Vendors will need to step in to provide finance for SMEs ascredit becomes harder to get hold of for smaller companies.
That assessment has come from analyst house Ovum, whichbelieves that there is an opportunity for vendors to fill a gap left as sometraditional sources of finance dry up.
Describing the situation from a software vendor point ofview, David Mitchell, senior vice president of IT research at Ovum, said that moreaction was required to unblock customer orders.
“The economic climate is making customers more reluctantthan before to have large up-front expenditure on new software and hardware,”he said.
“Software vendors must make significant changes to theirsales tactics. Rather than focusing on selling based on return on investment,they must move their focus to the impact on time to break even and cash flowfor their clients. Sales staff must refresh their skills in finance-basedselling,” he added.
Towards the end of last year there was a concerted push bysome of the largest vendors in the industry to promote their financialofferings to the channel, including Cisco, Microsoft and Hewlett-Packard.
One source said that the level of uninsured credit floatingaround the channel was becoming dangerously high and there was a requirementfor those with sound financials to get involved with supporting the market.