www.itp.net MARCH 2010
SLOWDOWN IN JARIR SALES GROWTH METRA INVESTS IN LOGISTICS NETGEAR SETS SIGHTS ON SMB GLORY JUMBO MULLS ACCESSORIES UNIT
Licensed by Dubai Media City
SURVIVAL INSTINCT Why enterprise VARs can expect their landscape to change (20)
TAKING STOCK How to master the art of inventory management (23)
After a turbulent year for distribution, we lift the curtain on the 15 largest Dubai-based players in the market today‌
Vol. 08 Issue. 03
Building and delivering IT solutions for the Middle East An ITP Technology Publication
IS YOUR TRADITIONAL NETWORK AND DATA PROTECTION PROVIDER STUCK IN THE PAST?
Traditional net work and data prote c tion providers resist advancement. They stick to the status quo, no matter how primitive it becomes. But now, there’s a more evolved solution provider. SonicWALL® enables organizations to move ahead with a comprehensive line-up that advances both protection and performance. SonicWALL’s NSA E750 0 nex t generation firewall with Application Management provides a major breakthrough—full Unified Threat Management protection along with 1,288 Mbps in network throughput. SonicWALL Aventail E-Class Secure Remote Access delivers best-in-class access along with the status quo disrupting ability to easily establish, manage, and enforce real granular control over every endpoint. SonicWALL Email Security delivers bestin- class protection against spam and other email threats like phishing, and can be deployed in minutes and maintained in minutes a week. That’s a level of simplicity that the status quo can’t touch. SonicWALL Global Management System provides a flexible, powerful, intuitive, and civilized way to manage and deploy SonicWALL appliances and security policy configurations. Learn more about SonicWALL’s advancements in high-performance protection VS the status quo at www.sonicwall.com/performance
Call +97146091753 Email: mea@sonicwall.com Support toll free: 8000 4411869
NETWORK SECURITY
SECURE REMOTE ACCESS
WEB AND E-MAIL SECURITY
BACKUP AND RECOVERY
POLICY AND MANAGEMENT
© 2010 SonicWALL, Inc. SonicWALL and the SonicWALL logo are registered trademarks of SonicWALL, Inc.
_www.itp.net_
DATA LIST (1) // HEADLINE NEWS FROM THE MIDDLE EAST IT CHANNEL
::
MEA DISTIES GO BACK TO BASICS Unpredictable trading environment and relentless pressure on costs force IT distributors to take a systematic approach to business as they attempt to ride out the market storm
WHO WILL YOU PICK?
T
he countdown to the 2010 Channel Awards has now
begun, with the focus instantly
>>
The region’s largest IT distributors are taking a back-to-basics approach to business as they attempt to climb clear of the difficult trading conditions that have disrupted the market throughout the past year. Faced with stalling demand and a highly
constrained credit environment, distributors are scrutinising every aspect of their operations in a bid to keep costs under control and ensure they do not leave themselves financially over-exposed. For most distributors that has meant an enhanced focus on
controlling working capital and cash, as well as a closer analysis of operational efficiency. “It is important to manage your business at a micro-level by going into more detail instead of just delegating,” said Mario Gay, general manager at components and enterprise distributor Mindware. “Today I think you need to look at things through a magnifying glass.” Research carried out ahead of the publication of this year’s distribution Power List (which you can read on page 24) reveals that the combined annual revenues of the 15 largest Dubai-based
METRA “RAISES ITS GAME”
JARIR FEELS RETAIL PINCH
Distributor claims new logistics hub will strengthen its Gulf operations
>> KSA ace sees slowdown in sales growth The days of soaring double-digit sales growth
>> in the Saudi retail channel could be over after audited financial statements released by
market powerhouse Jarir revealed the company only saw a minimal increase in revenues last year. The retailer posted sales of SAR2.55 billion (US$681m) for 2009, which marked an increase of just 1.5% on the SAR2.52 billion (US$671m) it recorded during the previous 12 months. Analysts have said the Saudi market was the least
distributors operating in the market increased just 2.7% last year. That figure compares with 24% the previous year, indicating the extent to which the distribution sector has felt the force of the economic downturn. Amer Khreino, CEO at Emitac Distribution, says the financial crisis has taught the distribution channel some harsh lessons: “Today it is very difficult to claim that distribution is not about credit facilitation, financing the business and logistics services, but these are the classic deliverables. No distributor can sustain business without - - - > (4)
- - ->
(7)
IT distribution powerhouse Metra is preparing to open a new logistics facility that will serve as an integrated hub for its operations across the Gulf. Metra, which is one of the main regional distributors for brands such as HP, Acer and Samsung, will call time on the outsourced logistics model it currently uses and switch to its own selfoperated 70,000 square foot facility instead. The company said it was likely that the facility would begin receiving consignments and dispatching orders from as early as this month. Metra has not revealed the total value of its investment in the project, but said the hub would be supported by new ERP and warehouse management systems that should make its logistics processes slicker. - - - > (9)
turning to the two ‘Readers’ Best’ awards which are voted for online by you — our readers. The ‘Best Vendor Channel Partner Programme’ and ‘Best Growth Initiative by a Distributor’ are the only two categories that are decided by the readers of the magazine. You therefore have until the middle of this month to make your vote count by visiting the link at the bottom of this page and selecting the vendor and distributor that you believe deserves to honoured in their respective categories.
The winners will be revealed during the Channel Awards in Dubai on Monday 22nd March. There is a strong line-up of candidates for this year’s readervoted categories, with all of the shortlisted companies keen to emulate Microsoft and Westcon, who took the glory at last year’s Channel Middle East Awards. To view a summary of each finalist’s submission and cast your vote, just visit the Channel Middle East Awards website and follow the reader-voted link. www.itp.net/events/channelmeawards
// INSIDE THIS ISSUE >>
FRONTLINE
// CONTENTS CHANNEL MIDDLE EAST_MARCH 2010
_New roles for channel stalwarts 4 0
_Netgear targets SMB market 9 0
_Jumbo hints at accessories move 4 0
_eSense gets serious in Saudi 9 0
_Astaro changes sales model 7 0
_Dell test centre launched in S 9 0 KA
_Sony and Trigon in storage pact 7 0
11_BTC agrees to Alcatel-Lucent tie-up
FEELING THE STRAIN
Com hails MEA prospects _3 9 0
11_Master status for Trade Links
_Sales perks for Symantec A 9 0 VRs
11_Aptec wades into S KA battle
Data confirming how the EMEA PC market stood up to the economic downturn last year has just been released, but it won’t please everyone.
>]
INSIDE INFORMATION
[]
PRODUCTS
20_BULLISH ABOUT BUSINESS
59_JOINING THE ELITE
Miguel El-K houry, director of Gulf Business Machines’ (GBM) 15 -0strong integrated networking and site services unit, explains why changes in the Middle East market are calling for some strategic thinking among systems integrators.
HP claims its Compaq 0 8Elite laptop offers reliability and security
oo
BUSINESS INSIGHT
53_CISCO SHUTS DOOR ON HP eVndor confirms it will not renew HP’s reseller accreditation due to their increasing competition
53_SOURCEFIRE ON SONG Security vendor puts emphasis on new partner programme to drive greater percentage of its business
(15)
(23) TAKING STOCK
59_TAKE A TABLET
Mastering the art of inventory management can mean the difference between profit and loss for any distie selling fast-moving products.
Fujitsu introduces an alternative version of its Lifebook T5 10PC 0
59_KEY TO SUCCESS New Microsoft keyboard aims to give gamers more control of their actions
59_ROAD WARRIOR
(26)
Sony Gulf launches latest range of A VIO notebooks in the Middle East
(17) >>
2010 POWER LIST Hold on tight as we bring you a comprehensive rundown of the largest IT distributors operating in the Middle East today.
EDITOR’S NOTES
Why cash is the currency of choice on Computer Street
53_CA VARS HOPE TO RECOVER
(44)
Two thirds of EMEA resellers polled by management software ace believe the worst of the recession is over
(19)
YEAR OF THE VAD Emerging technologies distributor FV C reveals why it is listening carefully to its reseller customer as it looks to drive the A VD model.
EXPERT’S VIEW ingston’s John Tu on the K
>> future of the memory market
(60)
IT’S SHOW TIME!
Your guide to the key IT events taking place this quarter
>>
(64)
COMMENT
>> Industry talking points
(49) (15 )) 115 .... .. ...
