Economic Outlook 2024: Nine Solution Providers Reveal What They See On The Horizon

Executives from a number of solution providers speak with CRN about the opportunities and challenges they see for their business in the next year.

Outlook For 2024

This week, CRN’s team of editors spoke with executives from a number of solution providers at the 2023 XChange Best of Breed Conference to hear their outlook for 2024. We asked each of the executives the same question: What’s your outlook on the economy for 2024, and what impact do you expect it to have on your business?

XChange Best of Breed Conference, which was hosted in Atlanta by CRN parent The Channel Company, brought a focus on assessing the economic picture for next year, including with a session from economist and former U.S. official Andrew Busch. Along with new opportunities such as generative AI, Busch addressed the growing list of “X factors”—issues that introduce significant uncertainty into the economic outlook. Those include potential scenarios such as China invading Taiwan, Russia using nuclear weapons, cyberwarfare and, most recently, increased concerns over the Middle East after the attacks in Israel.

What follows are comments from nine solution providers on the economic outlook for 2024.

Felise Katz

CEO

PKA Technologies

If you had asked me this question before Saturday’s [attack on Israel], I would have given you a much different answer. Look, the world keeps on evolving. Things are changing so dramatically. It’s very crazy situation right now. I’m a little nervous because of Iran. I’m a little nervous about what this all means for the global economy—oil has already shot up. We don’t know what we don’t know.

Had you asked me before that, I would have told you that this has been a rocky year. However, we’re now at a different inflection point. I am very optimistic certainly for the balance of 2023 and going into 2024. I see the business is headed in the right direction.

Different pockets of the business are operating at different levels. It always is that way in our world—compute could be up, storage could be down, supply chain has a lot to do with it—but I’m very optimistic. There’s just so much going on right now in the world.

Michael Haley

Co-Founder, Partner

Edge Solutions

Worldwide IT spend will continue to grow, and we will continue to make investments to help create the outcomes our clients are searching for. At the epicenter of the technology ecosystem is the channel. Therefore, we are bullish on our prospects in 2024.

We believe the role of solution provider specialists is more important than ever. As OEMs and end users are asked to do more with less, the opportunities before us are greater than ever.

Vivek Kanakia

VP, Product Development

Digitek Software

We’re going to see some belt-tightening by the customer is just what I’m hearing from our customers. Part of that probably is because that’s what they are hearing from everybody else. It’s kind of like a vicious circle that if everybody starts being cautious, some customers go, ‘Well, then that means I have to be cautious. I need to watch where my dollars are going.’

I think we’re going see that but at the same time, I personally don’t necessarily think that we’re going to hit any type of recession. It’s probably going to be more of a slowdown. The pace of growth is going to taper off. I tend to agree with that assessment compared to saying, ‘Yes, we’re going to have negative growth.’

Jay Mellon

Co-Founder, CEO

AtNetPlus

I’m extremely optimistic. I attend a lot of industry events. I read a lot of the data out there, and everything seems to be consistent in saying that our clientele needs us today more than ever and will need us even more tomorrow. Whether it’s fully managed to co-managed. And security is an element of all of that, of course. There’s just a greater demand than ever before. I don’t know that our industry is recession-proof. But I think it’s pretty recession-resistant, if there even is one.

Even if you think that there’s not going to be continued growth in the coming quarters, as there has been, it’s not going to plummet. Even if there’s a little bit of slowdown with the growth, there’s still going to be growth.

I think a lot of companies that have really wanted to invest in an internal IT department are seeing that even if they still want to have some internal elements, they can’t do it all on their own. Years ago, you could have a couple of internal people cover everything. It’s just not possible today. And I think clients are finally starting to realize that, which is awesome. So if I wasn’t already in this industry, I would be trying to get into it.

Maryann Pagano

Co-Founder, CEO

BlackHawk Data

I think 2024, for us, is going to be a good year. I feel like I have the right staff in place, the right clientele in place, the right referrals. We’ve gotten to a really solid point. I think we’ve come up with a few offerings for 2024 that I think can be super helpful for a lot of what we’re doing. So I think it’ll be something different that we can offer clients. [One offering is a] private 5G LTE offering. We’re getting ready to proof of concept at one of the airports locally, and we have some school districts that are looking for it. They’re going to use it for the backbone of some of the network infrastructure—wireless for the schools, connecting all the campuses, and being able to hold on to wireless when they bounce from campus to campus, and having connectivity a little more settled than it is.

Raymond Paganini

CEO

Cornerstone IT

We see some growth, modest growth, for ourselves. We’re planning for a little bit but hoping for a lot. Next year what we’re predicting is less than what we’ve been forecasting in the past. But we’re optimistic that we’re going to match that and hopefully beat it, just because we see the market is slowly picking back up. And opportunities are out there.

As a company, our market now is more mid to enterprise level. So now we’re talking hundreds of users up to 1,000 or more. So we’re going in there to help them get their security in order and watching what goes on within their network.

