Indian Medium Businesses Spent Nearly $3 Bn On IT

by CXOtoday Staff    Feb 01, 2005

Driven by faster adoption of connectivity, computing, and productivity solutions, medium-sized businesses (MSBs) in India spent more than $2.9 billion on IT products and services in 2004.

According to the recent findings of Access Markets International (AMI) Partners Inc., the previously under-saturated MB market made strong strides in adopting new and advanced IT products and solutions.

This encompassed virtual private networks (VPNs), networked storage, wireless LANs, intrusion detection, firewalls and customer-focused enterprise applications.

According to Swati Sasmal, senior analyst at AMI-India, “Indian MBs face further challenges in the wake of increasing globalization. Creation of a secure infrastructure is a priority since the risk of cyber crimes is greater than ever.”

“India MBs have also become much more client oriented because customer satisfaction is the buzzword for success in the current era. For this reason they intend to remain constantly accessible by customers, creating a 24×7 atmosphere,” added Sasmal.

With increasing globalization, connectivity has become essential to MBs in India for efficiency and broader reach. They are moving towards an un-wired world as well, as evidenced by 62% of the MBs expressing their willingness to adopt wireless LAN.

In an attempt to reduce inventory and increase cost control, 70% of MBs in India are emphasizing the adoption of solutions for successful supply chain management. As a result, over two thirds of medium businesses expressed the need for enterprise software applications such as CRM and ERP software packages.

Although India medium businesses are highly metro-centric, close to 26% is located in and around mid-sized cities and small towns. “IT vendors are increasingly sharpening their focus towards Tier 2 and 3 cities as metro cities are approaching saturation,” stated Sasmal.

54% of Indian medium businesses plan to expand their workforce over the next 12 months. More than two thirds of businesses have multiple sites and 19% of MBs plan to open new sites or branches.

There are over 46,000 India medium businesses, employing between 100 and 999 employees and generating average annual revenues (sales turnover) of $13.4 million each.

New York-based AMI conducts the annual tracking surveys of SMBs in several countries.