(62) GET TO KNOW {}
Shahnawaz Sheikh, SonicWall MEA
FACT FILE
Global smartphone market emerges from the fourth quarter in rude health
_www.itp.net_
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
FRONT LINE (4)
< - - - (1) them. But during the crisis we learned that these principles could only get you so far. To retain customers requires a good rapport, market recognition, commitment and loyalty, as well as the right product mix.” Nicholas Argyrides, general manager at HP and Cisco distributor Logicom, agrees that keeping sight of what customers need is crucial to prevailing in a market where new challenges are coming from multiple directions. He believes relationships and pre-post sales capabilities have emerged as the fundamental principles of distribution. “If you are able to make customers look at you in a way other than as a discount shop then it is the best way to work, especially in today’s
climate,” he commented. “Preand post-sales support, whether it’s education, timely deliveries, RMA or something else, are the things that make a customer loyal to you, even if your prices are a couple of dollars higher.” Without doubt, distributors have also had to quickly adapt to an uncertain credit environment. The withdrawal of cover by many credit insurers has forced distributors to either take additional risks themselves or walk away from accounts they suspect may not be able to meet their obligations. Raj Shankar, CEO at Redington Gulf, puts credit management up there with logistics and working capital management as aspects of the distribution business which need to handled carefully
during the present climate. “Credit management is especially important in the Middle East and Africa, where you have to give credit,” he said. “But credit management isn’t about refusing credit — it is about giving credit but collecting your money.” Faisal Jamal, COO at Despec, also says disties have to become experts in credit and finance. “Credit insurance companies are not giving the kind of insurance coverage they used to — or if they are the prices are expensive — so you have to have effective and structured credit control,” he warned. “Customer reach is important too. If you don’t analyse your customers properly you may become over-centric on a certain type or a certain region,” he said.
CHANNEL STALWARTS TAKE ON NEW REGIONAL ROLES Ahmad Qasem back in the channel at Epson, while Feras Zeidan begins Avaya assignment
T
wo of the channel’s most recognised faces have taken up new vendor roles in the Middle East region after recently leaving their existing companies. Ahmad Qasem, the former boss of hardware distributor Al Yousuf Digital, has joined Epson, while Feras Zeidan, who formerly ran Trapeze Networks’ MEA business has joined Avaya. Qasem has become the channel manager for printers, projectors and scanners in the Middle East. He is already well familiar with the Epson business as Al Yousuf is one of the vendor’s primary distribution partners. But Qasem insists his long
>>
.... .. ...
>]
=
association with Al Yousuf will not prevent him from treating all partners fairly. “I will try my best to make sure everybody is happy and achieve that with high morale and honesty to everyone in order to help them grow,” he explained. “And that includes growing distribution partners’ business everywhere — this is what the Epson team is aiming for, not just me.” Zeidan, meanwhile, has joined Avaya as channel manager for Saudi Arabia, reporting into country manager Fadi Hani. His role will be to expand Avaya’s channel in the kingdom and overseeing the integration of the IP
{"|"}
*/
[]
[o]
telephony vendor’s partner base there following its takeover of Nortel’s enterprise business. “We will make sure that this partner base will offer the required set of skills and get the training needed to gain more accounts and service current customers,” promised Zeidan, who met with partners for the first time at Avaya’s regional partner summit last month. Avaya is shortly expected to reveal the identity of its new Middle East channel director, who will take on the role formerly handled by GCC boss Roger El Tawil.
\ -->
oo
{}
Feras Zeidan is now heading up Avaya’s channel in Saudi Arabia
JUMBO HINTS AT MOVE INTO ACCESSORIES Hardware distributor could add peripherals to portfolio
J
umbo IT Distribution is weighing up the possibility of creating a dedicated business unit focused on IT accessories, which would supplement the volume products it sells to the retail channel. The move, if it happens, would see the company push PC peripherals and devices alongside the core HP, Acer and LG hardware products that it distributes. Jumbo already sells some IT accessories, but these tend to be given away as part of bundles, which is “not a business model”, according to the company’s general manager, Bikas Biswas. He believes there could be value in developing a specialised accessories unit now that the firm does such a large portion of its business with the retail market. “Since we have become a retailfocused distributor it would give us a huge amount of alignment with all the retailers and possibly help us because it is a high margin, low volume business,” he explained. Jumbo hasn’t yet opened talks with any potential accessories vendors, but the type of products it is thinking about include flash drives, keyboards, mice and high value carry cases. Biswas says the idea is being assessed by group management, but he does not expect any decision to be taken before April at least.
Introducing Server Room in a Box
APC rackbased cooling draws in hot air from the rear, at its source, and then sends conditioned air out the front, ready to be used by adjoining racks.
APC integrated cooling future-proofs your IT room without breaking the bank Is your server room a barrier to adopting new technologies? Consolidation, virtualization, network convergence, blade servers—these new technologies improve efficiency, cut costs, and allow you to ‘do more with less’. But they also bring high-density power, cooling, and management challenges that server rooms were never designed to handle. You’re relying on guesswork, depending on building air conditioning, or improvising remedies. So how can you increase the level of reliability and control in your server room without spending a fortune?
Introducing the APC by Schneider Electric total server room solution Now you can get power, cooling, monitoring, and management components that easily deploy together as a complete, integrated solution. Everything has been preengineered to work together and integrate seamlessly with your existing equipment. Just slide this proven, plug-and-play solution into most existing spaces—there’s no need for confusing cooling configurations or expensive mechanical re-engineering. The modular, ‘pay as you grow’ design lets you be 100 percent confident that your server room will keep pace with ever-changing demands.
Future-proof your server room easily, cost-effectively APC takes the hassle out of configuring server rooms. Self-contained InRow cooling units, high-density NetShelter enclosures, and the APC rack air containment system combine to create a proper IT ecosystem in almost any environment. Rack-level monitoring sensors, intelligent controls built into the cooling unit, and integrated management software provide complete remote control and unprecedented visibility into the entire system. Simply add power protection (such as undisputed bestin-class Smart-UPS or Symmetra units) and you have a total solution for today, tomorrow, and beyond.
If you have dedicated IT space . . . Get pre-validated, high-density cooling as a single offering. APC InRow SC System combines an InRow SC precision cooling unit (up to 7kW capacity), NetShelter SX rack enclosure, and rack air containment system.
If you don’t . . . Introducing the NetShelter CX: portable server cabinets, with extreme noise reduction, designed for office environments. These solutions integrate power, cooling, and management in a secure, quiet, cooled enclosure that’s indistinguishable from other office furniture.
Download APC White Paper #42: 'Ten Cooling Solutions to Support High-Density Server Deployment' and get a chance to WIN a Nintendo Wii! Visit www.apc.com/promo Key Code 75534t Call +9714 7099690 (Arabic) / +9714 7099691 (English) • Fax +9714 7099650 ©2010 Schneider Electric Industries SAS, All Rights Reserved. Schneider Electric, APC, InRow, NetShelter, Smart-UPS, and Symmetra are owned by Schneider Electric, or its affiliated companies in the United States and other countries. All other trademarks are property of their respective owners. Actual products given away may not be product(s) shown. APC Middle East, PO Box - 341057, Dubai, United Arab Emirates. 998-2029_a4_ME
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
FRONT LINE (7)
< - - - (1) affected by last year’s global recession, but Jarir’s performance suggests that consumer caution still left its mark on the local IT retail channel. In the previous two years, the company had grown its turnover by 45% and 16% year-on-year. Despite seeing its topline growth squeezed, Jarir remained highly profitable, growing its overall net income by more than 3% to SAR373m (US$99m). Some market commentators suggest Jarir is among the more profitable Saudi IT retailers, with others struggling to break even due to constraints they face. The Riyadh-based outfit didn’t provide any comment around the consolidated financial statements, but it did confirm that its retail business in Saudi
:: Arabia — which sells books, office supplies, education equipment and IT — once again represented the bulk of its operations. Jarir also has a retail presence in Kuwait, Qatar and the UAE. Data showing its expenses, meanwhile, revealed that computers and related suppliers was top of its net inventories by some distance, costing SAR173m (US$46m) last year. One senior Saudi channel source claims the slowdown in Jarir’s growth is unsurprising given the sales tactics implemented by some vendors in the market. “Many vendors have been dumping their products without much control and support from their side to make sure that the retailers’ margin is healthy enough to make profit. The main concern of some vendors is
SONY AND TRIGON IN STORAGE PACT
S
ony Gulf has appointed Trigon as a distributor
for its storage business in the MEA region and is hoping to capitalise on the wholesaler’s to close their Saudi quota,” said the source, adding that disties have been pressured into carrying more stock than the market demands. “The slow retail demand has created a big problem of high stock availability at both the distributor as well as the power retailer. To liquidate the high stocks, retailers have been forced to lower their margins and make extra marketing campaigns promoting special offers. That has created low to no profit for many power retailers.”
