The UK's top 40 IT distributors generated nearly £13bn revenues in their latest years, CRN research has found. Here we count down those ranked 40th to 26th...
The triple whammy of Brexit, Covid and component shortages has put IT distribution in the spotlight over the last 15 months.
Both figuratively and literally, the stock of the channel's middle tier has arguably never been higher, with publicly listed distributors around the world outperforming Amazon and Google since the start of the pandemic.
Distributors may be facing renewed questions about their role in the ecosystem, but research by CRN confirms the enduring buoyancy of the sector.
The top 40 UK IT distributors on our radar* generated collective revenues of £12.9bn in their most recent financial years on record, up 7.3 per cent year on year.
All are eager that distribution throws off its traditional reputation of being just 'a van and a bank' or a 'necessary evil', and recasts itself as the hub of a modern IT channel characterised by cloud and as-a-service, peer-to-peer partnerships and marketplaces.
In this first instalment, we count down those ranked 40th to 26th, outlining their areas of focus and catching up with their MDs along the way. View those ranked 25th to 11th here, and those in the top 10 here.
"We recognised that UCaaS would dominate the market"
Specialism: UCaaS and VoIP
Key vendor: Ericsson-LG
HQ: Washington, West Sussex
Founded in 2012 by three former Crane executives, this UCaaS specialist is among a minority of companies in this report to focus on just one vendor in the form of Ericsson-LG, for which it acts as sole UK representative.
Although its revenues dipped four per cent to £8.8m in its year to 30 September 2020 (according to numbers it shared with us), it expects its top line to rebound to hit between £11m and £12m this year.
Quickfire Q&A with MD Tim Brooks
What specialism is your firm known for, and what sets you apart from your peers?
Pragma specialises in delivering the iPECS UCaaS and VoIP solutions from Ericsson-LG, working in close partnership with high-growth resellers. We offer flexible commercial and licencing options to enable our resellers to compete and win with a differentiated solution providing high margins.
What's the biggest misconception about distribution?
Most vendors and distributors seek to appoint as many resellers as they can. We do the opposite. We aim to deliver the maximum possible revenue through the smallest number of resellers.
Do you expect to grow in 2021?
Yes. As a result of strong sales in the UCaaS sector and the launch of our new iPECS One UC and Collaboration service based on WebRTC technology, we expect sales to be up around 30 per cent YoY.
At first glance, the rise of cloud must be pretty devastating for distributors if there is no physical product to ship. How have you adapted?
Pragma started trading as a traditional distribution business in 2012, providing on-premise VoIP solutions. However, we recognised at that time that UCaaS would dominate the market in future and started working then on developing a cloud service model with Ericsson-LG. We were the first country to launch iPECS Cloud in 2016 and this now represents more than 60 per cent of our revenues.
Tell us one thing most people won't know about your company?
Unlike almost every other UCaaS provider, Pragma is channel only, we have never sold any product or service directly to an end user, nor would we.
*Brokers, sub-distributor and others not holding direct contracts with vendors were not considered for this report. We also chose to exclude those specialising in technologies outside CRN's core market. This includes distributors of mobile phones, industrial components, gaming software and office supplies. For the top ten, where possible we have isolated a UK distribution total. But the headline revenue numbers of those further down the list often contain international as well as UK sales. For hybrid reseller-distributors, we have attempted to split out just the distribution number. For hybrid manufacturer-distributors, we chose not to do this. The figures in this report are based on data from Companies House, or figures shared by the company.
Which hardware distributor is predicting 2021 will be a 'year of growth'? Find out on the next page...