The RSPA released their Retail IT Channel KPI Study too. Quoting the report:
Retail IT solution providers rebounded in a big way from the COVID-fueled economic crisis of 2020. In 2020, nearly 23% of survey respondents (22.9%) reported a decline in sales; that number fell to just 7.5% in 2021, a difference of 15.4 points year-over-year. Also, in 2020, over a third of respondents (36.2%) experienced flat or declining sales compared with just 19.8% in 2021, a 16.4-point difference.
2021 didn’t go quite as well as retail IT solution providers predicted, but they weren’t far off. About 20% of survey respondents (19.8%) experienced flat or declining sales, while predictions anticipated only 14.6%would. 50.0% achieved double-digit growth instead of the projected 52.5%.
Profits are up too. In 2020, 8.5% reported a loss, while only 3.8% did in 2021. Also, the number of solution providers reporting margins of 20+% nearly doubled from 25.2% in 2020 to 45.3% in 2021.
Compared with last year, the 2022 list of benefits barely changed in terms of the percentage of companies offering each line item or which benefits are most commonly provided by VARs and ISVs. Flexible work schedules moved up the chart in 2020 and remained a common benefit in 2021 (52.4%). The benefit of free food/beverages rebounded a bit last year (32.1% 2019, 23.5% 2020, 27.6% 2021), likely because more workers are returning to the office.
The average gross income for techs clusters in the $41-$60k range (33.9%), with the next most common income range being $61-$80k (22.5%). Only 6.5% of resellers and ISVs report an average tech gross income above $100,000, essentially unchanged from 2020 (6.1%). Around a quarter of top techs earned between $41-$60k (24.5%) while 36.8% earned between $61-$100k; 13.1% of top techs earned over $100k, matching the 13.5% figure in last year’s study. End quotes.
HOWEVER, while I’m looking at small businesses, let’s note that February’s National Federation of Independent Business Optimism Index fell to its lowest monthly point since January 2021. According to data released Tuesday, the 95.7 score is also the fourth-lowest mark in at least five years.
Why do we care?
A solid market yet not necessarily explosive would be my take – and good news to see 2021 better than 2020, making logical sense looking at the retail space.
The hiring data spoke to me – flexible work schedules now as a critical benefit… and likely considered standard. That said, tech salaries aren’t going up? That seems likely to change – and something I would most certainly be pondering if I was an owner in 2022. With the labor market as tight as it is, salaries will need to go up.