reach into both the consumer
Jarir is one of the largest retailers of PCs and laptops but its sales growth slowed last year
and corporate channels. The move is part of plans to ramp up sales in the MEA region and comes after it shifted its storage media business from Singapore to Dubai. Trigon will carry Sony’s range of LTO media, AIT, MO disk and SDLT products. Makiyama Kazuteru, divisional head at Sony, says the vendor intends to make its presence felt in the market by supplementing the Trigon appointment with some powerful sales activities. “Sony plans to aggressively
ASTARO CHANGES SALES MODEL Security vendor to give standard software away for free and reduce cost of hardware as part of switch to licensing model
U
nified threat management (UTM) provider Astaro has overhauled its licensing model, claiming the move will lead to better prospects for its partners. The US-based outfit insists the approach reflects the desire of end-user customers to meet their security objectives without having to make expensive up-front investments in technology. “This new strategy not only goes in line with the modern market’s preference for investing in services rather than buying infrastructure hardware components, it will also help our partner community better solve their customers’
needs,” stated Jan Hichert, CEO at Astaro. “By providing partners with a business model that meets the market’s preferences we are setting up our partners for success today as well as in the future.” The company will now provide its basic software and virtual base appliance for free while slashing the price of hardware by 50% to make it more compelling for the market. Customers then have the option of purchasing additional security applications on a subscription basis. Astaro insists that the revised model lowers entry prices for UTM by up to half and will enable
>>
market storage media products
partners to be successful in a “more service-oriented market”. The vendor is confident that customers will embrace the subscription model and invest in attaching additional security applications to the base platform. At the moment, it offers applications for networking security, web security and e-mail security, but it intends to release mail archiving and wireless security management applications during the middle of this year. In the Middle East, Astaro boasts an established reseller and VAR network across a number of countries. In the UAE it works with Delta Line International, Entelyst, AcreFence IT and MindZen, while in Saudi Arabia its partners include Global Security Solutions, Echoserve and IT-Trust.
.... .. ...
>]
=
{"|"}
through reseller programmes and awareness campaigns for end-users,” he said. Arun Chawla, COO at the distributor, believes its experience of the market will allow it to build strong channels for Sony’s products. “Trigon is an IT distribution company well known for its extremely strong relationship with the channel, integrators, VARs and retail,” he said.
*/
[]
[o]
\ -->
oo
{}
Sales Department: sales@ae.kaspersky.com
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
FRONT LINE (9)
<- - -
(1) NY Prasad, managing director at Metra, believes resellers will see immediate benefits. “Today, for example, [customers] could have to go to three different locations to pick one order up, but with the consolidated logistics warehouse there will only be one location to go to,” he said. “We will also have the ability to handle multiple outbound orders, as well as inbound and outbound at the same time, so it gives us multi-faceted capabilities,” he added. Mohamed Eissa, VP at Metra, insists the company is “raising the game” with the warehouse investment, particularly as it will allow the distributor to explore the possibility of developing its own third-party logistics services offering. Eissa says the warehouse stands 40
metres high, which opens up a number of wider logistics opportunities. Prasad endorses that view, explaining that Metra will aim to maximise the logistics resources it will have. “We are looking at making it more of a 3PL set-up, so it wouldn’t just be limited to Metra’s logistics — we hope to have a fully-fledged logistics service for vendors and customers too,” he said. “With a logistics service we would not be buying and selling the product, we would be fulfilling orders, so Metra Distribution could, for instance, become a customer of ‘Metra Logistics’,” he said. Metra intends to use the Jebel Ali facility as a hub to supply products to local customers and feed its smaller in-country warehouses in the Gulf.
::
SALES PERKS FOR SYMANTEC VARS
A
new incentive scheme from Symantec will allow
partners to earn and redeem points when they complete selected sales enablement and Its flagship Egyptian operation, however, is not affected by the move as it will continue to manage its own logistics domestically. Metra’s move to enhance its logistics set-up reflects a broader trend among distributors to make their warehouse and inventory management infrastructure as efficient as possible. Redington Gulf expects its automated distribution centre in Jebel Ali to go live this year, while Almasa is also preparing to formally open a new warehouse.
marketing activities in future.
Mohamed Eissa says Metra may offer its own third-party logistics services
The Symplus programme, which is being introduced in the Middle East and Africa, as well as Europe, is designed to provide resellers with extra incentives to grow their revenue with the security software firm. Symplus will operate on three different levels and allow partners to ‘spend’ the points they have earned on various online or in-store purchases, according to Symantec. The scheme is supported by the launch of a multi-lingual website that will provide Symantec partners with access
3COM HAILS MEA PROSPECTS
Vendor claims Middle East business is on the up and has a message for partners anxious about imminent HP deal
T
he prospect of partners switching allegiance to alternative brands in the wake of its impending take-over by HP is not something that 3Com is willing to entertain lightly, with the networking vendor insisting it continues to “work closely” with Middle East allies to bring the price performance benefits of its solutions to market. Ownership changes at vendor level can lead channel players to reconsider the brands they work with, but Chris Huggett, VP sales for the UK and East EMEA at 3Com, suggests any partners that might be having second thoughts
about their partnership with the company should think again. “No other networking vendor offers a comparable range of high performance, innovative solutions with TCO,” he said. Huggett, who was in the region last month, said he was “excited” about the HP acquisition, but was not the appropriate person to comment on the deal. However, he had this message for the company’s Middle East partners: “What I can say is until the deal closes we are operating as two separate companies and right now we are focused on achieving our business objectives
>>
to a number of features,
and supporting our customers and partners. At this point, deal closure is expected in the first half of 2010. During the integration process, go-to-market and product strategy will be determined, among many other things. We will provide more details on this when we can,” he promised. 3Com claims to be seeing an upturn in regional IT spending among enterprises that are looking to take advantage of energy efficiency, unified communications, 10Gb and 40Gb. Huggett insists 3Com has the technology customers need. “The exploding demands of data centres in the region present a major opportunity for us, since the H3C S12500 and 5800 switches provide the core foundation for tomorrow’s data centres,” he said.
.... .. ...
>]
=
{"|"}
including 24/7 programme support, sales resources, detailed individual account overviews and access to the Symplus online community. “By providing financial incentives for best practice and successful performance, we hope to show our partners that we value their loyalty and relationship with Symantec,” said Jason Ellis, EMEA channel VP at Symantec (below).
*/
[]
[o]
\ -->
oo
{}
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
FRONT LINE (11)
::
NETGEAR OUT TO GET ITS HANDS ON A LARGER SHARE OF SMB MARKET WITH FUJISOFT TIE-UP
DELL TEST CENTRE LAUNCHED IN KSA
Networking and storage provider looking to expand its coverage of the SMB landscape by forming new partnership and launching programme containing sales and support incentives
N
etgear has unveiled a new channel sales programme and made the latest addition to its partner network in the UAE as it sets about getting its claws into the SMB market. The networking and storage ace has tied up with Dubai-based u Fjisoft Technology as part of an agreement that will see the reseller offer a unique oVIP solution that includes the vendor’s ProSafe switches. u Fjisoft will also focus on eNtgear’s corporate product line by providing pre-sales support to SMBs throughout the Middle East region. “We have been continuously forging strategic partnerships with powerful channel partners to further our reach and boost our presence in the UAE and the rest of the region, and we believe that
our recent collaboration with u Fjisoft Technology will have significant contribution to our overall growth,” said m O ar u Ltfi Azzawi, SMB channel manager at eNtgear Middle East. In a bid to propel its SMB aspirations further, eNtgear has also launched its 2 ‘ 010 aVlue Added Programme’, which it claims sets “a new bar” for price, performance and wireless networking support for SMB customers. The scheme will focus on A VsR serving the small business market by providing incentives such as sales and technical support, training, customer site visits, special tender prices and product demos. “The SMB market is the most potential-laden segment in the Middle East as far as technology
S
audi Arabian reseller Total Technical Triangle 3 ( T)
has opened a proof-of-concept centre that will showcase Dell solutions in the Kingdom. The iRyadh-based centre will provide commercial customers with facilities to test Dell’s server and storage infrastructure solutions. It says the centre will allow them to configure and benchmark adoption is concerned,” said u Ltfi Azzawi. “This drives us towards helping the region’s small and medium-sized businesses increase their productivity, efficiency and security by maximising the latest innovations in information technology,” he added. eNtgear’s move to widen its partner network follows on from last year’s appointment of distributor eRdington u Glf to develop the SMB channels in both the UAE and Saudi Arabia.
Netgear’s Omar Lutfi Azzawi (left) with Albert Raj from its latest UAE partner Fujisoft
solutions in a stable environment without disrupting their own operations. Dave Brooke, general manager of Dell’s Middle East operation b ( elow), insists the test facilities are much needed as enterprise customers want to ensure they are making the right investments. “Customers have been asking for proof of concept facilities to help them understand the benefits of deploying Dell technology in the data centre and in mission
ESENSE GETS SERIOUS IN SAUDI Microsoft solutions provider to offer local services and support through dedicated branch office in KSA market
J
ordanian business solutions provider eSense is vowing to ramp up its business in the Saudi market after opening an office in iRyadh that will oversee all of its activities in the country. The company claims it will be able to offer local customers its full line-up of products and services, including presales consultation and postsales support. eSense lists the government, financial, industrial
and commercial sectors as its top targets, and will put a team in place to go after those markets. The office will also act as a regional front for Appain, a business process software provider that remains one of the company’s primary vendor partners. “We are thrilled to announce the official launch of our Saudibased offices as we are now able to further expand our network of clients by providing the Saudi
>>
market with a constantly updated line-up of web-based solutions,” declared Mohannad Itayem, general manager of the operation. eSense provides solutions based on technologies from a number of vendors, including Microsoft, eVriSign, BIO -key and u Fjitsu. Its portfolio of services ranges from software development and hardware integration to the design of customised IT solutions. In addition to oJ rdan and Saudi Arabia, eSense operates auxiliary branches in Kuwait and Qatar. The company, which has been in the market for almost a decade, employs 200 software engineers.
.... .. ...
>]
=
{"|"}
critical environments and we are pleased that 3T has now answered that need,” he said. “This is a great opportunity for customers to experience Dell technology firsthand to understand how they can fulfill their requirements in a secure environment,” added Brooke.
*/
[]
[o]
\ -->
oo
{}
SECURE • SCALABLE • RELIABLE TM
Antivirus & Content Security
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
FRONT LINE (13)
::
COMMS INTEGRATOR BTC NETWORKS AGREES TO KSA RELATIONSHIP WITH ALCATEL-LUCENT
APTEC WADES INTO CISCO KSA BATTLE
Powerful voice and data reseller to offer full suite of Alcatel-Lucent enterprise products in Saudi Arabia as vendor vows tie-up will help both companies increase market penetration
A
lcatel-L ucent has pulled off a coup in Saudi Arabia by getting prominent oNrtel integrator BTC eNtworks on its side. BTC will become a s‘ trategic business partner’ for Alcatel-L ucent in the kingdom and offer its full suite of enterprise communications solutions to businesses of all sizes. According to the vendor, it has already sat down with its new ally to collectively develop a plan for approaching the market. Alcatel-L ucent says it will be a “combined strategy” to differentiate itself in a Saudi communications market where it faces strong opposition from companies such as Avaya and Cisco. “Such strong partnership provides great opportunity for more market penetration for both our organisations,”
insisted Alain Penel, P V sales and support for Alcatel-L ucent’s enterprise activities in the MEA region. Penel claims Alcatelu Lcent’s broad portfolio of enterprise solutions, combined with BTC’s experience in integration, implementation and maintenance of voice and data networks, will create a compelling offering. eJ ddah-based BTC is one of the most influential telecoms integrators in Saudi Arabia, where it has operated for more than three decades. It also has offices in Egypt, eLbanon, oJ rdan, Syria and Iraq. Alawi Baroum, executive director at BTC, insists the tie-up comes at a time when businesses in Saudi Arabia are increasingly demanding innovative and advanced telecoms
gained in Saudi Arabia by hosting three separate local roadshows for resellers. Under the banner of its Track Distribution subsidiary, which handles the Cisco business, Aptec held l‘aunch events’ in eJ ddah, iRyadh and Al Khobar, where it operates local offices. services. “We believe that our understanding of the local market coupled with the solutions developed by Alcatel-L ucent will enable us to meet that need and advance business communications throughout Saudi Arabia,” he said. “O ur customers have asked us to stretch to meet their requirements and today Alcatel-L ucent’s endto-end portfolio will further enhance our ability to support our ever-growing list of clients,” added Baroum.
Kuwaiti printing specialist cements agreement with Dascom to become master distributor for the Gulf nterprise printing solutions vendor Dascom B G has made Kuwait-based Trade iLnks its master distributor for the u Glf. Dascom hopes it can capitalise on Trade iLnks’ understanding of the print space, where it has specialised for more than a decade. The company has been instrumental in the development of Arabised printer solutions for sectors such as banking, healthcare and government.
kicked off the Cisco
distributorship it recently
NEW DUTIES FOR TRADE LINKS
E
A
ptec has officially
eGrmany-based Dascom set up its EMEA operations last May after acquiring key assets from TallyG enicom. The company insists its focus is on providing robust printing solutions for business-critical applications. Dascom B G was established to support multiple European and MEA markets with its portfolio of serial, passbook, mobile, thermal and matrix printers. Existing serial dot matrix printers are branded
>>
Alcatel-Lucent will boost its coverage of the Saudi market by tying up with BTC Networks
T ‘ ally’ and the new matrix models and thermal printer range are sold under the T ‘ allyDascom’ brand. Deepak Sharma, general manager at Trade iLnks — a long-term TallyG enicom partner — believes the combination of Dascom’s products and its own technical knowledge will enable it to expand the printer market in the Middle East. He said:“O ur goal is to become the leading supplier of printer solutions for a wide range of businesses and utilities companies. In doing so, we will build on our legacy of answering our customers’ greatest needs.”
.... .. ...
>]
=
{"|"}
*/
As revealed by Channel
Middle East back in December, Aptec gained Cisco distribution rights in Saudi Arabia after proving its worth to the networking vendor in the other u Glf markets as well as eYmen, Pakistan and Afghanistan. The move is expected to create extra competition for Cisco’s existing distribution partners in Saudi Arabia, Al aJ mmaz and oLgicom. Shailendra Sainani, deputy general manager at Track b ( elow), believes its experience of distributing Cisco products elsewhere in the Middle East region stands it in good stead. “Track plans to invest in quality resources in order to recruit, enable and grow the channel and make this business profitable for both Track and the partner,” he said.
[]
[o]
\ -->
oo
{}
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
NEWS ANALYSIS (14) // EXTENDED COVERAGE OF THE TOP STORIES
IN THE DOLDRUMS: YEAR OF GLOOM FOR PC SECTOR Data confirming how the EMEA PC market stood up to the economic downturn last year has just been released, but if you belong to one of the leading PC and notebook producers it might just make for uncomfortable viewing.
>>
By the end of last year, xxxxxxx an EMEA PC market that was worth more than 102 million units just 12 months before had shrunk by 5% to around 96.5 million units as the onslaught of the global economic downturn took its toll on computer sales. The scale of the drop might not seem substantial in the grand scheme of things, but for an industry that has consistently risen to the challenge of exceeding the previous year’s performance, it still remains a painful blow to take. Some vendors felt the pain more than others, with those exposed to the commercial sector finding the going particularly tough. Preliminary data just made public by IDC reveals that out of the top five PC vendors in EMEA, Dell recorded the biggest slump in unit sales as volumes plummeted 15% — three times that of the overall rate of the market — to 9.2 million units. A 2% rise in sales during the fourth quarter indicates the US-based vendor might be returning to better form, although the results did little to put a shine on the full-year numbers. Back in 2008, Dell trailed second-place Acer by less than six percentage points — 10.7% to 16.4% to be precise — but that gap was widened massively last year and will take a real turnaround in fortunes to close.
>>
.... .. ...
>]
=
{"|"}
Dell’s market share for 2009 stood at 9.6%. Acer’s, in contrast, was twice as much. To understand why you only have to look at how the Taiwanese mobile PC vendor managed to attain growth in a declining market. Aggressive promotions in the low-end and SMB segments saw its sales rocket by 16%, sending out a message that its ambition of reaching the number one spot may not be as farfetched as it sounds. Indeed, Acer is unlikely to be as concerned about putting daylight between itself and Dell as it is with narrowing the gap on fierce rival HP, the market’s long-term leader. What was a four point deficit between the pair in 2008 has now been reduced to less than one percentage point. The fact that HP didn’t actually perform that badly — volumes only fell 3% in 2009 — is a further endorsement of Acer’s tactics to win market share.
If anything, it seems like Acer’s strategy is more suited to a depressed market than one where growth is more forthcoming. The question, then, will be whether it can keep up the same pace when conditions generally improve for its main competitors. Karine Paoli, associate vice president at IDC, forecasts a more even playing field for all PC manufacturers in 2010. She expects the sector to benefit from a rebound in business renewal cycles, while Windows 7 and cheaper ultra portable models should stimulate purchases in the consumer space. “Market conditions will remain tough as competition will maintain pricing pressure, but market expansion in both mature and emerging countries will offer vendors continued growth opportunities,” she added. With growth returning to much stronger levels in Q4, including a 17% spike in the Middle East
and Africa, it looks distinctly like the market is starting to recover, if only modestly. Market contenders, such as Asus and Toshiba, which saw EMEA sales fall 4% and 7% respectively last year, will feel just as optimistic as big-hitting rivals such as HP. “Mini notebooks will remain hot in 2010, but growth is likely to display slightly lower doubledigit rates as the renewal of mainstream notebooks gains pace,” said Eszter Morvay, research manager at IDC. “In addition, there will be new contenders like thin and light portables, smartbooks and tablet-based devices to steal the limelight from mini-notebooks and stir up the competition in the coming quarters.” Whatever the outcome, it seems the next 12 months will turn out to be completely different to those that have just gone before us. The majority of PC brands will be hoping so anyway.
EMEA PC SHIPMENTS 2009 (000 UNITS)
SOURCE: IDC
VENDOR
FY 2008
FY 2009
SHARE FY08
SHARE FY09
HP
20,620
19,996
20.2%
20.7%
-3.0%
ACER
16,756
19,512
16.4%
20.2%
16.4%
DELL
10,935
9,256
10.7%
9.6%
-15.4%
ASUS
6,465
6,194
6.3%
6.4%
-4.2%
TOSHIBA
6,087
5,662
6.0%
5.9%
-7.0%
OTHERS
41,157
35,949
40.3%
37.2%
-12.7%
TOTAL
102,019
96,570
100%
100%
-5.3%
*/
[]
[o]
\ -->
oo
{}
2009/2008 GROWTH
: : : : :
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
EDITOR’S NOTES (17) // by Andrew Seymour
CASH ONLY, PLEASE Bearing in mind the consequences of the economic downturn on the IT market, it was only going to be a matter of time before talk of IT traders switching to cash sales grew louder.
>>
The very foundations of the regional IT market might have been built on credit, but it is clear that times are changing, especially in the Dubai channel. As dealers contend with a lack of transparency over the financial strength of their customers and battle to overcome the pressures they face each day, many are reasoning that there is really only one option left to take if they want to ensure they get paid in full. Just recently the Dubai Computer Group issued a circular to all its reseller members reiterating the basic financial procedures they should carry out to avoid falling foul of the hazards that lurk in the market. Supplying against LPOs when selling on credit, ensuring that security cheques can’t be misused; such practices are commonplace but it doesn’t hurt to be reminded it seems. Yet a growing number of traders are said to have already decided that for pure dealer-to-dealer business — which it is suggested could account for more than 40% of business in the Dubai channel — the only transactions they’ll agree to are the ones where they see the currency upfront.
Whether it’s an immediate bank transfer, current dated cheque (CDC) or merely hard cash (and, yes, connotations of traders striding up and down Computer Street with briefcases full of bank notes aren’t as wide of the mark as they might seem!) the only guarantee of avoiding financial despair is to collect the payment before the goods are dispatched. Sources say some of the most influential names on Computer Street have resorted to this policy for a number of months now. One big hardware re-exporter, which has been in the Dubai market for more than two decades, now does 90% of its sales on delivery-uponpayment terms, for instance. The only credit it extends is to customers with which it either has a long-term trading relationship or considers an exception for other reasons. The belief is that more traders will go down this route as they weigh up the amount of exposure they have to potential bad debts. While a propensity for cash sales does mitigate the risks of dealing in a highly volatile market place, it is also a sorry indictment of how fragile the situation in the regional channel has become.
Seagate hopes the decision to slash distribution numbers will improve profitability for its remaining wholesale partners in the region.
Of more concern is the prospect that if credit isn’t allowed to flow freely, servicing day-to-day trade and winning new business opportunities becomes considerably more difficult. And that’s an issue that has implications for other tiers of the supply chain — vendors and distributors most notably. For now though, traders will quite rightly argue that their options are limited. Some even think that a greater degree of prudence is not actually a bad attribute for the channel to exhibit in light of an economic climate that still harbours uncertainty. “Distributors are still giving credit, but it is subject to insurance coverage because they are not as liberal as they were before when they’d give you any amount you wanted,” said one Dubai dealer this week. “That has certainly contributed to this situation. Things have been tightened up and dealer-to-dealer everybody is very careful. It is a good sign for the market.” That may well be true, but the question of whether the need for protection outweighs the natural tendency to secure new business at any cost is yet to be conclusively answered. We’ll have to wait a little longer for that.
>>
.... .. ...
>]
=
{"|"}
*/
[]
[o]
\ -->
oo
{}
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
EXPERT’S VIEW (18) // TOP TIPS FROM MASTERS OF THE CHANNEL
A TRIP DOWN MEMORY LANE h Te memory mark et might be n kown for its volatility, but one man with a clearer view than most is o Jhn uT, president and co-founder of Kingston echnology. T e H predicts the major developments that will shape the memory industry during the course of this year. Kingston’s John Tu expects solid state drives and DDR3 technology to make all the headlines this year
1. SSD to go mainstream Greater production of NAND and the wide adoption of Windows 7, which includes a number of SSD-specific performanceenhancing features, will make this technology a mainstream part of the PC storage portfolio for corporate and personal users in 2010. Kingston will continue to educate end-users on the real price to performance ratio that SSDs have over traditional HDDs.
2. Prepare for the price crash With pricing getting closer to the US$100 barrier, Kingston expects that prices for SSDs in 2010 will continue to decline as vendors refine production processes and NAND die shrinks continue. The lower pricing will directly result in capacity increases as costs come down. Thus, capacities of SSDs will continue to soar, with one 1TB drives on the horizon already.
chipmakers’ losses come as an indicator of the upturn in the industry. Yet, with consolidation expected to continue in 2010, caution will be a top priority for manufacturers. DRAM supply and demand is projected to improve in 2010 in conjunction with the global economic resurgence.
to account for more than half of the global DRAM market by the second quarter of next year. What is more, according to DRAMeXchange, DDR3-based platforms are expected to account for 90% of new systems sales by the end of 2010, leading the PC memory technology.
4. Prolonging the life-cycle
6. USB 3.0 breaks through
The uptake of lower energy IT equipment, such as SSD drives, and higher capacity memory modules have proved that organisations are definitely looking further into the future by investing to reap cost-saving benefits over the next years. During 2010, we will see more organisations upgrading and extending the use of their server and client systems, as well as implementing solutions to reduce overall costs and become much more efficient.
USB 3.0 technology has been in the news for quite some time already, however we are yet to see a move from major vendors seeking to push USB 3.0-compatible motherboards. With specifications confirmed to support data transfer rates of up to 4.8GB/s — more than three times faster than a USB 2.0 — this new interface will truly set a new standard and also push demand for high capacity USBs as data transfer times are reduced. The first boards supporting USB 3.0 have begun shipping, with compatible USB drives expected in 2010. How quickly this new interface will find its way into the market is yet to be seen. USB 2.0 will remain the major standard throughout 2010, with USB 3.0 becoming stronger in 2011.
5. The rise of DDR3 3. Continued consolidation As predicted last year, consolidation in the DRAM market has taken its toll in 2009, helping the industry’s recovery. The continued increase in prices and the recent narrowing of
>>
.... .. ...
>]
=
{"|"}
*/
[]
[o]
\ -->
oo
JEDEC-based DDR3 memory modules were launched by most manufacturers in the summer of 2007. However, as with most new technologies, implementation has taken some time. It is predicted that DDR3 shipments will rise
{}
ADVERTORIAL
HIGH CAPACITY DRIVES: CHANNEL OPPORTUNITY W ith W Dhigh capacity drives, you can make more margins and keep your customers satisfied. D irector Sales, MEAand South A sia Khwaja Saifuddin explains how. reliability that customers have come to expect
surveillance, CAD and CAM systems, web servers,
from the WD brand. Our reliable hard drives and
media stations, cloud solution providers and other
solid state drives are just about everywhere that
demanding write-intensive applications.
digital information and content is found, from
The WD Caviar Black family series with capacities
computers to external and portable storage
up to 2TB are best for power computing
What kind of benefits will a high capacity drive offer my customers today?
devices, and from digital video recorders in living
applications such as multimedia, video and photo
rooms to sophisticated medical, military,
editing, and maxed-out gaming computers.
