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How was 2023 for channel partners and their vendors?

With 2023 drawing to a close, it’s time to ask: what kind of year was it for channel businesses? And did 2023 live up to their expectations or did it fall short?

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There are years that people are sad to see go and there are others that they are all too happy to say goodbye to. So, which one was 2023? We asked a few channel partners and vendors to give us their view of the past 12 months.

Mark Forster, CTO at Softcat, can safely be described as one of those who sits in the positive camp – as far as he’s concerned, this was definitely not an annus horribilis for Softcat.

“2023 has been good to Softcat and our customers,” he says. “Our breadth and depth of offering and expertise has meant we have been able to assist our customers across an increasingly converging technology stack.” He adds that while artificial intelligence (AI) will “probably win the award for column inches” as the channel jostles for position and relevance, we have “yet to see the real commercial impact in 2023”.

Forster’s positivity about 2023 is at odds with the perception most people had coming into the year. David Watts, senior vice-president and regional managing director of UK and Ireland at TD Synnex, notes: “I dont think anyone in the channel went into 2023 with high expectations. Inflation and interest rates were rising and economic growth was predicted to be slow.”

Despite the circumstances, however, he adds: “I dont think we have done too bad...by remaining focused on the strategic priorities, and recognising the need to be flexible and take a different approach when required, most channel companies have come through 2023 relatively unscathed.”

Mike Barron, UK managing director at Synaxon, takes a similar view: “Looking back now, it could have been much worse. There was a lot of doom and gloom around in the early part of the year, but during the past few months, I think partners and the channel as a whole have simply knuckled down and got on with it. The UK channel is extremely resilient and has a lot of experience of dealing with the peaks and troughs of the economic cycle.”

He believes that a lot of channel companies and customers have taken the opportunity to reset their sights and priorities to get a better picture of where they want their IT and business to go, leading to “faster and more decisive decision-making” and a “return to growth right across the market”.

Alex Tatham, executive director at Westcoast, describes 2023 as: “A tough year, largely as the boom the industry had benefited from on devices came to a halt with a bump. However, there were plenty of bright spots in the solutions and networking business and a surprisingly strong year in print.”

Nevertheless, he adds: I cant say that 2023 is a year that I will look back on in business with any fondness. But far from being an annus horribilis, we have seen a number of those in the past years in the IT industry – its a year that I returned to my spiritual home, Westcoast, and one that saw expansion geographically in Europe, expansion in technology and has laid the ground for expansion in 2024, with AI among others.”

Matthew Paynter, vendor alliances director for UK and Ireland at Exclusive Networks, echoes Tatham’s sentiments: “2023 has been tough, the economy has been tricky and larger deals have had longer sales cycles. But [the challenges have highlighted] the strength of our channel, the opportunities we create and new approaches we take to unlock business.”

Alan Stewart-Brown, EMEA vice-president at Opengear, says there was a significant slowdown in 2023 in the UK in business growth: “This is due predominantly to the continued political and financial turmoil that took place throughout the year. A complete lack of business confidence and almost zero economic growth in the UK was certainly a major factor in 2023.”

While it was a “good year from a business perspective for Opengear”, 2023 was certainly not without its challenges. But Stewart-Brown is optimistic about the future: “Looking forward, with inflation rates recently starting to fall across Europe, we can only hope that central banks will start to ease base interest rates in the second half of 2024 and that this will have a positive effect on business financing and IT investment, especially in the SME sector. We remain optimistic about our business prospects in 2024.”

Stuart Robson-Frisby, regional vice-president of EMEA channels at Tanium, says: “2023 was never going to be easy, but no one could have predicted the challenges that would unfold from geo-political tensions and economic uncertainty. But [despite the hurdles], the collaboration between vendors and partners has been instrumental in meeting customer demands. This is a noteworthy achievement given the frequent budget constraints.

“It was a year of challenges and opportunities. Im looking forward to 2024. Channel sales have gone up across the industry by 10% year on year, and this will certainly continue. Channel partners have played key roles in the successful launch of several new products and services. Its an exciting time to be a part of this industry.”

As the year comes to a close, it’s an opportunity to appreciate our accomplishments and learn from the challenges we encountered
Greg Jones, Kaseya

Greg Jones, EMEA vice-president of business development at Kaseya, also describes it as a challenging year, adding: “I believe, overall, 2023 has been a great year for many MSPs across the globe. It is easy to focus on the negatives in business, but we work in an exceptional industry. Many MSPs [managed service providers] have struggled with sales, marketing, security and staffing, but they have also unlocked so many opportunities within the industry. It was a great year overall. As the year comes to a close, it’s an opportunity to appreciate our accomplishments and learn from the challenges we encountered.”

