Peripherals are rarely margin-friendly. Except for that brief period of a product's initial acceptance to the mainstream, margins on peripherals have even less shelf life than most of today's pop acts - here today, gone by teatime. They are, after all, generally low-cost products that compete on price in a crowded market.
Thankfully there are still a few lucrative products out there, such as flat-panel monitors, which generate about 10 per cent margin despite plummeting prices. Like everything else, however, this will not last, and now is the time to be scouting for new offerings.
As with any other successful business move, the trick is to latch onto something before it peaks. Right now, the clever money is being placed on external hard disk drives. And with good reason.
As technologies go, external hard drives are hardly earth-shatteringly exciting, but that is not stopping them being sold in their tens of thousands every month. SMEs and consumers have taken them to their hearts and wallets, turning an unexciting prospect into a little goldmine.
Just look at the headlong dash by hard-drive manufacturers and removable-storage specialists, all attempting to secure a share in a marketplace that, until last year, did not exist.
Removable storage has become big business. From Flash-based cards and USB plug 'n' store devices to external Zip and CR-RW/DVD-R drives, people have developed an unquenchable thirst for more storage.
The rise of digital cameras, camcorders and multimedia entertainment has helped spark a storage boom.
In the case of the PC, Zip drives and recordable CD and DVD discs have been the main form of removable storage. More recently, small, finger-sized plug-in USB devices have been emerging into the marketplace, but even these are very limited in terms of capacity.
When external hard drives first appeared, they were seen as a niche add-on to the PC's peripheral armoury.
In the latter half of 2003, though, they became the greatest single threat to most other external storage devices. Manufacturers of external drives no longer see them as just another storage device to sit alongside the Iomega Zip drive, for example.
They see them as a Zip drive killer. Even Iomega has recognised the threat, launching its own external hard drive - a tough call for a company that traditionally made its money from flogging Zip disks, but one based on survival, not pride.
For many consumers, external drives are the easiest way to extend the life of their PCs. They don't require any mucking about in the machine's sensitive guts, are simple to set up and use, boast some useful features and software and, most of all, are fairly inexpensive. They come in sizes ranging from 60GB to 200GB and use fast USB 2.0 or FireWire interfaces.
This year will see many drives boast eight-in-one card readers, too. More importantly for the channel, SMEs love them and have been using them as cheap data back-up solutions.
This might not be what the manufacturers recommend, but they are not complaining about the money rolling in. External hard drives are fast becoming big business for small businesses.
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