45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
Who are the UK's top IT distributors, and how do they view the market going into the final four months of 2022?
This three-part feature counts down the 45 largest UK broadliners and VADs on CRN's radar by revenue. See part one here. And part three here. This second part counts down those ranked 30th to 16th*....
30. M2M
Revenue: £37m (+24%)
Specialism: Memory and SSDs
Key vendors: Samsung, Intel, Micron
HQ: London
Counting Intel, Micron, Samsung and Seagate among its vendor chums, this memory and data storage distributor saw revenues swell by nearly a quarter in calendar 2021, according to numbers it shared with us.
Founded in 1998 by Ged Mitchell, the London-based outfit specialises in memory modules, SSDs, hard drives, portable media, optical drives, graphic cards, USB drives and SD cards.
Which £40m-revenue distributor became employee-owned earlier this year? See next page for more...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
29. Target Components
Revenues: £39.8m (+15%)
Staff: 60
Specialism: components
Top vendors: Marvo, piXL, AMD, HP Aruba, Ubiquiti, Intel, Microsoft, DeepCool, Gigabyte, Inno3D
HQ: Castleford, West Yorkshire
This Yorkshire-based components distributor became an employee-owned business in July in a move designed to protect staff from potential takeover approaches. It counts independent retailers and resellers as its core customer base.
A 15 per cent revenue rise to £39.8m in Target's year to 31 March 2021 was more than matched at the bottom line as net profits more than trebled to £967,000.
Q&A with Target Components managing director Michael Lawrence
What's been your biggest business highlight of 2022 so far?
We've become an Employee Owned Trust! The Trust now owns 75 per cent of Target, meaning every single member of the team is now invested in our success.
Do you expect to grow in 2022?
It's unlikely we'll be growing significantly in terms of revenue, however we will have grown in terms of customer base. Traditionally we've been viewed as the distributor that supports the independents, despite always having a varied customer base, but we now have a growing number of accounts across an increasingly diverse spectrum of resellers, from VARs and online resellers to CCTV and network installers thanks, largely, to the ever-increasing product range and brands we offer.
What's the one market trend everyone else is missing?
Small form factor PCs/NUCs - we're in the advantageous position of being able to offer pretty much any PC configuration, in any form factor for pretty much any requirement, thanks to our custom PC builder. We've seen a big increase in the number of Intel NUC and micro-PCs being requested for everything from school classrooms, to signalling controls for HS2.
Have you made any significant vendor signings in the last 12 months?
Definitely - we're now distributor for HP Aruba enterprise networking, MadCatz gaming, Cherry peripherals, Norton Internet security, Prevo accessories and Uniview CCTV and security. Not a bad 12 months!
Which emerging vendor/technology are you tipping for take-off in 2022?
We've seen a big increase in enterprise networking requirements for the likes of Ubiquiti and Aruba, Hewlett Packard's SMB networking brand. We've also seen demand for interactive whiteboards, monitors, small form factor PCs and gaming peripherals spike as schools, colleges and universities refresh their classrooms, training and conferencing facilities with products they know delegates and students engage with.
We've become an Employee Owned Trust...meaning every single member of the team is now invested in our success
Distributor share prices have cooled over the last 12 months. Is that a concern?
Not for us. We're in the best position possible - Paul Cubbage, our previous MD, and Ian Prescott started the company and remain shareholders. They know better than anyone how the market fluctuates and the remainder of Target is owned by the Employee Trust.
How is the chip shortage impacting you, and when will it end?
Like everyone in the channel and any industry that relies on chips, it's been enormously frustrating - when there was demand for GPUs, for example, prices rocketed and eventually we reached the tipping point where consumers were no longer willing to pay over the odds. Resellers know there are shortages and they are, in the main, very understanding, but they are very frustrated. As for predicting the end of it? Who knows? We see reports and hear word from sources in the US and Far East suggesting easing in the next six months. Others suggest at least a year. We're watching the market closely.
What, if any, role does distribution have to play when it comes to sustainability?
Because distribution buys in such large quantities, it can, if it wants, lead the way in sustainability. We can demand less plastic in packaging. We can encourage recycling, repairs and reuse. We can even look for alternatives to transporting goods the thousands of miles they travel to the UK. But there is, currently, a cost to it. We're looking at converting to sustainable packaging and carbon-savings in all our own product ranges but it will take a channel-wide effort to make a real difference.
Which distributor (other than your own company) do you feel has done a good job over the last year?
Looking at the results each distributor submitted for 2020/21 most of our competitors did a great job at serving demand in unprecedented market conditions. Contrary to popular belief, distributors tend to get on pretty well with each other - we're all part of the same ecosystem so if one's experiencing success, it's good news for everyone else.
Which VAD grew by nearly three-quarters last year to break the £40m revenue barrier? Find out on next page...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
28. Distology
Revenue: £40m (+74%)
Staff: 35
Specialism: Cybersecurity
Top vendors: Okta, Auth0, Yubico, LogRhythm, Verkada, Ironscales, Jamf
HQ: Stockport
Having taken on private equity backing from NorthEdge Capital in February 2021, this Stockport-based VAD is primed for international expansion, with Germany among the markets in its sights.
Founded in 2014, Distology saw total revenues hike 74 per cent to £40m in its year to 31 March 2022, with the UK generating £33m of the total (according to unpublished numbers the company shared with us).
Q&A with Distology CEO Hayley Roberts
What's been your biggest business highlight of 2022 so far?
Closing out our year with over 60 per cent top-line growth whilst battling through a tough talent market and transforming our go-to-market proposition.
Do you expect to grow in 2022?
Absolutely! We expect to grow aggressively, both organically and via acquisition (watch this space!). And like I always say, we have so much more to do to add value in the distribution space where we sit.
What's the one market trend everyone else is missing?
Not sure everyone else is missing trends, but we do believe that the broader channel is incredibly slow in recognising the importance of identity and access management (IAM) in enterprise IT security and in the consumer security too. Securing multi-cloud operations is another area that needs much more uniformity of approach too. We have been deepening our work on IAM and continue to build our due diligence in multi-cloud security over the past 12 months, so we can select the best solutions for our partners and their customers.
Have you made any significant vendor signings in the last 12 months?
We've delivered a big transformation to our portfolio which highlights the cybersecurity landscape into three areas of focus, which we call specialisms. We've recently signed vendors as follows:
Workspace security: Jamf, Menlo Security, and Ironscales with more to come.
Multi-cloud security: Auth0 (Okta), Cyolo, ThreatX and Fortanix with more to come.
Which emerging vendor/technology are you tipping for take-off in 2022?
Our whole multi-cloud security portfolio is primed to rocket as all the technologies lower the barrier to entry to key technologies for customers - Auth0 (securing consumer identities and enabling better CX), ThreatX (web app & API security without the need for a team of experts) and Fortanix (data security simplified) while also delivering top draw sales margins to partners.
2022 will have been a successful year if... we see our European expansion grow to include Germany
2022 will have been a successful year for your company if… we see employee satisfaction grow and reach our headcount growth targets, we see our European expansion grow to include Germany, and we achieve our financial targets including growing our channel partner base and doing more with our existing partner base.
Distributor share prices have cooled over the last 12 months. Is that a concern?
Share prices have cooled, but they've cooled across all markets, yet there's been more PE and VC investment in the disti market this year, so it's fair to say that distribution, despite being touted for extinction by the cloud for several years now, is still going strong!
How is the chip shortage impacting you, and when will it end?
In short, minimally. We have one vendor who has one platform option on an appliance, otherwise the rest of the portfolio is software or cloud delivered.
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
It's not a new phenomenon, but acquisition tends to result in the original business being swallowed up and the value lost. This is OK for some hyperscale tech vendors, but there are more and more who are craving specialist distribution like Distology. So, if anything there might be some more bold entrepreneurs who are willing to set up a specialist.
What's been your biggest business mistake?
Mistakes are essential especially for fast growth so fair to say I and we, as a business have made quite a few. I wouldn't say there has been one big mistake but one I recall was when I took on a vendor because I liked and believed in the people more than the tech and the market just wasn't right. By the way, I have also made the reverse mistake so like everything in life, the balance has to be right.
See next page to find out which cloud software specialist ranks 27th in the countdown...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
27. intY, a ScanSource company
Revenue: £40.9m (+39%)
Staff: 100
Specialism: Cloud software
Top vendors: Microsoft and Microsoft-complementary vendors
HQ: Bristol
This Bristol-based cloud software distributor saw revenues rocket 39 per cent to £40.9m in its year to 30 June 2021, according to its latest accounts filed on Companies House.
Counting Microsoft as its key vendor, it also works with Acronis, Barracuda MSP and Bitdefender and boasts additional ‘master agent' relationships with the likes of Zoom, 8x8 and RingCentral. intY is now part of ScanSource after the $3bn-revenue, US-based comms distributor snapped it up in 2019.
Q&A with intY's VP digital distribution, Europe, Marcus Ollenbuttel
What's been your biggest business highlight of 2022 so far?
How during this COVID time our people have grown. We've seen new leaders step up, others take new challenges and opportunities, which has enabled them to flourish in this new norm.
Do you expect to grow in 2022?
Yes, and we are.
What's the one market trend everyone else is missing?
People are key to everything you do. If you care for your people and look out for them, it pays as results in the end.
Have you made any significant vendor signings in the last 12 months?
We are continually looking at our line card around our core areas of modern workplace, cloud computing, and communications and collaboration solutions. In addition, we have doubled down on a few vendors to take more of their solutions to our partners. This, in turn, allows them to take more solutions to their end customers. Plus, we have been working on our different models we offer partners— traditional resale, bill on behalf of, or agency.
What, if any, role does distribution have to play when it comes to sustainability?
Everybody plays a part in sustainability and we're all responsible. As a company we are committed to creating a culture of environmental responsibility throughout our offices.
Not persuading Alex Tatham to work with him was the biggest business mistake of the MD of the next company in our list. Who is it? See following page...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
26. Purdicom
Revenue: £41.5m (+27%)
Staff: 54
Specialism: wireless, networking and security
Key vendors: CommScope, Cambium, Siklu, Watchguard, Certa UPS
HQ: Wantage, Oxfordshire
This Oxfordshire-based wireless distributor smashed its £40m turnover goal in calendar 2021 on the back of 27 per cent growth, with its MD identifying the chip shortage as the only inhibitor to its growth (see below). Its net profits doubled to £5.4m.
The Commscope and WatchGuard partner, which has two sales teams focused respectively on the indoor and outdoor markets, expects to surpass £45m revenue in 2022, according to its strategic report.
Quickfire Q&A with Purdicom MD Hugh Garrod
What's been your biggest business highlight of 2022 so far?
Being asked to join and be a part of the Open Wi-Fi adventure by a well-known social networking company.
Do you expect to grow in 2022?
Yes.
What's the one market trend everyone else is missing?
Open Wi-Fi standard which is new and revolutionary to the market.
Have you made any significant vendor signings in the last 12 months?
Yes, we have signed up to be a Hikvision partner and distribute to our resellers.
We do not see [the chip shortage] ending until mid-2023 at the earliest
Which emerging vendor/technology are you tipping for take-off in 2022?
We are very bullish about IO Networks and their Open Wi-Fi proposition.
2022 will have been a successful year for your company if… we could get hold of the stock required to fulfil our huge back orders.
How is the chip shortage impacting you, and when will it end?
This has had an enormous impact on us all and we do not see it ending until mid-2023 at the earliest.
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
I expect the M&A trend to continue as the larger and medium-sized distributors continue to seek growth which they find difficult to do organically.
What, if any, role does distribution have to play when it comes to sustainability?
Well first it must, as we have done, be measured and then you work on a plan to cut your carbon footprint. This can be done by migrating to electric cars, solar, removing all plastics from products and recycling all carboard. We are also trying to use technology more as we did during Covid 19 instead of face-to-face meetings.
What's been your biggest business mistake?
Not persuading Alex Tatham to come and work here.
The next outfit on our list hails from Denmark. See next page to discover their identity...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
25. EET
UK revenue: £43.9m (+28%)
UK&I staff: 37
Specialism: Spare parts, hardware, surveillance
Top vendors: HP, HPE, Dell, Ubiquiti, Cambium Networks, Raritan, Star Micronics, Honeywell, Sandberg, Evoko.
UK HQ: Uxbridge
Revenues at the UK arm of this pan-European spare parts specialist rebounded back above pre-pandemic levels in calendar 2021, with the top line now "significantly" ahead of 2019 when factoring in the transfer of some business activities to other group companies.
Operating in 24 markets across Europe and carrying over 1,100 brands, the wider group is based in Denmark and turned over €575m last year.
Quickfire Q&A with UK MD Sunil Bouri
What's been your biggest business highlight of 2022 so far?
Great start to the year and celebrating with almost the whole team in person at our summer event, which has previously been difficult due to Covid. The wrecking ball joust, retro games and rodeo sheep (bull was injured) made for a great day!
Do you expect to grow in 2022?
Yes, 15 per cent growth in the first six months so far. However, if we actually factor in the spin-off of our surveillance business to a sister company, we have grown over double this for the same period.
Have you made any significant vendor signings in the last 12 months?
Cambium Networks. More focus from both sides has seen the business more than double YOY. They have a great assortment across enterprise Wi-Fi, switching and wireless broadband, which has allowed us to help customers across many verticals and projects.
Which emerging vendor/technology are you tipping for take-off in 2022?
CipherLab and Newland continue to innovate across retail, warehousing and delivery services with wearables, mobile computers and scan technology. Working with ChargeAmps is seeing us bring commercial and domestic Electrical Vehicle chargers to resellers and installers.
How is the chip shortage impacting you, and when will it end?
The biggest frustration is not being able to give customers clarity
Fair to say that the effects have become more apparent in the last few months and the biggest frustration is not being able to give customers clarity. We are working with many of our manufacturer partners weekly and we can see it is evolving but certainly no immediate end in sight.
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
Technology advances rapidly so we will continue to see growth and further mergers, acquisitions and consolidation which is also driven by customer demands, supply constraints and skills shortages.
What, if any, role does distribution have to play when it comes to sustainability?
We all have a role to play when it comes to sustainability. We are determined to reduce the impact of our activities on the climate and have implemented several initiatives including, planting one tree for every five outbound shipments through our partnership with Ecologi. Currently we have planted 624,956 trees and offset 9,500 tonnes of CO2e.
The next outfit in the countdown hails from picturesque Devon. See next page to discover the £50m player's identity...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
24. Climb Channel Solutions
Revenue: £50m (+6%)
Specialism: Software
Top vendors: Canonical, Corel, Flexera, Intel, ManageEngine, Microsoft, Quest, SmartBear, SolarWinds, TechSmith
Staff: 31
HQ: Ashburton, Devon
Having rebranded last year from Sigma Software Distribution, the UK/EMEA business of this software distributor turned over £50m in 2021, according to numbers it shared with us.
According to its website, US-based Climb boasts total revenues of over $700m. The UK business, which counts Microsoft, Intel and SolarWinds among its vendor chums, is based in picturesque Ashburton, Devon.
Q&A with Climb's VP of distribution, EMEA, Jane Silk
What's been your biggest business highlight of 2022 so far?
The increase in new reseller partners that Climb is now attracting every month.
Do you expect to grow in 2022?
The numbers are very good so far!
Have you made any significant vendor signings in the last 12 months?
We have some key new vendor relationships that we will be announcing over the next month but we are also excited to have been deepening our strategic partnerships with a number of our established vendors who have chosen Climb as the distributor they trust to grow their business through 2022 and beyond.
How is the chip shortage impacting you, and when will it end?
Because of the type of software we focus on, the impact on Climb UK's business has been minimal.
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
I think that we will continue to see some distributors building out their capabilities through specialist acquisitions.
What, if any, role does distribution have to play when it comes to sustainability?
We all have the responsibility to implement more sustainable practices both at home and also at our place of work; distribution can work in tandem with its partners to influence and share ideas.
What's been your biggest business mistake?
Pretty sure I make at least some mistakes every single week, the constant challenge to stay ahead in this industry is what's kept me interested for so long.
Which cybersecurity player claims its numbers are 10 per cent ahead of those in its previous year? See next page....
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
23. e92plus
Revenue: £51.4m (-7%)
Staff: 57
Specialism: Cybersecurity
Top vendors: Forcepoint, Trend Micro, Bitdefender, Cloudflare, Check Point, Ping Identity, Radware, iboss
HQ: Surbiton, Surrey
Covid dented the growth trajectory of this Surrey-based Check Point and Trend Micro distributor in calendar 2020, although its net profits widened from £954,000 to £1.6m even as revenues fell seven per cent to £51.4m.
The cybersecurity specialist was counting on growth in 2021 at the time of its 2020 strategic report, however, and is on course for 10 per cent growth in 2022 according to its CEO (see below).
Q&A with e92plus CEO Mukesh Gupta
What's been your biggest business highlight of 2022 so far?
We're ahead of last year's number by 10 per cent.
Do you expect to grow in 2022?
Yes we do, and ahead of the market rate.
Have you made any significant vendor signings in the last 12 months?
Expanding our partnership with HelpSystems brings huge opportunities - they have incredible potential with very ambitious plans - plus ZeroFox is a very exciting signing in the digital risk protection space and Cofense in phishing and email security.
Which emerging vendor/technology are you tipping for take-off in 2022?
A huge challenge with cybersecurity is the need for technology not to work in isolation - so we're seeing growth in both security platforms that offer a joined-up approach, as well as solutions like API security to help secure inter-connected apps and networks.
How is the chip shortage impacting you, and when will it end?
Not at all - it's mostly about software and cloud for us, that's where we can add real value, it's not just based on shipping tin.
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
It will always continue, but it has demonstrates the value distribution continues to deliver, and while we carry on doing that, M&A will continue.
We're ahead of last year's number by 10 per cent
What, if any, role does distribution have to play when it comes to sustainability?
We have to help drive the change, beyond reducing our own carbon footprint.
What's been your biggest business mistake?
Using cheap lawyers!
Which Microsoft partner grew by over a fifth in its latest year? See next page for the answer...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
22. Vuzion
Revenues: £53.7m (+22%)
UK&I staff: 95 (across Vuzion and Cobweb)
Specialism: SaaS
Key vendors: Microsoft, Mimecast, Acronis, DocuSign, Global Relay
HQ: Fareham, Hampshire
This Microsoft cloud distributor - together with direct-selling parent Cobweb - broke the £50m revenue barrier in its year to 31 March 2022, according to numbers it shared with us.
Holding Microsoft CSP status, the Vuzion brand was launched in 2016 and according to market sources generates around four fifths of the group total. It is counting on 30 per cent growth in its current fiscal 2023, according to its MD (see below).
Q&A with Vuzion MD Michael Frisby
Michael Frisby
What's been your biggest business highlight of 2022 so far?
Passing £50m in billed revenue for FY22 (ended April'22) and passing the £60m run-rate mark. And also delivering a comprehensive wellbeing programme that looks at all elements of employee wellbeing culture from physical and mental health through to charitable activities and learning initiatives
Do you expect to grow in 2022?
Absolutely, we're expecting 30 per cent growth in our current FY
Have you made any significant vendor signings in the last 12 months?
No major signings, small incremental only.
My biggest business mistake? Not moving people "off the bus" quickly enough when I know they are not the right fit
Which emerging vendor/technology are you tipping for take-off in 2022?
As the skills shortage and employment costs continue to rise we expect to see even more demand for managed services as SMBs and corporates struggle to hire talent to run IT and security solutions internally
Distributor share prices have cooled over the last 12 months. Is that a concern?
No, but I believe it will help fuel further M&A activity. Enterprise value will ultimately hold up where distributors are adding value for their vendors and resellers.
How is the chip shortage impacting you, and when will it end?
As a pure-play cloud services provider we have minimal direct impact. The occasional Azure capacity limitation and Teams hardware, but nothing of note.
What, if any, role does distribution have to play when it comes to sustainability?
As a key component of the supply chain for vendors, resellers and customers of IT services, distributors have significant ability to help the entire ecosystem drive towards net-zero by delivering value-add services for resellers that help them achieve their sustainability goals
What's been your biggest business mistake?
Not moving people "off the bus" quickly enough when I know they are not the right fit.
The MD of the next VAD on our list wishes he'd come to the UK sooner. Discover their identity on the following page...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
21. DataSolutions
UK revenue: £54.6m (+55%)
Staff (UK and Ireland): 31
Specialism: Digital workspace, security, networking, cloud
Top vendors: Citrix, Check Point, Lakeside, Login VSI, D3 Security and IGEL
UK HQ: Camberley, Surrey
The UK arm of this Irish Citrix distributor saw revenues rocket 55 per cent to £54.6m in its year to 31 March 2022, according to numbers it shared with us.
Having touched down in the UK in 2016, DataSolutions now claims to regularly transact with around 100 UK IT solutions providers. At a group level, the Dublin-headquartered outfit turned over €98m in its fiscal 2022, CEO Michael O'Hara told us (see below).
Q&A with group managing director Michael O'Hara
What's been your biggest business highlight of 2022 so far?
In June we announced we had hit our 2021-2022 revenue target of £83m (€98m) - making it the most successful year in the 30-year history of the company. In the three years ending in March 2022, we more than doubled turnover, going from £40m for the year to March 2019 to £83m for the year to March 2022. We have done all this as well as significantly reducing our carbon footprint and remain on course to achieve our carbon neutral status this year.
Do you expect to grow in 2022?
Yes, we expect to continue to grow like we have over the last number of years. We reached €100m in revenue in May and expect to continue this growth traction across the rest of 2022.
What's the one market trend everyone else is missing?
Two things that we pride ourselves on - ‘people buy from people' and ‘the power of service'. We know from our customers that the personal service they receive from us is what they love most about DataSolutions.
Have you made any significant vendor signings in the last 12 months?
Cato Networks in Ireland.
Which emerging vendor/technology are you tipping for take-off in 2022?
Orca Security on the agentless cloud security side, and around SOAR and the need to automate, D3 specifically here is interesting. We're also seeing vendors engage their partners on sustainability too, which is fantastic to see. IGEL has impressed us with their commitment especially.
Distributor share prices have cooled over the last 12 months. Is that a concern?
We are in our 32nd year of business and have seen share prices rise and fall over this period as we go through different economic cycles. It does look like we are entering a recessionary period which will pretty much effect every business - not just distribution. I do believe the tech industry is better positioned to withstand a recessionary period than most other industries.
How is the chip shortage impacting you, and when will it end?
The majority of our sales are software based so less impacted by the chip shortage. We would like to think things will start to normalise by the end of the year.
What, if any, role does distribution have to play when it comes to sustainability?
Distribution has a key role to play. Speaking from a DataSolutions point of view, we represent 15 vendors in the UK and Irish markets. For each of them we need to ensure we educate and build the channel and then work with these partners to build awareness and business for the vendors we represent.
This skillset and go to market model, can also be used by distribution to promote / educate resellers, vendors and businesses of the importance of sustainability and the need for everyone to take action. Data Solutions have used this model very effectively to help setup Techies Go Green, a sustainability movement and assist in driving change around this important subject.
Not moving into the UK sooner is something I look back on as a mistake
What's been your biggest business mistake?
Not moving into the UK sooner is something I look back on as a mistake. The UK market is one of the six biggest economies in the world. It's an economy that embraces IT and an early adopter of new technology and a very open economy for business which makes it easier than other markets to enter. We have seen huge success in the UK market over the last six years.
Which IT channel stalwart hit £60m revenue last year? See next page for the answer...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
20. Northamber
Revenue: £60m (+14%)
Specialism: Client hardware, security, printers, AV
Top vendors: 10zig, Aver, Avocor, Brother, Eaton, Eizo, Fujitsu Scanners, Kemp, Lenovo ISG, Sony, Supermicro, Vivitek, WatchGuard, Yealink
Staff: 115
HQ: Chessington, Surrey
This bastion of the UK IT channel logged a solid set of financials for its year to 30 June 2021 as net profit hit £337,000 on revenues that swelled from £52.8m to £60m. Some £3.3m of the growth was generated by February 2020 acquisition AVM, with the remaining £3.9m uplift coming via organic means.
One of the few publicly listed UK distributors, Northamber has continued to grow in its fiscal 2022, with H1 revenues hiking nine per cent to £32.3m. Higher distribution and administration costs, pushed it into the red for the period, however.
Q&A with Northamber MD Alex Phillips
What's been your biggest business highlight of 2022 so far?
We grew out team through lockdown and have continued to do so ever since to enhance the Audio Visual, Solutions and Document Management divisions, to maximise the support we can offer the channel.
Do you expect to grow in 2022?
Yes - our growth plans are exciting as our list of vendors and customers continues to grow. We have the highest ratio of product management, marketing and technical expertise in the industry and have had to expand to additional offices in Basingstoke.
What's the one market trend everyone else is missing?
Convergence of AV and IT is increasingly taking place due to hybrid working; this has long been talked about but with our background and growth areas Northamber has invested in the skills required to help both AV and IT vendors to take full advantage of this trend.
Have you made any significant vendor signings in the last 12 months?
Yes, we are delighted to have signed Lenovo ISG in the IT solutions space. In the AV space we've recently added Yealink to develop our Teams (MTR) and Zoom Rooms proposition.
Acquisition valuations were getting crazy
Which emerging vendor/technology are you tipping for take-off in 2022?
There is huge growth in the unified communications & collaboration (UC&C) space. The addition of Yealink fully complements our vendor portfolio and will allow Northamber AV to take full advantage of this growth area.
Distributor share prices have cooled over the last 12 months. Is that a concern?
No, acquisition valuations were getting crazy. Whilst Northamber is growing organically we are always looking for acquisition opportunities to help drive strategic growth.
How is the chip shortage impacting you, and when will it end?
We have significantly increased our stock holding since the start of Covid and chip shortages to ensure we can try to buffer our partners from some of the exposure issues this causes.
What, if any, role does distribution have to play when it comes to sustainability?
We review the sustainability credentials of our vendors and actively try to reduce our carbon footprint. We have also introduced a number of green initiatives this year such as rolling out a large solar panel install as a pilot scheme in our Swindon warehouse, trialling electric vehicles and reviewing packaging materials to move to paper tape and more recycled materials.
Which £60m-revenue cloud software distributor grew by a quarter in its latest year? See next page for answer...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
19. Giacom
Revenue (pro-rata): £61m (+25%)
Staff: 72
Specialism: Cloud software
Top vendors: Microsoft, Acronis, Bitdefender, Sophos
HQ: Hull
Part of Daisy spin-off DWS Group since November 2020, Giacom bills its Cloud Market as "the UK's largest independent cloud portal".
Giacom's revenues in a truncated eight-month financial period ending 31 March 2021 hit £40.7m, a number we have annualised in the headline of this profile. That compares with its £48.9m haul in the previous 12 months. Last October it inked a partnership with Sophos, adding to a vendor stable that already included Microsoft, Acronis and Bitdefender.
Q&A with Giacom CEO Mike Wardell
Mike Wardell
What's been your biggest business highlight of 2022 so far?
Developing our business to converge our three brands, Giacom, DWS and Union Street, creating a truly unique proposition for our partners.
Do you expect to grow in 2022?
Absolutely!
Have you made any significant vendor signings in the last 12 months?
Our strategy is to develop our partnerships with the world-class vendors already in our portfolio, but we have also developed a strategic partnership with Sophos to help create their channel model.
Which emerging vendor/technology are you tipping for take-off in 2022?
We expect to see continuing advancements in working from anywhere technologies, with an increase in security, IoT, public cloud and MS Teams.