Simon Pearce, EMEA and APAC vice-president at Netwrix, is another of those who admits that 2023 was a difficult year: “But as it draws to a close, we are starting to see real growth return to our business. We saw the market move to partners who added more value and were fair, as well as equitable on the margin they took.”

Pearce admits that the company had to work harder and smarter, adding: “I am really looking forward to 2024 because the momentum we have built up in the past 12 months, along with the steady market recovery, makes us feel very confident moving forward. The headwinds in 2023 were real, so I have to say I am glad to see the back of it.”

Rachel Rothwell, senior regional director for UK and Ireland at Zyxel Networks, is one of those who falls in-between the positive and negative camps: “After a really positive 2022, this past year has been a real mixed bag for the channel – its not been fantastic, but it has not been terrible either. Overall, its been just about where we expected it to be.”

Sales have been up and down due to the uncertain economy, she adds: “But the biggest issue has been balancing supply and demand. Im not sure anyone in the channel is going to look back on 2023 as a particularly special year. I think everyone will be hoping for, and expecting, that the year ahead will be much better.”

Paul Flannery, vice-president of international channel sales at Epicor, says the challenges faced in 2023 “only made our partnerships stronger and more agile”. Asked whether he is glad to see the back of 2023, he says: “Were looking forward, not back. As expected, given market conditions, there were challenges. But together with our partners, weve come out all the stronger and built solid foundations to drive into 2024 and beyond.”

James Bradley, vice-president of EMEA partners and alliances at Okta, says there has been a strong focus on generating profitable growth – “both within tech companies and in the channel” in 2023: “[Channel partners] have almost become VIPs within tech businesses. CEOs – ours included – will now make presentations directly to channel partners, to talk about their business, their products and services and where they see opportunities in the industry.”

But it is a two-way street, he adds: “In 2023, far more tech companies brought their channel partners in on the process of product development. Thats because partnership in 2023 is no longer viewed as a separate department – its now a horizontal part of tech businesses and completely integral to everything the industry does.”

It was a year that cemented the role of channel partners. “Successful tech businesses in 2023 no longer ask themselves, ‘How can we sell more stuff through the channel?’, but rather ‘How can we bring our channel partners into everything we do?’  – crucially, that includes developing products and services,” he adds.

Rob Mackle, director and co-founder of Assured Data Protection, is in the more bullish camp: “2023 has been a great year. The awareness of cyber threats has driven demand for our services. Businesses are investing in the very best technologies and service providers, not settling for adequate.”

Partnership in 2023 is no longer viewed as a separate department – it’s now a horizontal part of tech businesses and completely integral to everything the industry does
James Bradley, Okta

But even though 2023 has been “an exceptional and record-breaking year”, Assured Data Protection is “not sad to see it go, as 2024 looks even better. As a company, we are doubling down on investment in our technology that drives our service.”

Joining him is Jon Mellon, president of global sales, marketing and field operations at Blancco: “From a channel perspective, 2023 exceeded our expectations. At Blancco, we transformed our partner programme in 2023 because we recognise the critical role the channel plays as we scale our efforts within the enterprise market. Weve increased partner resources by 200%, with a view to using the channel as a foundation to double our enterprise business by 2025, putting 70% of deals through our partners.”

Chris Waynforth, general manager and vice-president of international business at Expel, says the company had anticipated the shifting economic climate heading into 2023 would have an impact on cyber security spend, adding: “This resulted in consolidated investments and more heavily scrutinised budgets. As the year unfolded, we saw exactly that –pushing security leaders to reprioritise their security investments in the face of tighter budgets.

“[A positive outcome was] an increased focus on collaboration between channel partners and vendors. The consolidation of investments meant vendors and channel partners worked closely to deliver more efficient, streamlined cyber security solutions that show immediate value to businesses.

“As difficult as 2023 has been, its highlighted for vendors and partners alike the opportunities we have to work together and affect change. Ive never been as excited about turning the calendar to a new year, and were looking forward to partnering within the channel to help shift customers to make more strategic, risk-based decisions.”

Charles Damerell, senior director for the UK and Ireland at SolarWinds, recalls 2023 as a year that presented a series of formidable challenges for the channel market in the UK. The global economic slowdown caused many businesses to tighten their purse strings with inevitable consequences for the channel.

“[Despite that] saying goodbye to 2023 is bittersweet,” he says. “The challenges were undeniable – a turbulent global economy, rising costs, and disruptive supply chain issues – making product and services sales an arduous task for some channel partners. However, amidst the adversity, 2023 proved to be a crucible of opportunities for those agile enough to adapt swiftly to the ever-evolving trends and technologies.”

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