to be very large in terms of revenue, are most likely to target larger businesses and have a healthy portfolio that spans both traditional print equipment and IT focused services. They are also most likely to be in the business of selling Managed IT services and look to acquire in order to grow business into new geographies and/or new product categories.
If you are interested in hearing more about the different reseller segments and their attributes, you can listen into a recent webinar here or alternatively get in touch with a Keypoint Intelligence representative to learn more about our services.