Blog | March 6, 2013

The SMB Market: A $1 Trillion Secret You Can't Ignore

By Jay McCall

After covering the IT industry for 12+ years, it's rare that I'm surprised by news announcements, industry studies, or other IT events. That said, it does happen, and here's a recent example that I'd like to share. A study by analyst group Gartner projects the SMB market to surpass the $1 trillion mark in IT spending by 2015, representing 44% of the total IT spend worldwide. With so many hot vertical markets (e.g. banking and finance, education, government, healthcare, legal, and retail) out there, this one market accounts for nearly half of all the IT spending!

For those of you reading this that aren't currently selling to the SMB market, below are three recurring themes I've observed in this market, based on my conversations with VARs and MSPs selling into this space. Check them out and consider how your current product and services offerings could be adapted to fit this market.

1. SMBs have many of the same IT needs as enterprises, but smaller budgets. I have to think this is the primary objection some resellers have for avoiding selling to this market because it suggests that you have to lower your profit margins to make them fit this market. That doesn't have to be the case. However, you may need to offer applications and hardware that's geared toward this market. In some cases, your tier-1 vendor partner may have a division focused on the SMB market (e.g. Cisco and Linksys).

2. SMBs lack internal IT resources. When I think about the explosion in managed services, this is the reason that first comes to mind. Through remote monitoring and management (RMM), even a small MSP can serve as the outsourced IT department for dozens of SMB clients, at a cost that's much less than if the SMB had to hire more full-time IT employees.

3. SMBs prefer a one-stop shop. Sometimes referred to as "One throat to choke," this need is very common among SMBs because the business decision makers (often the owner) wear multiple hats and would rather not sign up for working with one solution provider who handles their printers and copiers, another company that handles their phones systems, and another one that handles their workstations and servers. The more of those core IT-related headaches you can alleviate, the more valuable you'll be to this market.

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