We will also see an increase in investment in infrastructure and the move to 5G and full fibre is likely to accelerate.
How is the chip shortage impacting you, and when will it end?
Our main business is focused on cloud software, physical infrastructure and mobility, so this is not having a significant impact on our business.
One [of my biggest mistakes] would be assuming we could sell any product by placing it in our marketplace
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
We expect to see further market consolidation across all areas, whether that's vendors or resellers. This is related to growing market opportunities and trends in convergence as, for example, many resellers require IT and telco skillsets.
What's been your biggest business mistake?
There have been quite a few! But I firmly believe making mistakes isn't a bad thing and it's the only way to learn.
One example would be assuming we could sell any product by placing it in our marketplace. We have learnt we need to do much more than that to help our partners - whether through training, marketing or pre-sales support.
The next company in the countdown specialises in managing 'tail spend'. Who are they? See next page...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
18. ASM Technologies
Revenue: £81m (+13%)
Staff: 83
Specialism: Tail-spend management
Top vendors: GoTo, Kollective, Forum Systems, Nitro, Primer, Bose, Echosec, Grafana labs, Camunda, Realwear
HQ: Cheshire
This Cheshire-based distributor claims its entire organisation is structured to help optimise "tail spend", ie non-strategic, off-contract purchases that may only represent 10-20 per cent of overall IT spend.
ASM saw revenues hike 15 per cent in its year to 31 March 2021, with the UK generating £59.6m of the £71.6m total. Net profits more than doubled to £2.4m. According to figures the company shared with us, 2022 revenues leapt again to £81m.
Q&A with sales director Iain Tomkinson
What's been your biggest business highlight of 2022 so far?
Continued growth is always pleasing however getting back to in person events and engagement with partners, vendors and the ASM Team has been fantastic.
Do you expect to grow in 2022?
Absolutely. We've had a strong start to the year.
What's the one market trend everyone else is missing?
The demand for innovative and disruptive technologies, across all sectors from finance through to healthcare and defence.
Have you made any significant vendor signings in the last 12 months?
We've made four additions to our strategic vendor portfolio this year. Primer, Echosec, Realwear and Bose Professional have excellent potential within our enterprise focused ecosystem.
Which emerging vendor/technology are you tipping for take-off in 2022?
VR/AR/XR has just started to show real value in spaces such as healthcare and industry sectors. Goldman Sachs have suggested that market could be worth up to $80bn by 2030.
Goldman Sachs have suggested [the VR/AR/XR] market could be worth up to $80bn by 2030
2022 will have been a successful year for your company if… we continue with our impressive year on year, organic, double-digit growth.
How is the chip shortage impacting you, and when will it end?
Most of our revenue is software based so no impact, however our hardware business has been impacted with constant delays on larger opportunities. We have a healthy backorder value though.
What, if any, role does distribution have to play when it comes to sustainability?
Distribution has an important part to play by looking at all operations, vendors and minimising our impact on the planet. ASM were one of the first companies of our type to opt for ISO14001, way back in 2005. We are now engaged with a number of third parties to work with us, guide and assist to ensure we are truly working towards a more sustainable business. Sustainability was key in the design and refurbishment of our new HQ. We've invested in solar power at our HQ in Cheshire coupled with EV charging for all partners, vendors and our employees to use.
What's been your biggest business mistake?
Becoming our partners' "best kept secret" and not shouting enough about the successes we have had.
See next page to find out which distributor has grown from zero to nearly $1bn in revenues in less than a decade...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
17. Pax8
Revenue: £100m (EMEA estimate)
Staff: 200 (EMEA total: 350)
Specialism: Cloud software
Key vendors: Microsoft, Acronis, SentinelOne, Bitdefender, Ironscales
UK HQ: Bristol
Founded in 2012, this US-based cloud marketplace specialist has grown its annual runrate revenues to $900m in the space of a decade.
According to market sources, its UK and EMEA business - which is based on its acquisitions of UK-based Wirehive and Netherland-based Resello in January and July 2021, respectively - already boasts a revenue runrate in the region of £100m.
In April, Pax8 pegged its market value at $1.7bn after scoring $185m in equity funding from Softbank. It will be used to "accelerate innovation and continued expansion into new global markets".
Q&A with Pax8 EMEA chief revenue officer Phylip Morgan
What's been your biggest business highlight of 2022 so far?
We recently hit 3,000 active partners. We've also earned close to 50 awards for the UK team, and attended more than 100 events in the UK
Do you expect to grow in 2022?
Pax8 UK has been growing 800 per cent yearly since we launched in Jan 2021.
What's the one market trend everyone else is missing?
