Channel is bouncing back

Beancounters at Context have added up some numbers and reached the conclusion that the channel has already started to show signs of bouncing back.

The outfit said that after looking at its four-week rolling average for year on year revenue sales growth climbing from minus ten per cent in week 16 to an increase of 4.6 percent in week 17, outperforming 2019 figures for the same period of minus 1.9 percent .

The analyst house highlighted is expecting second quarter numbers to come in with a 4.1 percent decline after a robust first quarter had delivered 4.8 percent increases.

Certain product areas continue to provide the channel with revenue growth opportunities, including AV systems, mobile and desktop computing, software, and licences. Recent weeks have also seen demand for warranties and service, ehealth devices, and games consoles. Context is warning that the biggest losers in the second quarter will be telecoms, printing hardware and consumables, displays and infrastructure and security.

Context global managing director Adam Simon said: “Aside from notebooks and some other consumer products, the challenge for the channel remains demand rather than supply. With most of Europe still furloughed, B2B projects have been put on hold, while consumer sentiment is dropping fast as unemployment bites and savings are depleted.“However, there are some bright spots. Mobile computing and software will account for nearly €7 billion in revenue in second quarter and computing components are making a turnaround as supply issues ease. With the economic problems having been sparked by coronavirus rather than the financial crisis of 2008 the hopes are that any recession will be a short one.”