NPD Group Blog » SMBs Looking To Upgrade

SMBs Looking To Upgrade

Tuesday, June 15th, 2010
By Stephen Baker, Vice President, Industry Analysis

A couple of months ago we talked about some distribution and reseller sales statistics which indicated that, at least as we exited 2009 sales growth had begun to pickup in the SMB focused channels that NPD tracks besides retail. As we are now through the first few months of 2010 we have seen this trend continue, in both our Distributor Track and our Commercial Reseller Tracking services. In both, revenue is tracking towards 2008 levels and showing substantial revenue growth over the depressed levels of 2009.

To support these numbers we just released a survey of SMB buyers focused on companies under 1000 employees and found some optimism towards spending there, which is clearly borne out by the POS results. In the survey we dug a little bit deeper and tried to get at what SMBs intend to spend on in 2010 and whether this spending is above where they were in 2009. The results were extremely positive. More than 60 percent of those surveyed are intending to spend money in 2010 on PCs, networking equipment, and servers and 59 percent are planning to spend on storage equipment.

The main reason sited by companies for purchasing was to keep up with technology by upgrading their equipment. Almost 2/3 of purchase intentions were driven by the need to continue to upgrade their equipment. Certainly we have all been paying a lot of attention to the PC upgrade cycle in 2010 as the release of Windows 7 and the revived economy has helped spur interest in the upgrading clients.

Our survey found some interesting data in PC purchasing intentions. As we mentioned in the press release, PCs had the highest intention of being purchased in 2010 as well as the largest segment of companies planning to spend the same, or more, on PCs in 2010 as they did in 2009. Digging deeper we saw that PC upgrade intentions are very different by company size. Almost 80 percent of companies with more than 200 employees planned to spend on PCs as part of a long-term plan to upgrade equipment, a clear sign that Windows 7 is creating interest in larger firms. Conversely, only 65 percent of firms with less than 50 employees intended to upgrade for that reason. But 80 percent of firms of that size said they did intend to spend more, or the same, as last year. Among firms planning to spend less on PCs in 2010, 56 percent said they had replaced equipment last year and a whopping 75 percent of firms with under 50 employees said they replaced last year and would therefore be decreasing their spend this year. The bottom line then appears to be that sales will begin shifting to larger companies in the PC arena in 2010 as some portion of corporate budgets begin to be spent on new client systems.

Share and Enjoy: