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Punching above your weight in the channel


Johannesburg, 15 Sep 2021
Read time 4min 10sec

What is the goal of an SME? Is it to become a juggernaut, a multinational enterprise with an incredible market cap? Not necessarily. Some companies grow from humble beginnings into massive businesses, but that's not the only destination for an SME. One could argue it's the rarer outcome. For many SMEs, the focus is to deliver a specific range of services and products, stay agile and maintain their differentiation as specialists.

This definition is particularly applicable to the technology channel. Over the many years that Axiz has served the market as a distributor, we continue to work with SMEs. They fully deserve their reputations as dynamic and eager problem-solvers. SMEs genuinely are the engines that grow economies and GDP, a view expressed by everyone from the World Bank to South African President Cyril Ramaphosa.

Yet SMEs face a considerable barrier: they do not benefit as much from linear business environments.

What separates a major supermarket from a nearby corner shop? Both tend to have good locations – large shops are often anchor tenants, while small shops need good foot traffic to survive. But larger shops can offer a greater variety of products and buy in bulk to reduce prices. These are examples of linear scale: using current mass to improve reach and delivery. A small corner shop and most SMEs don't have such advantages, not in a linear world.

Yet, in a platform economy, the rules change. Linear is out and networking is in. To quote from a paper by the Organisation for Economic Co-operation and Development (OECD), online platforms "connect two or more independent sets of users and enable positive network effects, increase their customer base, reach scale without mass, find innovation opportunities and assets and access digital solutions and business intelligence services".

The emergence of the platform economy is a massive opportunity for SMEs, particularly in the technology channel. Many businesses are adopting platform-based services to improve their output and efficiencies, not to mention realise their digital aspirations. The technology world has grown suitably modular, making it easier for organisations to pick and choose solutions that work for them on a nuanced level.

Larger service providers are trying to adapt to platform-based service delivery. But they have a disadvantage. Just as a massive grocery store cannot conveniently fit on a tight street corner, a larger provider can lack the agility and specialisation to deliver on particular project requirements. Solutions involving DevOps, security, artificial intelligence, analytics and business continuity often require nimbler implementation and an eye on the little things. These needs are not always compatible with the more linear approach that large providers can indulge.

This is not to say that large service providers are on their way out. On the contrary, many are thriving. But those winners often adopt SMEs as partners and rely on SMEs to bring their ability and hunger for success to the table. Since technology delivery has evolved towards platforms and modularity, SMEs make the best partners for certain types of projects.

The challenge is how to empower SMEs to get to that level of partnership. SMEs face specific constraints. They may lack budget, licences or particular skillsets. They may be too small to qualify for rebates or blip on larger providers' radar and the channel's customers. Some bad SME business models have also burned customers and hurt the sector's credibility.

Yet, with the proper support, that is not the case. At Axiz, we have embraced the platform economy and built a digital hub that combines our strengths as a distributor, cloud service provider, business developer and activation partner. SMEs enrolled on the Axiz platform benefit from a vast network, a catalogue of services and support, and the opportunity to develop themselves as bona fide platform-era channel companies – with the backing and credibility Axiz has to offer.

Not every corner shop wants to grow into an enormous grocery giant. Not every SME believes bigger is better. Many prefer agility, flexibility and the chance to deliver focused projects – especially ones that deliver modern and emerging technologies. With the right support and guidance, they can break out of the linear world, pursue more significant opportunities, partner with larger enterprise providers and serve customers of all sizes. The Axiz platform can help realise all those possibilities and help SMEs punch above their weight in the channel. 

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