Tanaz Choudhury

President, CEO

TanChes Global Management

We are thinking about 2024. We have to. If we don’t keep ahead of it, we will be behind.

The idea is that the economy was heading toward a recession with all of the things happening in Congress … the shutdown.

We saw a little bit of that translated when we were getting POs [purchase orders] from the government sector. … The government clients would put a disclaimer on the orders they were placing, especially larger orders. Especially things like Cisco, where we know there’s a lead time that may bleed into next year.

They were telling us to be mindful of the fact that if there is a government shutdown, then that net 30 [paying an invoice within 30 days] could turn into a 60 or a 90 even. And we have to be mindful as suppliers to them at all times that net 30 does not always mean net 30 when it comes to the government sector.

So that’s one part of it. But now those restrictions were lifted. So that tells me that we are OK for now, but in the last six to eight years, we’ve seen this sort of not normalcy within the government sector. And obviously we can see why. It’s everywhere. The political climate is rather murky.

And so it doesn’t matter. Business has to go on. Politics is politics. But politics doesn’t pay bills. Business does. So we have to continue the mindset of how we are going to forge forward. What have we got to mind? What are we going to kind of be aggressive on when it comes to investments and ideas? … Since COVID, that [state and local government business] has almost doubled for us.

So I feel like there is room, there is money in the government. We just have to know which section of government we are going for. And we have to be mindful of the fact that we should have the ability to float the net terms if it needs to be extended.

So don’t bite off more than you can chew because you will get into trouble. And that’s never a good option. I always, also, opt for the option where they get a discount if they pay in advance or if they pay on time. And those are things that you can, again, maneuver for your business as you see fit. Each business is different. And they have to understand what works for them and what doesn’t.

So if you can afford it, then yes, it’s a good sector to be in, because you will get paid. You just don’t know when. … [With COVID], technology has received the boost that it never had previously. It was always a hard sell to get them [government agencies] to invest in technology.

But now it is not, which is fantastic. In fact, they are researching ideas and coming to us, saying, ‘Hey, what about this? What about that?’

It’s a nice kind of way into what’s next in technology. Something like AI is something that they’re talking about. They’re also talking about big data—how do they leverage that data and that information. Storage has got a big push now again because obviously everything needs to be stored somewhere. And so it’s a full circle. Everything touches everything. It just depends on where you are.

So I feel like the economy and technology are going to run hand-in-hand for now. … We are also very, very familiar with the SMB space. … We’ve mindfully tried to leverage the refresh years for government agencies and private agencies so that we can hedge one against the other when the other is down.

So we’ve tried to do that a little bit. And we’ve done that mindfully. But obviously, you know, it doesn’t always work out the way you foresee it to be. So under the circumstances, we’re doing all right. When one is not bringing in that much leverage, the other is. So it’s a nice little hedge between the public and private sector.

But, again, the economy is going to control both public and private. So private companies are not going to spend if the government is not spending as much. It’s a trickle-down effect.

Sandra Anoun

Director, Sales, Marketing

Vintage IT Services

In 2024, I anticipate a continued recovery from the COVID-19 pandemic. Economic growth may vary by region, but overall, businesses should prepare for increased competition, potential inflation, and a greater emphasis on digital transformation as the economy becomes more technology-driven. … I feel like our best customers who trust us and take our advice. … they continue to proceed and move forward and they take our recommendations and they spend.

What I’m also seeing is a lot of mergers and acquisitions. And from that, what that might be doing internally is those clients don’t want to spend. They have to keep their numbers where they are at, as they pitched it. … I will say the demand for security, people are getting hit more than ever, especially since COVID.

The bad actors are out there. They’re targeting these customers. And fortunately, through partnerships, we’re able to resell—whether it’s email phishing campaigns or additional cybersecurity solutions that we are experts in.

So that’s been helpful as far as engaging with more partners. And we are able to provide those solutions to our clients.

Phil Godwin

President, COO

Clear Technologies

[Right now] it’s mixed. If I look at our two businesses, if I look at our outlook for our reseller business, we have big projects.

We have enough big projects to take us through at least the next six months. I’m pretty pretty bullish on that.

If I look at the Software-as-a-Service business, it’s a bit of a nice-to-have. We are still seeing the spend. But we are seeing some people start to pull back and say, ‘Hey, budgets are affecting things. We’re seeing budget cuts.’ … I would say that started in early summer.

And then we have a lot of people saying, ‘Hey, let’s look to next year’s budget.’

I think some of those deals that have gotten pushed—well, we’re still getting them pushed mostly. There’s still a fear of that.

I probably have a more optimistic view for us than a lot of the economists do. … We just have to be logical on what projects do we know are mandatory, that support business-critical things. And which ones are nice to have.

From our standpoint, we’re still seeing good growth in the server business. Storage. We’re growing our security business. I think that’s going to be there.

There are things that are going to be economy-proof, and there are going to be things that are going to be affected. We have to be logical and reasonable.