The Period Of Shakedown Has Begun

It is that time of the year where every publication will come out with a list
of favorable and not so favorable events that took place since the start of
2007. There will be a lot of analysis and some tongue-in-cheek critique about
what went amiss and what was achieved.

But DQ Channels is doing nothing of the sort. Because we believe that if
there are events that helped shaped the channel throughout the year, then
partners are well aware of it and reminding them months later has no meaning.
And if there were misses, well then there is no point trying to ponder over now,
either.

The reason is simple. Business is booming, the economy is on the upswing and
worrying about the past does not make sense. Instead, there is enough business
out there for everyone, and one just has to go out and get it.

But yes, it is imperative to look into the future and see what it holds in
store. And if you ask me, I think that the period for a general shakedown in the
channel has begun.

Companies that do not have well grounded strategies will find it difficult to
survive in the onslaught of those who are surging ahead with well-charted plans.
Companies with obscure financial grounding as well as improper fund management
policies will also have a tough time. Financial analysts have been warning that
the US is on a brink of a slowdown, and soon, other countries will feel its
repercussions as well.

Very soon, India will witness a consolidation of sorts happening within the
channel community in the country, as players become more organized and business
savvy. This is already imminent with the tie-ups between solution providers
themselves. The many layers of the channel will also see a consolidation and
simplification of sorts, with two or just three levels in existence.

The smarter of the lot will stop looking at topline growth and will instead
concentrate on strengthening their bottomline. If this means that some deals
have to be let go, then so be it.

At the end of the day, gaining a deal but making bare minimum margins on it
is hardly good business sense. In retrospect, if the biggies in the business
turn down a specific deal, then those in the food chain below them will also
approach that project with caution, wondering why the earlier partner chose not
to fulfill it.

Those companies that persist in taking deals and compromising on their
bottomlines might make short-term gains. But in the long run, they will lose out
to their peers. Services will be the buzzword, but it will continue to be a
challenge because of the high attrition rates in trained manpower.

You could call this crystal gazing into the next year. But at the end of the
day, it is nothing but simple application of business sense.

Think about it.

vinita bhatia

vinitavs@cybermedia.co.in