IT market set for brief recovery

Slight improvement in channel sales, according to Global Touch report

Channel sales in Europe have improved slightly, but this may not continue to the end of the quarter, according to the latest Channel Tracker report from analyst Global Touch.

The report, which was compiled half way through the second quarter of this year, found the number of resellers expecting sales to meet or exceed expectations had increased to 53 per cent, compared with 49 per cent at the same point in the previous quarter.

But Denise Sangster, chief executive of Global Touch, said the results have a lot to do with the end of hostilities in Iraq, and the quarter is likely to end weakly.

"There has been a slight recovery in sales, but I don't think it will continue in Europe because the French and German economies are not strong enough," she said. "Additionally, the UK has just come out of its strongest period and is going into its weakest."

One in five European resellers predicted that sales in the second quarter of this year would improve compared with the same period last year, while 19 per cent expected a drop.

The majority, 61 per cent, said they expected no change. Sangster said resellers are changing their business models and have evolved to fit a new market.

"There is no question that [resellers] are working better and those that have integrated products, services and financing packages will win in the corporate space," she said.

Des Lekerman, managing director of reseller Eurodata Systems, said resellers that are prospering are the ones concentrating on specific market areas.

"Resellers that are focused on core areas are winning business. Those trying to be everything to everybody are not because customers can see through it," he said.