 Best Emerging Sub Distributor - North
Pioneer Computers, Indore
With a turnover of Rs 42 crore in FY 2007-08, Indore-based Pioneer Computers recorded a 16 percent increase in topline over the previous fiscal’s turnover of Rs 37 crore.
A regional distributor for LG and Intex, and authorized distributor for Seagate, Intel and HP, nearly 50 percent of Pioneer’s revenue in the last fiscal came from the peripheral segment, while 37 percent came from re-distributing PCs.
The company entered the retail segment last fiscal by setting up a 3,000 sq ft showroom called E-Mall in the heart of Jabalpur. “Our entry into retail proved to be the key thrust for growth last year as it added 20 percent to our turnover. We also expanded our sub-distribution portfolio by adding, among other products, Sony notebooks. We undertook a major channel expansion program adding nearly 500 new resellers across smaller cities in MP,” disclosed Rakesh Agarwal, CEO, Pioneer.
Performance Highlights | - Opened a 3,000 sq ft multi-brand store in Jabalpur
- Added Sony notebooks
- Set up managed contact center for Madhya Pradesh Electricity Board
- Plans to open two large stores in Gwalior and Bhopal
| Company Snapshot | Company: Pioneer Computers
CEO: Rakesh Agrawal
Year of Inception: 1996
Turnover 2007-08: Rs 42 crore
Turnover 2006-07: Rs 37 crore
Employees: 34
Certified employees: 2
Principals: Intex, HP, Seagate, Compaq, LG, Acer, Hitachi, Sony Vaio |
ISO 9001:2000 certified, last year the company entered the field of providing call center services. It set up a managed contact center for the Madhya Pradesh Electricity Board, and provided connectivity solutions to the state’s IMP Grain Market connecting all their offices at the taluka level.
With an inventory management and CRM system in place, Pioneer has been focused on enhancing profitability. “The automation of systems has given us greater productivity as well as stronger visibility about our channel partners’ business. Using CRM we regularly plot the buying and payment patterns of each reseller we deal with. We have also identified a set of partners who are always keen to push high-technology products, and work closely with them to bring new and high-end products to the market. Marketing activities include event promotions and advertisements,” detailed Aggarwal.
The company is aiming for a turnover of Rs 60 crore by the end of the current fiscal. “I am extremely bullish about retail and plan to open two large E-Malls in Gwalior and Bhopal this year. On the sub-distribution front we intend to include more lifestyle products because that’s where the growth will come from. The focus on high-end products will continue, and we will keep building on our solutions and services capabilities,” said Aggarwal.
Best Emerging Sub Distributor - West
Ria Computers, Surat
Surat-based sub-distributor Ria Computers emerged as a leading distributor in the emerging markets in the western region. With a turnover of Rs 29 crore in FY 2007-08, the company recorded around 15 percent growth.
Performance Highlights | - Signed up with Acer, Lenovo, Hitachi, Seagate, Western Digital and Moser Baer as a sub-distributor
- Added two retail stores in Surat
- Floated several promotional offers for resellers
- Set-up small counters to sell consumables and accessories at 100 cyber cafes and computer training institutes
| Company Snapshot | Company: Ria Computers
CEO: Kamal Agrawal
Year of Inception: 1996
Turnover 2007-08: Rs 29 crore
Turnover 2006-07: Rs 26 crore
Employees: 44
Principals: LG, Acer, Seagate, Samsung, Intel, HP, HCL, Lenovo, Western Digital |
“Last fiscal was the year of consolidation for us as in the previous year we had grown by almost 100 percent. So we rationalized our product portfolio, added new brands and focused on retail in a big way. We also expanded our branch presence, increasing our penetration in the south Gujarat market,” said Kamal Agarwal, Director, Ria Computers.
The company added Acer and Lenovo to its desktop portfolio which earlier consisted of HCL and HP. Already a LG regional distributor; it became a Samsung Star partner focusing only on printers. It also added Hitachi, Seagate, Western Digital and Moser Baer.
The company boosted its retail business by adding two more stores to the existing one. “Last year, retail contributed only 10 percent to our revenue but with our strong focus we see at least 30 percent revenue from there,” said Agarwal.