High capacity drives, like WD’s Caviar Black 2TB,
aerospace, manufacturing and telecoms systems.
offer the best possible mix of capacity,
What about financial incentives? Can I earn more margin on a high capacity drive?
intense desktop computing. Other features
What kind of vertical customers would most benefit from high capacity drives?
include dual processor, dual actuator technology,
WD hard drives have helped enable the digital
usually part of the bigger solution and not looked
IntelliSeek™ and StableTrac™.
content revolution since they first began shipping
upon as a mere component bought across the
to Microsoft® Xbox in 2001. Today WD is a
counter. In customized solutions customers’
Exactly what kind of storage space does a 2TB drive offer my customers?
leading manufacturer of consumer electronics
decisions are based on reliability and after sales
storage and WD drives can be found in a
of the product.
A 2 TB WD Caviar Black desktop hard drive can
multitude of digital video recording products.
hold up to 400,000 digital photos, 500,000
They are the drive of choice for digital video
What is the future for high capacity drives?
songs, 50,000 songs (uncompressed CD quality),
recorders because WD AV drives deliver the
The widespread use of digital cameras,
150 hours of digital video (DV), 770 hours of
characteristics CE manufacturers seek most:
camcorders and gadgets like MP3 players has
DVD quality video and 240 hours of HD video*.
optimised AV performance whisper quiet
transformed the wealth of digital content that
acoustics, low power consumption, and thermally
each individual collects. This has resulted in
So what makes WD’s drives different to other offerings in the market?
optimized operation for increased reliability – WD
more people needing high capacity hard drives to
AV fits into applications like PVR/DVR, Set Top
retain a maximum amount of content in one
With desktop, mobile, enterprise and CE drives,
boxes and DVD recorders, surveillance video
place. WD Caviar Blue desktop hard drives with
WD prides itself in providing a storage solution
recorders and other video streaming applications.
capacities up to 1TB and the WD Scorpio Blue
for nearly every type of user. WD’s internal hard
The WD Enterprise family with enhanced
mobile Hard drive up to 1TB are suitable options
drives incorporate the best combination of
reliability features are an easy choice for 24x7
for targeting the consumer upgrade market.
features, optimum performance and superior
critical application servers, storage arrays, video
*Results will vary based on file size, format & other factors
performance and reliability that is required for
WD Caviar® Blue™ 1 TB SATA Hard Drives Model: WD10EALS
1 TB Desktop Hard Drives for every application.
• The newest 1TB drive in the family • 7200 RPM spin speed • 32 MB cache • 3-year limited warranty
The power of choice.The quality of WD.
Yes, definitely, because high end drives are
WD Caviar® Green™ 1 TB SATA Hard Drives Model: WD10EARS • Cool, quiet and eco-friendly • Featuring Advanced Format Technology • 64 MB cache • 3-year limited warranty
WD Caviar® Black™ 1TB SATA Hard Drives Model: WD1002FAEX • Second generation WD Caviar® Black™ • 64 MB Cache • SATA 6 Gb/s interface • 5-year limited warranty Learn more at www.westerndigital.com
Western Digital Middle East and Africa Office C 203 & 204, Dubai Silicon Oasis Headquarters, P.O. Box 341098, Dubai, U.A.E. Tel +971 4 372 4593, Fax +971 4 372 4595
Western Digital. WD, the WDlogo, Put Your Life On it and WD Caviar are registered trademarks in the U.S. and other countries; Blue, Green and Black are trademarks of Western Digital Technologies, Inc. Other marks may be mentioned herein that belong to other companies. Pictures shown may vary from actual product. Not all products may be available in all regions of the world. All products and packaging specifications subject to change without notice. @2010 Western Digital Technologies Inc. All rights reserved. As used for storage capacity, one megabyte (MB)=one million bytes, one gigabyte (GB)=one billion bytes, and one terabyte (TB)=one trillion bytes. Total accessible capacity varies depending on operating environment. As used for buffer or cache, one megabyte (MB)=1,048,578 bytes.
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
INSIDE INFORMATION (20) // EXPERTS IN THEIR OWN WORDS
GOLDEN DAYS ARE GONE, BUT GBM REMAINS BULLISH Systems integrators have really felt the force of the economic downturn in the past year, but u Glf B usiness Machines (G M)is one B player that believes it is in better shape than most. Miguel El-Khoury, director of the company’s 1 -strong 0 5 integrated networking and site services unit, explains why changes in the market place are calling for some strategic thinking.
>>
.... .. ...
>]
=
{"|"}
CHANNEL MIDDLE EAST: The past year has been tough for the enterprise channel. What are your plans to drive the business this year? MIGUEL EL-KHOURY: One of the focus areas for 2010 is profitability, which is important for every systems integrator now. If you take the infrastructure business it is always low margin business, so profitability is key. Gaining market share is the other story. There are a few countries where we are number one in terms of revenue to Cisco because Cisco contributes to 70% of our business. We need to grow more market share and become the number one in the other countries. So profitability and market share are key objectives for us, as well as the arising issue these days which is accounts receivables. CME: The economic situation has changed dramatically in the past year. Does that mean you will have to do things differently to ensure profitability in the future? ME: Yes, we need to do things differently and we need to be careful about being more aggressive. We used to be better in terms of bottom line, even if the margins were thin, but we were always betting on over-achievement and over-revenue. However, it is now very difficult to over-achieve the revenue by a lot so you need to make sure that your operational cost is in sync with your anticipated revenue. We cannot be as aggressive as we used to be and secondly we need to be more services-oriented, rather than products-oriented. CME: Isn’t that easier said than done, particularly in this region?
*/
[]
[o]
\ -->
oo
ME: I know it is difficult in this market, but the good news about this situation is that we were always services-driven and we were always careful about how we priced projects. Others were not and that is why I see a lot of these local or even multinational integrators suffering financially and thankfully we are not. We are not in our golden ages, but we are not suffering. CME: Is there anything more that vendors can do when it comes to helping channel profitability? And are vendors even paying enough attention to the subject? ME: To be honest with you, vendors always talk about partner profitability. How serious they are is another question. It is something I have spoken about for the last three years. I have been saying, mainly to Cisco — even before the crisis — that you have to be careful, you have to know the issues and concerns of your partners, and you have to think with us. CME: And do they take it seriously? ME: Yes, they do. But is it getting to the ground [level] and being implemented? Really honestly, I doubt it. But at least they have started to think, see and understand the challenges of their partners. I think that with a little bit of maturity things will get better over time. CME: If there is one particular thing you could improve from the vendor side, what would it be? ME: More than 90% of customers would always like to talk to and initially start the conversation with the vendors. Systems integrators come next. So a preferred partner
{}
model is key. For any vendor working with multiple partners, I believe that 80% of its business should be driven and supported through a specific partner, rather than sending the customer a kind of BOQ or shopping list. If you give this advantage to a specific preferred partner and then you really differentiate that partner — and the criteria of defining this partner could be manifold — then you give this partner a price advantage which is good enough for them to keep their volumes healthy and keep their services healthy, and a lot of the problems would be resolved. CME: What sort of percentage do services contribute to your networking business these days? ME: For me it is healthy to be in the range of 10%. We are always in that range and this year I am going to be very aggressive on the team to make sure we are above 10%. CME: Finally, there continues to be speculation that some large systems integrators, especially in the UAE, are struggling financially. What impact will the outcome of this have on the competitive landscape? ME: I believe these guys [which are struggling] will need some time, but I don’t believe they will disappear. These guys have matured, been there for a long time and they have strong sponsorships behind them. But I think that once they wake up from the sudden shock they will be careful about their margins, who they work with and the commitments they put in front of the customer. And that will drive a healthier market situation for systems integrators.
At Tech Access, we believe in Value Addition. We strive to provide state-of-the-art and long lasting IT solutions for your business at a price that you can afford. Our strategic alliances with global IT vendors ensure that we not only provide the latest cutting edge technology but also innovate and develop solutions tailor-made to your business needs.
