Partners are engaging in significant changes to their business models to improve their capability to deliver new digitally-focused services that partners today are increasingly demanding.
A new study from accounting, financial, HR, and payroll vendor Sage is focused on the evolving role of technology among channel and reseller partners in the U.S. and Canada. The report, “Small and medium-sized business demand for digital advisory services fuels IT channel”, emphasizes a channel partner shift from being point solutions providers and integrators to becoming strategic advisors for SMBs, unlocking significant growth opportunities, and paving the way for greater digital agility. The report surveyed 2,800 technology channel decision-makers globally, including in the U.S. and Canada, to better understand the key drivers impacting the IT channel and reseller market today.
“This year we focused on key drivers impacting the IT Channel, and how the role of partners has evolved, and the challenges that partners face,” said Sippora Veen, VP of Global Partner Marketing.
Important metrics from the research include that the majority of technology resellers in the U.S. (59%) and Canada (52%) have shifted their focus toward providing strategic advice and services, aiming to improve SMBs’ ability to swiftly adapt to market shifts, new technological breakthroughs and evolving customer demands. In Canada, channel leaders attribute the shift to the need to keep up with shifting customer demands (56%) and building stronger customer relationships (53%).
On the customer side, almost three-quarters of SMBs in the U.S. (73%) and Canada (74%) see investing in digital agility as a high priority, believing it will drive business growth (30). 25% also saw it enhancing competitiveness in the U.S. (25%), and 26% saw it increasing efficiency in Canada (26%). Almost two-thirds of Canadian SMBs (64%) and half of SMBs (51%) in the U.S. are recognized as ‘fairly digitally agile’ by channel leaders. However, only 39% of U.S. and 28% of Canadian partners feel SMBs are adequately prepared for future disruptions.
“We want to understand the current state of channel partners in North America,” Veen said, “We also want partners to help move them into a digitally agile state to address the complexity of technology and integration problems are users. In the US, the problem for partners is often customer resistance to advisory services, while in Canada a common issue is usually limited budget and limited expertise.” In Canada, nearly half of the channel partners (47%) cite the complexity of technology and integration processes as the top hindrance to supporting SMBs’ digital agility journey.
The market is currently undergoing significant change,
“We are seeing a shift in the market,” said Dan Caringi, Partner and Business Platforms Leader, at Toronto-based MNP. “Since COVID, it’s been more about U.S. vendors entering the Canadian space, which has meant a more competitive market.”
“Our competition is driving quick fast implementation-only services to the market, which makes it harder for us to show value,” said Susan Vincent, Managing Director at the Digital Solutions Practice of global partner Baker Tilly. “Sage provides packages which allow us to compete against this.”
“60% of U.S. partners say that we need to offer a broader mix of solutions,” Veen stated.
Partner preferences in Canada are slightly different.
“For vendors it’s not one size fits all,” Caringi said. “We want to be as self-sufficient as possible, mastering our own domains. The decision making process in Canada is also very much by consensus, because Canada is a little less entrepreneurial than the U.S.”
Robert Colelli, Managing Principal, Operations at Commercial Real Estate firm and MNP customer Cresa Toronto emphasized that quick go to market involving both Sage and MNP is critical for them.
“We are very thirsty and time is our scarcest resource, so anything we can do to speed up the business will help us,” he said. “Where there is a need, we find money to do it.”
Caringi said that the end of government support programs will also likely stimulate sales in Canada.
‘We have had free money programs in Canada, which is a lazy approach, but those are now ending,” he stated. “Today customers are willing to put money down if they see value.”
