The German IT & Telecom Distribution Channel

Overview of IT & Telecom distribution in Germany, including essential information to develop indirect sales.

The German IT & Telecom Distribution Channel
Macroeconomic data (2014 if not specified)
General Data Macroeconomic Data
• Area: 357,021 km2 • GDP/capita: 53,609.59€
• Population: 80.68 million • GDP/capita vs. US: 87.45%
• HDI : 0.916 • GDP growth rate: +1.6%

ICT Market Tendencies

The German distribution channel is composed of 44% service companies and 20% resellers. Manufacturers represent only 8% of the total number of channel players. VARS account for about 40% of all channel players. On the computer software market, the top 25 suppliers hold 40% of the market share and more than half of the sales are to SMB companies. With the development of e-business, on-line sales play an increasingly important role: 14% of channel players using this sales method.

Germany is the world's third largest ICT market, and as the EU's leading market with 20% of the total it provides lots of opportunities. Its estimated value is 138.7 billion EUR. One-fourth of the total R&D spending belongs to the ICT sector, as innovation is one of the motors of the industry. Germany is also the European leader in Internet commerce and one of the world's most sophisticated markets. The country has the highest market share in Europe for both B2B and B2C commerce. Germany does not have a sole IT growth region and its activity is well spread around the country. Nonetheless, three areas represent a high number of corporate headquarters: Munich, Frankfurt and Hamburg.

The German ICT market is expected to expand by only 1.5% in the coming year. This slow growth is strongly connected to the GDP trend, which directly impacts consumer demand. Exports play an important role in the German economy and 27% of ICT sales are generated from exports. Outsourcing is also a key factor, mainly due to cost and high taxes; an 8.3% increase is expected from the outsourcing services. The hardware sector is characterized by a sharp drop in prices, but there is still a good trend in terms of volume sales, especially in the case of laptops, where forecasts show an increase of 8% for 2008. However, the desktop PC market will continue to slow, with less than 3% increase over the previous year. As for printers, the multifunction category continues its weak growth with only 2.2%. The software sector will follow the same tendency with an estimated 5.3% increase. The German software market is the world's second largest, right behind the U.S. IT and network security, knowledge management, web services and new products based on broadband technologies such as WLAN are seen in general as major drivers behind the sector's recovery. Business applications continue to develop as more than half of the population purchases via the Internet, together with CRM, SCM and business intelligence software.

As for the services sector, growth will continue with a 6.6% forecasted increase, mainly due to the cost reductions via outsourcing. Most of the sales come from U.S. companies with German operations, as American products enjoy a strong popularity among the Germans. As for telecommunications and network equipment, the market is already considered as being mature and mainly relies on mobile phones (1.6% of increase expected), WAN data routers and switchers (4.8% growth) and especially infrastructure services (7.3%).


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Distribution players: 
ALSO Deutschland GmbH ; Ingram Micro GmbH ; Tech Data Deutschland ; Hagemeyer Deutschland GmbH & Co. KG
IT Channel Press & Players:
CRN (IDG) ; Computer Partner Germany (CMP)
Public organisations & Useful Associations:
Deutscher Multimedia Verband (DMMV) ; Verband der Deutschen Internet Wirtschaft (eco)