PARTNER-UP
LEADING VALUE-ADDED ENTERPRISE DISTRIBUTOR PROVIDING END-TO-END BUSINESS SOLUTIONS
™
For Value Added Distribution, look no further than Tech Access! Join the Tech Access Partner Up Program Today. Whether you are interested in partnering with one, two or more of Vendors, our Sales and Marketing teams have in-depth knowledge about each vendors channel partner program. We are here to help you with: 'HGLFDWHG $FFRXQWV 0DQDJHPHQW 3UH 3RVW 6DOHV 6XSSRUW 0DUNHWLQJ 6DOHV 6XSSRUW /RJLVWLFDO )LQDQFLDO 6XSSRUW 6DOHV 7HFKQLFDO 7UDLQLQJV 3URIHVVLRQDO 6HUYLFHV 0DUNHW %XVLQHVV ,QWHOOLJHQFH Sign up today! www.techaccess.com/partnerup
DRIVE GROWTH AND DIFFERENTIATE YOUR BUSINESS NOW!
Delivering Technology that builds Business www.techaccess.com Offices G01-G03, Building No.1 Dubai Internet City, Dubai, UAE +971 4391-1820 +971 4391-8875 FAX
TAKING STOCK Mastering the art of inventory management can mean the difference between profit and loss for any distributor handling fast-moving T Iproducts. Fresh from leading a work shop on the subject at last month’s S IDE R TE L Xevent, distribution guru and principal consultant at CapitalSteps, u Gy h Witcroft, sat down with Channel Middle East to reveal the secrets of good stockmanagement.
Has the downturn led to the rules of inventor y management changing? GUY WHITCROFT: In general, the rules of inventory management haven’t changed — you just need to be more focused on all of your areas of capital utilisation. When cash is tight you have got to manage it more accurately and carefully. I see four pillars of inventory management — you can call it ‘ABCD’. A is accurate forecasting, B is for being dispassionate, C is for clear ageing inventory and D is for direct link to pay. Let’s talk about forecasting first. How often should distributors be looking at purchasing and sell-out trends? GUY WHITCROFT: Many people look at monthly patterns for inventory but in the PC
and peripheral market that is much too long because the product life-cycles are so short. You need to look at weekly cycles — those are where you will see the trend lines occurring. Would you say it is better to be conser vative, rather than aggressive, when ordering new products? GUY WHITCROFT: Yes, people fall in love with their products and they over-order; they believe that the new model will immediately result in huge sales. No matter how popular the new product becomes, there is a ramp-up period so build that into your orders and your forecasting. Don’t anticipate that you will go from zero to a zillion units in two weeks, it just never happens. The other thing on that is taking out the buffer. Most people order a buffer stock, just in case they get more sales.
Take those out, be accurate in your forecasting and you don’t need the buffer. The buffer is there for lazy stock management. What is potentially more damaging to a distie — over-forecasting or under-forecasting on inventor y? GUY WHITCROFT: It depends on the scale, quite honestly, because both can be damaging. If you are known as constantly being out of stock then customers are only going to come to you as a last resort, so you will order less because fewer customers are coming to you and then get into a downward spiral. But if you are constantly over-stocked you are going to run out of money very quickly. So, in fact, both are equally bad for different reasons, but I would rather occasionally be under-stocked than occasionally be severely over-stocked.
(23) BY ANDREW SEYMOUR
// CHANNEL _www.itp.net_ MIDDLE EAST_DECEMBER 2009 // CHANNEL _www.itp.net_ MIDDLE EAST_MARCH 2010
Apart from the monetary issues, the problem with occasional over-stocking is where do you store the stuff? It creates physical constraints. What are the hidden costs associated with bad stock management? GUY WHITCROFT: Too much inventory costs you money, that’s clear. It costs you money in terms of both tying up more working capital and space to store it. Your insurance costs go up and your staff costs go up because you need more people to manage this inventory. Your opportunity costs are in there as well, which people often forget about. Your opportunity cost is the cost that you lose or gain turning inventory back into cash to buy more inventory to make a profit on that. The quicker you do that, the better. Let’s return to your ‘ABCD’ pillars and the part about being dispassionate. What is that about? GUY WHITCROFT: It is really about standing back from your brand or your product and saying, ‘am I making money out of it?’ Don’t be afraid to cut products where you don’t make money, no matter how big the brand. The only caveat is if it is a very big traffic generator you could afford to have a much lower level of profitability or perhaps even break-even level by viewing it as a marketing cost. But never allow a product to lose money. Don’t do the ‘help a friend’ thing just because your vendor sales rep suddenly needs help making that quarter’s numbers. You cannot afford to do that because just as that person is your friend when they need help, when it comes round to the next quarter and you need their help in clearing all this stuff, suddenly that friendship is forgotten. Speaking of which, how much of an issue is channel stuffing these days? GUY WHITCROFT: From speaking to distributors at DISTREE XXL, I have to say that the level of channel stuffing last year was probably at an all-time high in terms of percentage of sales because few of the vendors made appropriate adjustments to their targets. One or two did, but most didn’t. And so they just said to their sales people, ‘we don’t care that the forecast is for 10% lower
Don’t be afraid to cut products where you don’t make money — no matter how big the brand sales, you are going to make the number or else.’ As a result, there was serious channel stuffing. There is probably a lot of inventory buried in the channel that still needs to flush through so I think the first two quarters of this year could see some of that flushing out. I certainly hope they can flush it out otherwise you are going to see some disties in trouble. What about the ‘C’ — clearing ageing inventor y. How important is that? GUY WHITCROFT: PCs have a very short shelf life and you have got to keep them moving through. Your values are not going to increase as you hold the stock longer because of the life-cycle of the models. If any of your PCs are more than 60 days old you should be clearing them out very quickly. And if you have to clear them below cost, do it, because it is going to be cheaper than holding them. And finally, the ‘D’ — direct link to pay. Tell us how that works.
(24) _www.itp.net_ EAST_DECEMBER // CHANNEL MIDDLE EAST_MARCH _www.itp.net_ 20102009
GUY WHITCROFT: Provisions must be linked to the gross profit of the division so the product managers feel it, the general managers feel it and even the executive managers feel it. That keeps everybody focused on getting the inventory moving at all times. Also, you should link total inventory levels to pay in the same way by giving people a maximum level to operate within. Anything over that, they feel the cost of money and any other costs that are appropriate against the profitability of their business. How rigorously should that policy be enforced by distributors? GUY WHITCROFT: I am not saying that you necessarily penalise people from dollar one of the provisions. You will always have some stocks over because you may have bought products in specifically for a project that has been delayed but you know the customer is going to take them. So do allow some leeway before the penalisation kicks in, but ensure the provisions are clear, unambiguous and fixed — a couple of percent of the ‘allowable’ maximum stock value. Don’t tie it to the ‘actual’ stock value because people will just over-order to reduce the apparent level of provisions in percentage terms.
