TD SYNNEX Reveals Results of Technology Ecosystem Study in Latin America

The security industry is considered to be the sector with the highest revenues and profit margins for the distribution channels of technological solutions in the region.

Flexibility in terms of payments and financing plans is essential for business.
Channels in Latin America will focus on expanding their service offerings.
Forty-seven percent expect annual growth of more than 10%.

According to the Technology Ecosystem Benchmark Report prepared for the first time for TD SYNNEX, distribution channels of technology solutions in Latin America consider that the security solutions sector was the one that brought them the highest revenues (32%) and profit margins (29%) during the last few months. Of the companies surveyed, 47% reported that this year they had a growth of more than 10% compared to the previous year.

«The Technology Ecosystem study conducted for TD SYNNEX shows very clearly how the IT distribution channel in Latin America is seeking transformation to help its customers adopt new technologies that will result in better connectivity, efficiency and security,» said Otavio Lazarini, Senior Vice President, Latin America and the Caribbean at TD SYNNEX.

«As a result of increased interconnectivity in the global technology ecosystem, we are witnessing a rapid and robust digital transformation. Our goal in conducting this study is to provide insight into market trends and highlight opportunities for the IT manufacturing and channel community. We believe this report will help understand the direction enterprises and users are taking to inform investment strategies.» Lazarini concluded.

Conducted in collaboration with technology market analyst firm Canalys, the SYNNEX TD Ecosystem Benchmarking Study underscores that all companies are connected in the global technology ecosystem. The study was developed based on a global survey of technology companies of less than 1,000 people.

In terms of infrastructure, 68% of the distribution channels consider that the area that has represented the greatest revenue for them is Networking solutions. Meanwhile, 29% attributed the highest profit margins to security solutions; this is consistent with the fact that 50% responded that this area is the most demanded by customers, followed by cloud deployment solutions with 34%. Cloud migration will be the solution that channels will be offering the most in the next 24 months to their customers (32%).

Distribution channels surveyed commented that payment flexibility (74%) and credit and financing (62%) will be critical in the coming year to winning business, as well as offering preferential pricing and leasing.

Finally, channels commented that out of 100% of their business, Hardware sales are the most important, representing 40%, followed by the sale of Services 36% and Software 22%.

However, while hardware sales continue to be very important and represent 40% of sales, channels in Latin America are betting on professional services and IT managed services. Channels remain optimistic about hardware sales, although 41% believe that hardware sales may decline. 71% of companies believe that professional services sales will grow significantly in the next three years.

One of the major challenges facing the sector is acquiring the talent needed to drive growth. 59% of respondents cited talent recruitment and retention as one of the top 3 challenges they will be facing in the next 36 months, followed by increased competition and margin pressure (41%).