Services key to VAR giants' future
Morse and Computacenter fall back on services to boost revenues
Channel heavyweights Morse and Computacenter are relying on their services divisions to bolster flagging revenues from their traditional product businesses.
Both companies have seen service revenues climb in recent financial results, despite difficult trading conditions.
Morse's full-year results saw a five per cent increase in professional services turnover. Meanwhile, Computacenter posted six-month results showing a 12 per cent rise in its UK service business.
Overall, Computacenter's profits were £32m for the first six months, compared with £24m for the period a year ago. Morse reported full-year profits, excluding amortisation, charges and goodwill, of £12.5m for the year.
Phil Codling, analyst at market watcher Ovum Holway, said other resellers should take note if they are not to get caught out by changes in spending priorities.
"Computacenter can also be seen as something of a microcosm of the services marketplace today. Managed services and outsourcing remain the place to be. But commoditised areas such as hardware are still shrinking, as customers demand more and more for less and less," he said.
Ron Sandler, chairman of Computacenter, said deals such as the Abbey National and Halifax Bank Of Scotland outsourcing deals helped boost services revenue.
"Computacenter showed an ability to overcome revenue pressures through a strategy of building its higher-margin contracted services base," he said.