IT distributors see upturn in business
The Irish IT distribution market could be bracing itself for closures and takeovers, according to senior figures in the business.
“I expect some firms to leave the market and some acquisitions,” said Maurice Cohen, managing director of Midia.” Midia has been looking to make an acquisition for nearly two years, yet it has not happened. I believe that it is more likely the British distributors will leave quicker.”
That view is partly shared by John Dunne, managing director of Sharptext.
“There is some resilience around the IT business,” said Dunne.” You are certainly seeing very few new entrants coming into the market, but you are not seeing a huge amount of people leaving either. A few smaller companies have closed, but none of the major resellers have shut down.”
Another senior manager said that large hardware orders were down among distributors.
“Any hardware vendor will tell you that their numbers are down 25-30 per cent,” said David Dunne, sales manager for Westcoast.
“People are just not in buying mode. We will see whether remaining budgets will be spent towards the end of the year, but the summer has been very difficult.”
But there were some bright prospects in the economic pipeline, said Michael O’Hara, managing director of Data Solutions.
“We are starting to see some bigger projects coming in for quotes,” he said. “That is a good early indicator that people are starting to come to terms with their positions.”
O’Hara said once the economy started to pick up, organisations holding back on IT expenditure would release the purse-strings. “The dam is building up,” he said.
“Companies’ IT set-ups are getting older, and if they do not refresh their hardware this year, then they are more likely to have to do it next year. The confidence just has to come back.”
