Solution Providers: Focus on Finishing 2013 Strong
How you start the year is very important. No argument. But truth be told, it's how you finish that ultimately determines your success. And solution providers are looking to pull out all the stops with a strong ending to the third quarter and are optimistic for the fourth—that is, depending on what the federal government resolves or doesn’t.
According to privately owned brokerage firm Sterne Agee, 73 percent of reseller organizations polled expect to meet or exceed their revenue goals for the third quarter of 2013. Only 21 percent said they expect to be slightly below their goal. Helping fuel the channel’s business, specifically on the storage side, are product refreshes from EMC, Cray, CommVault and F5 Networks, according to Sterne Agee.
The responses are extremely encouraging and show a marked improvement over the second quarter. In fact, 35 percent of resellers surveyed said they exceeded revenue goals in the third quarter, up from 28 percent in the second quarter, according to the report. An additional 38 percent said they met their goal vs. 34 percent in the previous quarter.
It stands to reason that just 21 percent said they came in under target for the third period, which is down considerably from the 31 percent who said they below goal in the second quarter. “We would deem the first two categories as key, suggesting 73 percent meeting or exceeding their goal as a good improvement vs. the June quarter,” noted Sterne Agee in a statement.
Looking ahead, 71 percent of respondents said they expect to see growth in the fourth quarter. The one wild card, however, is whether the federal government will reach an agreement on the budget and debt ceiling soon, as the ability for federal agencies to purchase under the current shutdown is limited. “This could create problems for vendors as there is some spending spillover from this vertical into the December quarter. If the shutdown were to persist much past the Oct. 17 deadline, sector estimates would need to be revised downward,” according to Sterne Agee.
The government situation aside, Sterne Agee sees an uptick for storage and virtualization technologies, as well as network optimization, areas where solution providers are needed most. Network infrastructure products and services—including switches and routers—are continuing to slow in demand, the firm said.
So with fewer than three months left to 2013, where does your business stand? Are you focusing on finishing strong or are you already looking past the holidays into 2014? The year isn’t over until it’s over.