PCR Tech and IT retail, distribution and vendor news
Smaller PC retailers are targeting businesses to better compete with etailers, only to find their bigger rivals already have a foot in that space.
While the Amazons of the world can’t really compete with a local independent IT dealer in terms of offering bespoke services, repairs and system building, it’s not stopping them from trying to beat them in the B2B space.
The likes of Ebuyer, PC World and Maplin already have specific websites or catalogues for business customers, while in the past month both Amazon and John Lewis have outlined ambitious plans to ramp up their activities in this sector.
“Business customers are key to Ebuyer’s growth plans,” Ebuyer’s head of B2B sales Phil Bates tells PCR. “Their average spend is higher than consumers so their cost to manage – and therefore profitability – is significantly higher. Currently, our business customers account for approximately 50 per cent of our revenue; much of our B2B growth comes from consumers entering the workplace and realising their current IT provider is more expensive and more difficult to deal with than Ebuyer.”
Bates also revealed that Ebuyer has added a team of business solutions specialists, and conducts regular training in the general sales team to keep their knowledge up to date. It also has its own delivery vehicles so it can ship same-day ‘mission critical’ items to customers.
Comparatively, Amazon Business is a new marketplace on Amazon.com (which has not yet launched in the UK) that aims to give sellers “the opportunity to grow their sales by reaching millions of business customers”. However, this could also be an opportunity, as it gives PC dealers the chance to sell their products and services on there as a third-party.
Sellers can list their offers in more than 45 business-specific categories, including office, IT and more. Benefits include quantity discounts, fulfillment by Amazon and ‘Tax Exemption’. Yes, you read that right: “The Amazon Tax-Exemption Program allows customers to make tax-exempt purchases from participating sellers by providing a tax-exemption certificate – and automates the process for participating sellers to accept tax-exemption certificates from customers.”
The B2B arm of John Lewis has also been rebranded as part of a renewed focus on this sector. John Lewis for Business allows trade customers to purchase tech/PC goods and electrical appliances at ‘discounted trade prices’, as well as furniture, cookware and tableware from the retailer’s’ product range.
Katie Papakonstantinou, head of John Lewis for business, said: ‘We’re seeing clients using John Lewis for Business to give offices, commercial spaces and residential properties a design-led look and feel. The comprehensive offering from John Lewis for Business is fast becoming a strong presence in the trade market.”
Having spoken to more than 100 independent retailers over the past few months, it’s clear to PCR that many store owners (who previously only focused on B2C sales) are now going after SMBs and the public sector, with managed IT and cloud services firmly on the agenda.
Adam Gay, Tech Data’s retail director, comments: “The consumer space is a real challenge, margins are squeezed and it’s difficult, so many retailers are now selling into businesses one way or another. There’s crossover now [between retailers and resellers]. To retailers, they have got a big scale in terms of what they can buy, so sales will be strong.
"And if you look at the retail landscape today, probably a big percentage of Staples’ business will be selling into SMBs, then they’ve got their catalogue and online arm. It’s not a bad thing to branch out to areas where there is potentially more margin.”
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