Solution Providers, Inc

For more than a month now, the entire team of DQ Channels was furiously
trying to get data from the country's leading distribution and solution
providing houses about their revenues for 2007-08 and their performance in the
past fiscal. This was followed by a good deal of number crunching to figure out
the guys who can make it to the August Silver Club.

Within the pages of this issue of DQ Channels you will find the fruits of our
fervent work-the ninth Silver Club. These are the country's leading distributors
and solution providers (SP), who managed to grow their business well over those
of their numerous peers.

While putting together the data from various companies, the one fact that
became evident was the number of distributors who posted a negative growth-two
in the Top 25 Distributors list and one in the Next 25 Club.

Compared to this, there were no negative turnover rates in the Silver Club of
SPs. In fact, almost 80 percent registered a double-digit growth. There were
only two SPs in the Next 25 Club who posted negative growth of which one has
recently been acquired by a US-based organization.

Vinita Bhatia

Also, most of the SPs who saw a slowdown in their topline growth stated that
their bottomlines have held rock steady or even grown. This was because most of
them have moved on from the plug and play mode of solution providing to offering
specific business solutions.

One SP even shared that though his company's topline grew by a dismal four
percent, his bottomline profits went up by 20 percent. And a good deal of this
came through offering managed services. And he is content, let topline be
damned.

This reaffirms what we have been maintaining-that growth is in the solutions
business and not in trading anymore. In fact, in the course of my interactions
with leading distributors recently, I saw that most of them are thinking long
and hard on means and ways of adding more value to their box pushing business.
Some have opted to adding enterprise level products to their portfolio while
others have set-up service divisions.

Nonetheless the writing is clear on the wall-if you want to survive and grow
in this business then focus on solutions and services.

Vinita Bhatia

vinitavs@cybermedia.co.in