Indian SMBs: The Biggest But Most Difficult Market

For most Indian IT vendors as well as resellers, the SMB segment remains a large jigsaw puzzle which seems to be growing multi-dimensionally every day. Pundits say that the enterprise business is easier to tap because of the smaller set of customers. Also, most vendors are engaging with large enterprises directly, at least from a relationship perspective. “The enterprise landscape in India today is charted very well, and most mature vendors have good understanding of the accounts and what these customers plan to do,” says Vishal Tripathi, Principal Analyst, Gartner India. The SMB business appears to be a different ball-game. Basic activities such as aggressive pricing, and investments in marketing and brand building, help in garnering consumer market share.

The Indian SMB market is one of the toughest in the world as the market size is huge and spans across the diversity of the country. And beyond some of the basic trends, there are no fixed patterns on how an SMB thinks and buys, making it a very difficult terrain to operate.

The number of business organizations in India is huge, and AMI classifies around 4.15 million separate entities in the Indian landscape. Of these, around 4,660 are considered large businesses which are already on the radar of most IT vendors; these are organizations with more than 1,000 employees. AMI says there exists around 32,600 medium businesses in the country with an excess of 100 (IT) users. Apart from these, there exists 1.6 million small businesses which have seen some form of IT penetration. At the same time, more than 2.5 million small businesses exist which would buy a PC in the next few years.