Over 1 million small businesses in India have plans to purchase PCs for the first time, according to a new study from Access Markets International Partners (AMI-Partners).
In a statement Friday, AMI-Partners said over 40 percent of India's 2.6 million small businesses that do not own PCs plan to make their first PC purchases within the next 12 months. This is expected to drive an estimated shipment of 1.6 million computers.
According to the research analyst, PC demand by the small business segment will boost the country's overall PC-installed base and PC penetration "to a significant extent". This translates into good news for both hardware and software vendors, said AMI-Partners.
"The India SMB sector is en route to becoming an extremely potent force within the Indian economy; yet it may seem surprising to many that a huge majority of this segment--roughly 65 percent--still manage without owning a single computer," Dev Chakravarty, Kolkata-based senior analyst at AMI-Partners, said in the statement.
Attributing the relatively low usage of PCs to a lack of awareness and education about the utility of computers, Chakravarty noted that over half of the entities AMI surveyed, said computers had no relevance in their line of business.
Business expansion is seen as a driver for the surge in demand for PCs by small businesses. AMI-Partners found that more than 75 percent reported revenue growth in 2007, and over a third of those polled indicated hiring plans in the next 12 months.
Small businesses, noted Chakravarty, are gradually realizing that computerization and automation is the first step toward managing rapid business growth. They could also be facing pressure from competitors, customers and suppliers to become PC-enabled, he said.
According to the study, 90 percent of small businesses without any PC investment had fewer than 10 employees. Over half were in the wholesale or retail sector.
While the local retail channel remained the preferred choice for businesses looking to purchase PCs, these small companies were also increasingly tapping on the reseller channel, said Chakravarty.
Small businesses, he explained, typically "need considerable hand-holding in the initial stages, in terms of installation and occasional troubleshooting". They also depended on ability of value-added resellers to offer personalized service and support, he added.
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