Sales slump mars channel road to recovery

Runrate business dried up in April leaving some channel players out of pocket

Marie-Christine Pygott: It looks like things are going to recover

The UK channel’s fragile re­covery was thrown off course in April as runrate business ground to a halt.

The long Easter holidays, disruption caused by the volcano ash and the after-effects of a spending splurge in late March have all been blamed as some resellers and distributors slumped to their worst month in memory.

The set-back was laid bare in an interim management statement from distributor Northamber confirming that UK sales of PCs and IT eq­uipment were “far lower than anticipated” during April.

The severity of the slowdown was confirmed by figures from research house Context, which tracks notebook, desktop and server sales through UK distribution.

In the first week of April, unit sales tumbled by 38 per cent on an annual comparison although they were flat in April’s second week.

Marie-Christine Pygott, senior research analyst at Context, said the channel also had to contend with inventory issues.

“The beginning of April was tough,” she said. “Growth at the end of March was strong and there was quite a bit of channel stuffing going on.”

However, Pygott added that unit sales were beginning to rise by the third week.

Shaune Parsons, managing director of reseller Computer World Wales said April was the worst month he had ever witnessed. “We were fortun­ate that we carried over a lot of business from March, but I imagine a lot of companies really suffered,” he said.

“Last month, we had days when we wondered if it was even worth opening and I was busier yesterday in one day than the whole of last month,” he added.

Ian French, strategic development director of distributor Azlan, said: “April was a hard month because of the school holidays and the fact that it was a short month.

“If you add up the actual selling days in April, there were not very many, particularly when compared with a really strong March.”