Mid-market businesses represent around 1% of European businesses overall, but it has been estimated they account for up to a third of the workforce and contribute to at least a trillion Euros to the GDP of the major European economies.
So, how do businesses find the right end point technology as they grapple with the hybrid workplace model? What’s the role of the subscription economy in helping the channel meet the needs of these companies who are neither corporate giants nor small business minnows? Last year, demand for end point devices like smartphones, peripherals, and tablets boomed in Europe. One study from IDC forecasts over 12% year-on-year growth for these devices. So, endpoint looks like a good market for the channel.
It is crucial the channel makes investing in new end point devices affordable and thus more accessible for mid-market businesses. This does mean pivoting from transactional selling to offering the necessary type of Technology-as-a-Service (TaaS). If this is done in the right way, the advantages are substantial, and these businesses could increase the value they are providing to existing and new customers.
Nurturing a long-term relationship
Software resellers have been benefitting from TaaS subscription models for many years already. Yet, for hardware resellers, this is an innovative way to grow their businesses and use a subscription model for packaging up a bundle of end point devices. By paying for this technology as a fixed monthly fee, it is much easier for the end customer to commit to a major outlay of new technology that’s essential to their operation, while providing the reseller with a new source of regular income from the sale.
Hardware resellers could be sceptical about this since some customers may worry about decreasing product value. Yet, a correctly configured TaaS system can simplify the way a customer upgrades their technology overtime. For example, it is possible to lease a new car for a few years and then upgrade to the latest model through extending the lease for another period. For customers, a TaaS model for their endpoint hardware is seen as an operating expenditure, which is more appealing than a capital expenditure.
Technology renewal can also be facilitated by how the TaaS scheme supports the replacement of old products. This includes wiping out all confidential data, recycling gadgets, and minimising the cost of the new technology for the end user. In creating the right financial packages, it helps if manual intervention is limited, and the process is fully automated.
Better cash flow
Hybrid working has become the new normal and highlights the increasing need and demand for computing devices. Certain sectors, such as retail and hospitality, have been heavily impacted by the pandemic, which means that their finances are more stressed than before. Likewise, the public and education sectors may not be able to continuously spend on the newest endpoint gadgets with tight IT budgets. That said, the channel can overcome these challenges and sell to mid-market businesses, resellers are able to create new opportunities via financing packages and flexible funding. There may be concerns over their capabilities to provide these packages to their customers if they do not have the experience. However, to overcome this, the TaaS solution allows access to a variety of financing options to fund investments in new and affordable devices.
The TaaS model has proven to be beneficial to software and hardware resellers and customers of all sizes. Resellers can create long-term relationships with their customers and automate processes for ease of use. At the same time, customers receive the latest end point devices at a cheaper cost, and do not need to be concerned about the disposal of used products. The TaaS model allows for easier customer management and supports resellers with providing their customers with an inexpensive way to obtain the latest hardware.
Article submitted by Dirk De Wolf, Director Customer Solutions Services Europe at TD SYNNEX
