NASBA reports irks system builder

A buoyant survey of system builders has been denounced by a Canadian white box manufacturer, who says the respondents are dreaming to believe significant sales are coming this year

“”The report bothers me,”” says Stewart Heyak, president of Winnipeg’s Forest Computers, of the study of members

of the North American System Builders Association (NASBA).

About 560 companies replied to the survey, which was sent to the association’s 7,000 members in Canada and the United States. They project sales volume increases this year of 866 per cent in network or Internet appliances, 384 per cent in notebooks, 379 per cent in handhelds and 1,500 per cent in the new tablet computers.

“”I’ve been hearing this every three months for the last three years – the market’s going to come back,'”” scoffs Heyak.

“”It’s not coming back. Reality has to set in at some point. We have to sit back and say we’re never going to be like we were before. It’s never going to be as easy as it was before.””

As if to underscore his opinion, the report was released on the same day as Gateway Inc. began layoffs and store closings.

But Jim Niekamp, NASBA’s vice-president of business services, defended his members’ optimism. Sales of servers and notebooks are doing well, he said. Small and medium businesses – which make up 55 per cent of system builder customers – drive sales coming out of economic downturns, he added.

When it was suggested North American economic figures don’t show the economies coming out of trouble, Niekamp replied that system builders know customers haven’t updated their computer equipment in a while, a situation that will fuel demand.

The purpose of the survey, he said, is to show information technology vendors that system builders are a vital way to sell to small and medium businesses and caution them against going direct.

To do so it asked respondents what markets they sell into, the verticals they target, services they provide, their core competencies, applications customers want and projected challenges.

Respondents said on average 45 per cent of their business goes to small firms, and 11 per cent to mid-sized ones.

Surprisingly, Niekamp admitted, the study also shows 37 per cent of system builders’ sales go to the consumer market.

Target verticals run from retail (45 per cent) to education, healthcare, manufacturing and local government.

System builders believe technical custom configuration and installation is their top value-added service and that technical know-how is their top competitive advantage.

The report “”spells out to the vendor community there’s a channel already in place that services the small business sector,”” said Niekamp, “”and they need to consider how to work with that channel.””

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Jim Love, Chief Content Officer, IT World Canada

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Howard Solomon
Howard Solomon
Currently a freelance writer. Former editor of and Computing Canada. An IT journalist since 1997, Howard has written for several of ITWC's sister publications, including Before arriving at ITWC he served as a staff reporter at the Calgary Herald and the Brampton (Ont.) Daily Times.

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