As part of our European Elite project, put together in association with Agilitas, our panel of experts look at the UK and Irish market, and pick apart what Brexit has meant for the industry
Brexit is the "elephant in the room" for any UK, or even European, IT services company. And for any VAR, approaching a conversation with customers around one of Europe's largest political and economic shake ups in recent times will never be easy.
Yet our panel suggests that, regardless of what deal the UK walks away from the EU with, the nation will remain one of the world's most significant and essential economies, and a vital breeding ground for new vendors and channel players.
"The UK has more opportunity at this moment in time than probably any of the other European areas, certainly from an Agilitas perspective, and I think we are going through one of the most interesting and therefore most opportunity-rich periods of economic and social change that we have probably seen since the late 1980s," said Shaun Lynn, CEO of Agilitas.
Yet Barrie Desmond from Exclusive Group, claims that Brexit negatively impacted his firm's financials in 2016.
"It affected our UK business quite significantly last year because we report in euros, so the currency issues impacted our top line, and more importantly, our bottom line. And the bottom line we use as the fuel to put an engine in our business," he said.
But Desmond remains positive that the UK will still be a desirable place for business, even after the UK exits the EU.
"At the end of the day we will do what our customers want and there is no doubt that the UK is a significant market for all of us in the room and for every technology company in the future, whether we stay or leave, or whether it's a hard Brexit or a soft Brexit."
Lynn said his biggest concern surrounding Brexit is how the UK will address its already-present skills gap, explaining that around 25 per cent of Agilitas' workers in its UK headquarters are EU nationals from outside of the UK.
"I think the biggest issue I see at the moment from a Brexit-specific perspective is that the UK needs to address its skills gap and we need to keep our skills sharp, plentiful and available and I think the challenge Brexit has is that there is a danger the UK can be perceived as not being a particularly welcoming place and that is one of the things we need to address very quickly."
According to Desmond, however, Brexit has prompted VARs to think more European, and since the Brexit vote passed last year has witnessed a spike in cross-border M&A activity within the channel.
"What we are beginning to see interestingly is a cross-border interest and activity on the M&A side, particularly on the resellers and SI level… we are seeing business, even with the paranoia around Brexit, saying ‘we can now sell right across the geography, right across the European continent," he claims.
"I have seen investments from Italian companies, and Dutch companies building and buying, so I think there has been some interesting and positive activity in that space."