What Economic Slowdown? Let me see: .0001 x $200 billion is ...oh my gosh... $20 million

Pd: the following retrieved today from What Economic Slowdown?By Lawrence WalshNovember 6, 2007 at http://www.baselinemag.com/article2/0,1540,2212280,00.asp?kc=CIOMINEPNL110607

Top 20 SMB Technologies and Purchasing Trends
November 2, 2007 By Lawrence Walsh
Quick Reference: SMB IT Spending Trends

Small and midsized businesses in the United States spent $200 billion on technology, with the lion's share going to support and integration services, computing platforms and Internet access, as these organizations increasingly look to technology to help fuel their growth and increase productivity.


According to a new SMB IT spending survey conducted by CompTIA and AMI-Partners, SMBs are being deterred by economic downturns caused by rising energy costs and the subprime mortgage woes. Rather, they're looking at significant expansion. Nearly two-thirds plan to add between 1 and 5 employees in the coming year, and one-quarter will add more than six employees.

Staffing plans are spurred by a rather optimistic outlook for revenue performance in 2008. Nearly half (45 percent) are forecasting revenue growth of 10 percent or better; while one-fifth say their revenues will grow 20 percent or more.

Fueling growth, in part, is investments in new technologies and upgrades to existing infrastructure. According to the survey, SMBs are heavily invested in key technologies that were once previously reserved for enterprises or have plans to invest in new, advanced technologies.

The following are the top technologies that SMBs have either deployed or plan to purchase in the next 12 months:

1. Desktop PCs 98%
2. Laptops/Notebooks 93%
3. Productivity Software Suites 90%
4. Firewalls 79%
5. Single-function Laser Printers 76%
6. Accounting/Tax Software 69%
7. LAN-based Servers 67%
8. Fax Machines 67%
9. Routers and Switches 65%
10. Color Multifunction Printers 64%
11. Full-function Copiers 59%
12. Desktop Publishing Software 57%
13. Color Laser Printers 57%
14. Remote Access/VPN 49%
15. VPNs 47%
16. Secure Backup/Disaster Recovery 47%
17. Time Management Software 47%
18. Wireless/Wi-Fi LAN 44%
19. Word Processing software 39%
20. Spreadsheet Software 37%


According to the survey, 64 percent of SMBs characterize themselves as "value adopters," or companies that will wait until technology is proven before purchasing it but not waiting so long that they become laggards.

The survey found several technologies previously reserved for the enterprise are gaining traction in the SMB market. These technologies include:

1. Custom Software 31%
2. Web Services and applications 28%
3. CRM/Sales Force Automation 23%
4. Software as a service (SaaS) 20%
5. IP Telephony 19%
6. Storage Area Networks 19%
7. ERP/Supply Chain Software 18%
8. Open Source/Linux Applications 18%


While SMBs see technology as a means for growing their businesses and gaining operational efficiencies, they are also challenged by management and maintenance costs, scalability and integration issues. Pervasive among the more than 700 survey participants is the need for value; most are willing to pay for the technologies they need so long as they can justify and contain the total cost of ownership.

Brand leadership and brand loyalty play little difference in purchasing decisions, while competitive pricing ranked among their chief purchasing criteria. Competitive pricing is also the area where SMBs say vendors need the most improvement. This shows SMBs will go with technology providers that deliver the best value for their businesses.

NEXT: SMB Spending

SMB IT spending in 2007

Small and midsized businesses spent nearly $195 billion on IT goods and services in 2007. The following is a breakdown of their spending:

IT services $72 billion
Computing $51 billion
Internet $27 billion
Software $24 billion
Storage $11 billion
Security $7 billion
Networking $3 billion
Total $195 billion


Small and mid-size companies spent an average of $78,400 in 2007 on IT goods and services, and plan to spend upward of $81,400 in 2008.

NEXT: Key IT Business Challenges

Key Business IT Challenges

Controlling IT spending and maintenance costs, as well as leveraging IT to increase productivity are SMBs' chief IT challenges, the survey show.

Controlling IT spending 37%
High IT maintenance costs 26%
Using IT to increase user productivity 23%
Extending life of legacy systems 20%
Integration issues 18%
Finding vendors that understand business 15%
Leveraging IT to enhance customer service 14%
Upgrading to Vista 14%
Finding and retaining IT talent 12%


NEXT: Top SMB IT Purchasing Criteria

Top SMB IT Purchasing Criteria

According to the survey, the total cost and long-term value (scalability and integration) are the chief criteria for purchasing IT products and services.

Total Cost of Ownership 76%
Scalability 69%
Future Integration Capabilities 64%
Brand Leadership 57%
Vertical Expertise of vendors 55%
Price 44%
Stability (mature technology) 42%
Brand Loyalty 40%
Vendor Recommendations 34%


NEXT: Top SMB IT Purchasing Criteria by Vertical

Top SMB IT Purchasing Criteria by Vertical

The following are the IT purchasing considerations by vertical industry.

Manufacturing
Product realiability 87%
Total Cost of Ownership 65%
Scalability 59%
Finance & Insurance
Vendor Understands Business 83%
Total Cost of Ownership 78%
Scalability 67%
Health Care
Product reliability 84%
Total Cost of Ownership 60%
Integration Capabilities 59%
Government
Total cost of ownership 55%
Integration capabilities 52%
Brand loyalty 50%
All Other Verticals
Product reliability 76%
Total cost of ownership 66%
Scalability 64%


NEXT: SMBs Criteria for Selecting Vendors

SMBs Criteria for Selecting Vendors

The following is how SMBs rank the criteria for selecting technology vendors and how they rate those vendors on meeting these criteria.

Selecting vendors Selection Criteria Improvement Needed
Competitive pricing 94% 67%
Delivers as promised 91% 47%
Quality installation 87% 48%
Knowledgeable personnel 81% 48%
Post-sales support 79% 47%
Scalable products 78% 42%
Understands SMB needs 74% 49%
Pricing flexibility 68% 45%
Offers variety of solutions 64% 37%
Offers variety of solutions 64% 37%
Custom solutions 63% 41%
Proactive support 59% 38%
Provides training 57% 35%
Known brand/market leader 56% n/a
Recommended by colleagues 53% n/a


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