“Access to capital in the current economic situation has been one of the key challenges for smaller enterprises. Here financing provides with a direct access to capital markets like HP Financial Services are able to provide some innovative finance and leasing schemes,” says Vikram K, director (key market), technology solutions group, HP India.

Meanwhile, Cisco has found quite a favorable response for its 0% financing for Cisco Multi-Year Services Program, wherein the company provides an interest-free financing package for multi-year contracts for technical services, SMARTnet and advanced services programs.

Changing Investments

One of the changes that has become evident at the moment is the move to tactical investment rather than strategic. What this effectively means is that it will be hard for a vendor to convince the entrepreneur into investing into a BI solution, but a PC-sharer could very well do. According to watchers of the industry, SMBs will be focusing on making wise investments that both reduce costs and enable them to better leverage technology.

Nonetheless, this has certainly not deterred the vendors from courting them. Rajeev Mittal, group director, small and medium enterprise, Microsoft India, hints at the same when he says, “Liquidity seems to be the topmost challenge for SMBs and is likely to remain a priority into the next year.”

IDC believes that SMBs are more likely to focus IT investment on tactical projects, which deliver immediate benefits, rather than strategic projects. Clearly the immediate and near future is the focus of SMBs. So the technology investments which they will be looking at are those which will stand them in good stead at the moment. According to AMI Partners the lease/finance model will also start seeing more adoption.

Challenges Galore

Beyond the price debate, there are some more challenges that vendors face when it comes to servicing the SMB segment. The biggest among them is sheer ignorance. In most cases, these firms are driven by a single entrepreneur who may or may not be IT savvy. Also there is a reluctance to pay big money for IT investments, especially when it comes to pay for software.