Building a great culture and achieving low staff turnover. Our UK staff retention rate for 2021 is 92.6 per cent. And the power of connection; creating a P2P community where Pax8 presents and provides spaces for peer-to-peer learning and collaboration. The days of MSPs seeing each other as either competition or seeking to do everything vs. finding a specialism is gone. We look at ways to connect partners across varying specialisms to deliver a world-class, best-in-breed digital customer experience to enable all.
Have you made any significant vendor signings in the last 12 months?
- Nord Security
- Check Point email security
- Exclaimer
- Axcient
- SkyKick
- CyberCNS
- NovaSoc
Which emerging vendor/technology are you tipping for take-off in 2022?
When it comes to cybersecurity and data protection, we are constantly looking at new vendors to bring into our marketplace. In 2022, we launched the Cybersecurity Masterclass for our partners, and through that, we are engaging our leading vendors to support education and enablement around the NCSC Cyber Essentials Framework.
2022 will have been a successful year for your company if… we continue our mission to modernise business with cloud solutions. To-date, Pax8 has cloud enabled more than 220,000 businesses through its networking of 25,000 MSP partners.
Distributor share prices have cooled over the last 12 months. Is that a concern?
Pax8 continues to achieve record growth. Our business is not slowing down.
Pax8 continues to achieve record growth. Our business is not slowing down
What, if any, role does distribution have to play when it comes to sustainability?
Pax8 EMEA partners with Ecologi to plant trees and fund climate projects to help offset our carbon footprint. Robert Belgrave, our Chief People Officer, is a co-founder and acting chairman of Ecologi. Through this partnership, Pax8 has planted 36,126 new trees around the world and helped to fund 37 climate projects.
Employees can also solicit help for their preferred non-profit causes through our Celebr8 Community Programme, which brings together Pax8 employees and partners in support of local matters.
Which distributor (other than your own company) do you feel has done a good job over the last year?
Resello.com in the Netherlands. We loved their company leadership, culture, and innovative approach so much, we bought the company.
Which hardware distie broke £100m in its latest year? See next page for more...
45 Distributors You Need to Know 2022 - Part Two
Meet the UK IT distribution players ranked from 30th to 16th in this year's countdown
16. Ikonic
Revenue: £102m (+27%)
Staff: 86
Specialism: Hardware
Top vendors: Lenovo, AURA AIR
HQ: Heywood, Lancashire
Specialising in servers, storage, networking, power and 3D printing, this Lancashire-based hardware distributor claims to hold £7m of IT stock. Its vendor partners include Lenovo.
In calendar 2020, Ikonic saw revenues hike 11 per cent to £80.6m, with UK generating £50.7m of the total. Its 2021 revenues hit £102m, according to numbers it shared with us.
Q&A with group manging director Chris Perry
What's been your biggest business highlight of 2022 so far?
Seeing growth across the group, especially in the EU and also launching new services including key board reprinting within Ikonics circular economy division.
Do you expect to grow in 2022?
Ikonic have met its growth targets for the first two quarters of 2022 and our forecasts indicate that this will continue for the remainder of 2022 and beyond.
What's the one market trend everyone else is missing?
Remembering that people buy off people. Relationships matter!
Have you made any significant vendor signings in the last 12 months?
Ikonic are constantly adding vendors and building close relationships with suppliers.
Which emerging vendor/technology are you tipping for take-off in 2022?
Tailored IT hardware solutions to meet customers "green agendas". Ikonics ITAD team have seen significant increase in interest across various sectors requesting very high quality remanufactured and refurbished products.
2022 will have been a successful year for your company if…
We continue to meet our growth and profit targets and most importantly have a happy and healthy team. Continuing to play an active part within our chosen charities is also a key objective.
Distributor share prices have cooled over the last 12 months. Is that a concern?
It's not something we track specifically at this time unless we decide to float.
How is the chip shortage impacting you, and when will it end?
This has had an impact on us all and we do not see it ending until sometime in 2023. Ikonics ITAD/Circular economy division is doing some great work filling the stock gaps while bringing value to customers and the wider environment.
2022 has seen a couple of blockbuster distribution mergers already. What M&A trends do you expect to see over the next 12 months?
It's a fragmented market and so we expect consolidation are every level.
What, if any, role does distribution have to play when it comes to sustainability?
As a larger business within the industry, we expect to lead the way, and we are. We have initiatives in place to lower our carbon footprint as well as looking at our processes in a bid to be Carbon Neutral by 2030. However, this is something that all businesses need to be looking at no matter what their size.
What's been your biggest business mistake?
The market for refurbished products has gained pace quicker than we were expecting in 2020. However, we are pleased to have corrected this with significant investment in our ITAD division in the last year or two with investment in more specialist staff and services like our new keyboard reprinting.
The countdown continues next week....