A specialist technology consulting and research firm is predicting that the continued drive to digitally transform will see SMBs increase their spending on technology in 2023. It also says that confidence in business performance will remain high, despite the inflationary and economic challenges that small businesses face.
► SMBs will invest in IT solutions that drive innovation
► Adoption of new technologies will transform sales channels
The 145 million SMBs worldwide are expected to spend $1.45 trillion on IT in 2023, of which 40% will be from the Americas, 30% from EMEA and 30% from Asia–Pacific. This amounts to growth of 6.3% compared with 2022.
The firm also predicts there will be a ‘shakeup’ in how vendors and the channel sell to SMBs. It claims that its research found that one in three SMBs plan to switch channel providers to gain enterprise levels of service and support.
Technology vendors and resellers need to focus on service and support
It also said that while SMBs are continuing to invest in IT, the decision-making process is taking longer as SMBs are now examining the costs and benefits of any new solution more carefully. They are also moving more towards cloud-based and as-a-service solutions.
Analysis Mason says that technology vendors and resellers need to focus on service and support, while delivering clear messages around the business use cases of solutions. SMBs are looking for simple procurement and installation, tiered pricing and comprehensive support.
2023 SMB technology predictions
Ecosystem transformations
- SMBs are the new ‘enterprise-lite’ accounts
37% of SMBs plan to switch channel partners in favour of an ‘enterprise-lite’ experience of support and services that enable full client lifecycle management such as pre-sales, onboarding, account management, defined touchpoints and communication channels. - SMBs will look to MSPs for more than IT management
SMBs’ IT spending through MSPs is expected to grow by 11% year-on-year from $279 billion in 2022 to $311 billion in 2023, driven by the need for end-to-end support in managing increasingly complex software stacks and driving forward digital initiatives. - SMBs will spend more than $66 billion on IT solutions from telecoms operators
SMBs will increasingly look to telecoms providers for IT advice, support and services. 80% of SMBs would consider taking IT services from operators. Operators are creating targeted IT services bundles for SMBs and partnering with software/service providers to help them to reach a broader SMB market.
New spending priorities
- As-a-service spending will increase
SMBs’ spending on platforms-as-a-service (PaaS) solutions is expected to grow by 18% year-on-year from USD3.4 billion in 2022 to USD4.0 billion in 2023 as SMBs demand more flexibility without committing to expensive IT resources. Early adopters will increase their use of advanced analytics tools such as business intelligence (BI) and AI-powered applications.
Software-as-a-service (SaaS) spending is expected to grow from USD44 billion in 2022 to USD54 billion by 2023, representing a 22% year-on-year growth. SMBs are seeking to optimise and automate functions to increase efficiency and improve data utilisation. Spending on BI, ERP and line-of-business software such as electronic health records, 3D design, and IT monitoring solutions, will increase rapidly as a result.
PC and device-as-a-service (PCDaaS) models will shift focus from device procurement to a fully integrated IT experience. SMBs will increasingly value a holistic experience that includes services for deployment, desktop support, recovery, security and managed services for their dispersed workforce. - Rising energy costs will affect SMBs’ IT spending decisions
SMBs will look for ways to increase energy efficiency and to gain better control of their budgets. This will lead to an increase in the use of IoT-related solutions, such as energy usage apps and smart meters, in addition to finance and expense management applications. - Environmental, social and governance (ESG) initiatives will become a priority for SMBs
24% of SMBs worldwide plan to start ESG initiatives and 46% are more likely to buy from vendors with established ESG policies. - Cyber security remains a top priority
SMBs will continue to be concerned about cyber security thanks to device proliferation and ongoing geopolitical concerns. Spending on cyber-security solutions will increase from USD69 billion in 2022 to USD77 billion in 2023.
Read the full predictions here