To promote its retail business, Ria set up small retail counters to sell consumables and accessories at over 100 cyber cafes and computer training institutes in the city.
Having an ERP in place since 2006, the company is focused on boosting profitability. “Over the past two years we have begun the process of calculating product wise profitability for every credit cycle. We have improved our inventory management substantially by selling smaller quantities of products on shorter credit,” informed Agarwal.
To improve profitability further, Ria identified three high-margin categories—laptops, peripherals and laptop accessories and assigned product managers for each. “Each manager is empowered to undertake whatever marketing activity they believe will help them achieve their targets. For instance, one manager started marketing and selling laptop and computer accessories through mobile vans and this concept is working wonders,” said Agarwal.
To keep employees motivated, Ria launched an employee club which engages in conducting edutainment programs regularly. “We conduct Art of Living courses every quarter, along with half-day retail and product management workshops every month,” said Agarwal.
Ria also floated several promotional offers for its resellers. “The schemes we float for partners never involve cash incentives. It’s usually about family fun activities like giving away weekly movie tickets or holiday vouchers,” averred Agarwal.
This fiscal, the company plans to open at least three multi-brand retail outlets covering the upcountry market of Gujarat. “After consolidation last year, we are raring to go. We have set a 50 percent growth target this year,” concluded Agarwal.
Best Emerging Sub Distributor - South
Positive Systems, Kochi
In FY 2007-08, Kochi-based Positive Systems grew by well over 35 percent to post a turnover of Rs 64 crore over the previous year topline of Rs 47 crore.
Performance Highlights | - Started the practice of daily purchase for resellers
- Deployed two delivery trucks that ensured faster delivery to smaller towns; 60 percent savings on transportation cost
- Signed up as Dell’s regional distributor for Kerala
- Plans to deploy ERP and add more commercial products
| Company Snapshot | Company: Positive Systems
CEO: M P Sampath Kumar
Year of Inception: 2000
Turnover 2007-08: Rs 64 crore
Turnover 2006-07: Rs 47 crore
Employees: 53
Principals: D-Link, Dax, HP, Compaq, AMD, Microsoft, Lenovo, Dell, TVSE |
With a pan-Kerala presence with eight branches, Positive attributed robust growth of the company to two main factors—focus on upcountry regions in the state and better credit management.
“Last year, we consciously decided to consolidate our operations in the large cities and focus on smaller cities in Kerala. We work with only 15 key resellers in Kochi today. This was because we realized that markets outside the city give us better margins and shorter payment cycles,” said Sampath Kumar, CEO, Positive Systems.
To improve cash flows, Positive started the practice of daily purchases among its partners. “We decided to achieve monthly targets through daily purchases instead of the month-end large deals preferred by other
sub-distributors. Our aim is to ensure shorter inventory cycles and better cash flows for our entire ecosystems. Initially, we faced tremendous resistance from vendors and distributors but we persisted with our model. In the end, they had to accept our new business model,” added Sampath Kumar.
To ensure wider market coverage and speedy delivery of products to remote areas, Positive thought innovatively and bought two delivery trucks to ply across the state. “We no longer need to rely on freight
companies to ply our goods to remote locations. It has saved up to 60 percent of our transportation costs and reduced transit time of goods,” he informed.
Sharing his business philosophy, Sampath said, “Our endeavor has always been to work with select vendors and work to achieve the number one spot for them in our region of operations. We also expect similar exclusivity from our vendors,” he averred.
Positive regularly organizes marketing promotions for its resellers and has a dedicated team that conducts weekly training sessions on new products and technology. “Last year we organized 10 dealer meets for different vendors. During the festive season, we ran a huge promotion aiding our resellers to do more business. Most partners choose to work with us as we ensure timely distribution of back-end rebates,” said Kumar.
The sub-distributor has recently become an exclusive regional distributor for Dell and expects the business to contribute significantly in the current fiscal. It’s evaluating an ERP system and expects to deploy it this year. “Additionally we are looking at building a corporate reselling business for which we are aiming at adding some more commercial products to our existing portfolio,” said Sampath. |