Public sector spend will not help small resellers
As spending rises SME VARs may find they are missing out on projects, according to analysts
Public sector spending will continue to soar, but the channel could miss out as bigger firms snatch the larger scale projects, according to research.
Analyst firm Ovum found public sector spending rose 13.5 per cent from last year to £7.5bn, with a spend of £10.72bn expected by 2009.
However, despite positive spend predictions smaller VARs could miss out to the larger integrators on large scale projects, such as the potential cash cow of the national ID cards programme.
Eric Woods, government practice director at Ovum, cited large projects as the biggest driver for the rise in spending. “There has been a series of major projects and there are a few more in the pipeline as the public sector looks to build a digital infrastructure.
“The suppliers that can assist the public sector, while meeting its targets, will see growth,” he said.
Woods said there are still business opportunities for smaller players.
“The government is looking to the large firms, but in turn the larger firms are partnering with the innovative and niche players,” he said.
Pete Mistry, technical sales consultant at public sector reseller Eclipse Group, said that public sector spending often bypasses channel players.
“I’m always a bit suspect about public sector spending figures as this usually goes to the big boys.
“We have worked with PC World Business for the NHS and there is some channel benefit, but only if the public sector is willing to talk to the smaller firms,” he said.
Neil French, senior account manager for the public sector at VAR CBC Computer Systems, said: “The public sector is very competitive and it’s hard for smaller VARs to win the business. Most large firms are box-shifting and the value-add reseller is being undercut,” added French.