The system builder community represents a dynamic and diverse channel with strong IT purchasing influence over the home/consumer, small business, mid-tier and enterprise markets. Yet, unlike auto makers, software vendors and traditional desktop OEMs, there is no “”big three”” among the system builders

that dominate all categories and market served.

In fact, the top three system builders represent less than one quarter of all “”white box”” system sales. As such, this community provides a unique and extensive channel for reaching a wide range of market and segments – from gamers at home to office workers in the enterprise.

There are significant differences in market focus between smaller system builders and the largest. Larger builders have a greater reach into the middle market and enterprise, while the smaller builders have surprising strength among consumers. Likewise, the survey uncovers significant differences among the vertical markets served by large and small builders.

Home

The level of system builder sales to home consumer was one of the most surprising finding to come from the survey. It has long been assumed that home consumers bought primarily from retailers and warehouses, but the survey indicates that system builders are a strong sales channel into the home. While the largest percentage of sales went to small business, home consumers ranked second for sales volume, dominated by smaller builders.

It was no surprise then, that respondents indicated they felt the strongest competitive pressure from direct sellers.

Small Business and Mid-Market

The largest market served is small business, which is the Holy Grail for projected IT sales growth according to analysts. No group has taken this message to heart more than the savvy system builder market. They survey numbers show that small business is the dominant strategic market served by system builders, representing nearly half of overall system builders’ 2002 sales. Among larger system builders, the mid-market segment accounted for nearly one-quarter of all sales.

Vertical Markets

In the enterprise market, system builders reach every imaginable vertical segment. Among the top five vertical markets, nearly half of the system builders responded that at least ten per cent of their income came from retail and nearly a third from education.

There was a decided variation to these verticals among large and small system builders, with nearly two-thirds of larger system builders making education their top vertical and pushing retail to the fifth position. Interestingly, in a near swap, smaller system builders gave the top spot to retail, pushing education to the fourth position.

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