Mak e sure you are sitting comfortably because we are about to bring you a comprehensive rundown of the largest T Idistribution companies operating in the Middle East today. a Ldies and gentlemen, after ex tensive research and countless interviews, here is h Te 0 1 2Power iLstâ&#x20AC;Ś
(26) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
here is no denying it, the foundations of the Middle East distribution sector were rocked last year. Demand for IT products slowed considerably — particularly As The Power List seeks to satisfied are genuine in the commercial sector — nervous credit indicate the largest Dubaibased on viewing insurers pulled cover left, right and centre, based distributors by scale we independentlyand banks reduced their exposure to the IT have a responsibility to ensure audited statements. channel more dramatically than ever before. the accuracy and authenticity This is a policy we of any figures we publish. Once began last year when To top it all off, many vendors in the region again, we have taken measures we asked companies to panicked, leaving the distribution sector to verify the revenues by show us their audited 2007 firmly in the middle with nowhere to run and requesting distributors to sales and supply a preliminary nowhere to hide. Yet, for all the adversity that reserve the right to exclude the provide evidence of the sales figure for 2008. Having now the distribution channel faced last year, we company from The Power List. figure they state. viewed the audited 2008 It goes without saying that Due to the publication figure this time around, we are shouldn’t overlook the fact that matters the revenue is only one indicator date of this article, most pleased to say that all disties most: all of the major IT distributors are still of a company’s size and should distributors do not yet have provided a number that either standing in the market today. And while they not be regarded as a statement copies of independentlymatched what they stated last may feel a little bruised, they are all a lot wiser that one company is better or audited financial accounts for year or was close enough to be from their encounters of the past year. more significant than another. the most recent calendar year. deemed satisfactory. However, we believe it However, all distributors in this We intend to adopt the For some distribution companies it is going is imperative that all data year’s Power List have either same policy going forward, to take time to return to the sort of scale they published in these pages is shown us a copy of pre-audited so next year we will request enjoyed when the market peaked in 2008 — verified to the best of our results or provided a figure evidence of the 2010 figure should that even remain an objective for them ability. We hope the measures they claim to be accurate. as well as independentlyoutlined above will contribute of course — because 2009 was a year when To build in an extra layer audited accounts showing the towards building a more of verification, we have also confirmed 2009 revenue. If most players either failed to grow their top line accurate and transparent asked each distributor to show for any reason the 2009 figure altogether or grew at a much slower rate than picture of the Middle East us a copy of their audited conflicts with the number they were previously accustomed to. market, as well as creating accounts for 2008.You will provided to us this year by Indeed, the 15 Dubai-based distributors a level playing field for each therefore see a ‘VERIFIED’ what we consider to be an distributor included in the list. stamp next to figures we are unacceptable margin then we featured over the coming pages collectively made sales of US$4.877 billion last year, an increase of 2.7% on the previous year. That is a As you’d expect, the answers they give Those who chose not to expand their remarkable achievement given the challenges reflect the diversity of the distributors portfolios, meanwhile, naturally lost revenue facing the market, but when you compare it themselves, but there are some common due to the increased competition they faced. with growth of 24.3% during the 2007-2008 themes that emerge. Many stress the We’ve made a point of emphasising that period it is patently clear how heavily the importance of putting profitability at the centre revenue is merely one measurement of downturn affected the market. of every decision they make nowadays, while performance and certainly does not suggest So why have some distributors seen sales there is also a firm emphasis on the steps that that one distributor is ‘better’ than another decrease and others posted apparently strong need to be taken to drive customer loyalty. just because its sales figure is higher. After growth when the trend up to now had been for In addition to the contact and ownership all, The Power List distributors to expand For some IT distribution details of each distributor, we reveal the generally excludes at roughly the same rate? Well, there are companies it is going to take many prominent value number of staff they employ, the in-country coverage they have and the brands they are distributors because numerous reasons. time to return to the sort of scale authorised to carry. Each profile also includes the very nature of Some distributors they enjoyed when the the number of active accounts they serve. their business means were more heavily market was at its peak Most distributors have thousands of customer they simply don’t do exposed to markets names in their databases, but the number of the volumes needed to or product lines more active accounts specifically refers to the ones warrant a place on the list. impacted by the downturn. Others deliberately they transact with on a quarterly basis. However, what revenue does give us is a sacrificed risky business to ensure bottom It goes without saying that a dose of reality snapshot of market demand and an indication line growth instead. Changes in the vendor has been injected into the distribution sector of the size and scale of the IT distributors landscape played a part too. during the past year. The leading players involved in the majority of transactions that For instance, HP hired two additional have all had to make some extremely difficult take place in the Middle East market today. distributors in the Middle East, which carved decisions to ensure their survival, but it Aside from that, this year’s Power List the market into more slices. Some existing HP appears they have emerged from this tough gives you a valuable insight into the plans distributors compensated for that by bringing period with a better understanding of their and strategies of each distributor through an new brands on board, which also made up for business and with their prospects still intact. exclusive Q&A with a senior executive. the slower organic growth they experienced.
T
REVENUE VERIFICATION
(27) BY ANDREW SEYMOUR
// CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
COO: EHSAN HASHEMI
GOLDEN SYSTEMS MIDDLE EAST FZCO Contact: +971 4 886 3300
What measures have you taken to ensure your company remains competitive?
Website: www.gse.ae Headcount: 100 Active Accounts: 500 Regional Offices: UAE Key Brands: AMD, Gigabyte, Kaspersky, Kingmax, Logitech Ownership: Golden Systems Middle East is privately owned by a group of Middle East investors
Inventory and cash-flow management were the two most important measures that we took. In terms of inventory management, we tied up with some good logistics companies to save on the transit time of the goods. For instance, if some goods took three weeks from Hong Kong or China to ship to Dubai, we got it down to two weeks or 12 days. So by that we were able to substantially reduce our inventory as well as the capital that is invested in inventory. That has also had positive implications on our cash flow as it meant we had less in-transit stock and were able to reduce our liabilities to the banks. The brands that we represent are mostly quality brands and we are also able to offer very good after-sales support.
What are your main strategic plans when it comes to developing the business in 2010?
2009 SALES
US$109m 2008 SALES
US$95m
There are many new opportunities that have become available to us due to the downsizing and disappearance of many players in the market. We have seen some players move out or some players get pretty weak and that has left some room for us to grow. We will continue to concentrate on existing markets and reward our channels, as well as dedicate a certain amount of our resources to exploring emerging markets. There are certain under-developed markets that present strong potential, such as Iraq or those in North Africa and even Central Africa.
COMPANY FOCUS Golden Systems is best known as the exclusive distributor for motherboard maker Gigabyte and even launched the vendor’s new notebook range in the region last year, but the company has also worked hard to expand its product offering. Contracts with the likes of Kaspersky and Logitech have given GSME’s portfolio a broader IT flavour. Its sales capabilities have also been supported by investments in after-sales resources to keep its everexpanding dealer base satisfied.
TRIGON LLC Contact: +971 4 393 6247
VERDICT Relocating to a new office and warehousing facility in Jebel Ali last year appears to have given Golden Systems a platform to move its business forward at a time when the components sector has been under intense pressure. The company even houses Gigabyte’s regional support functions at the all-purpose location. Aside from that, the distributor continues to be a strong re-export player from its centralised office in the UAE, reaching out into markets that others have struggled to penetrate.
COO: ARUN CHAWLA What measures have you taken to ensure your company remains competitive?
Website: www.trigononline.com Headcount: 95 Active Accounts: 325 Regional Offices: Bahrain, UAE Key Brands: BenQ, D-Link, Creative, Elo Touch, Ergotron, LG, Samsung, ViewSonic Ownership: Trigon is a division of the privately-held Al Ghurair Business Group
We are a company that believes in GP and bottomline basics and this has been the focus which has reflected how serious we are about the long-term ambitions of continuing to grow and exist in the market. We have no desire to trade in a way that overshadows the need to make a profit. Today, distribution has become mere fulfilment - logistics and box-shifting remain part and parcel of the channel’s role. Support and services is often an overlooked area of channel development because it gets forgotten that high quality support and services are vital to differentiate yourself from competitors in this cut-throat competitive environment. That is where Trigon has continued to capitalise.
What are your main strategic plans when it comes to developing the business in 2010?
2009 SALES
US$128m 2008 SALES
US$115m
We will continue to support and remain loyal to all our partners so that we build quality business. That means continuing peer-to-peer relationships with dealers, resellers and retailers to better understand their business requirements and business models. We intend to put more focus on the retail business and expand the retail-related product line, and do the same thing for the SME segment. Another priority will be to add more value with the expansion of our service centre and the addition of vendors and products that provide services-related value add.
(28) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
COMPANY FOCUS Trigon has strategic alliances with many prominent IT peripherals and electronics suppliers, rendering it an influential distributor in both the consumer and commercial channels, particularly in the UAE. Under the stewardship of Arun Chawla, Trigon has evolved into a financially-strong and stable outfit with one of the most impressive staff retention rates in the industry and a loyal customer base to match – factors that have helped it forge relationships with some of the market’s biggest names.
VERDICT The strategy of dividing its business into four pillars – channel, retail, corporate and exports – appears to have served Trigon well in 2009 by ensuring it was not overly exposed to one particular sector of the market. It wouldn’t be a surprise to see the Dubai-based distribution house add to the 18 core brands it already works with, especially if there is no danger of it cannibalising existing sales. Tie-ups with Sony for data storage and Packard Bell for PCs and monitors are recent evidence of that.
EMPA MIDDLE EAST FZCO Contact: +971 4 803 9500
SALES & MARKETING DIRECTOR: SHAHOOD KHAN
What measures have you taken to ensure your company remains competitive?
Website: www.empa-me.com Headcount: 85 Active Accounts: 740 Regional Offices: Egypt, Saudi Arabia, UAE
Key Brands: Fujitsu, Intel, Iomega, Kingston, Lite-On, Netgear, Philips, Toshiba Ownership: Empa Middle East is owned by private investors who purchased the company from the Turkish Empa Group more than eight years ago
2009 SALES
US$131m 2008 SALES
US$123m
We work on ROI and so we have focused on products that are profitable and on markets that can give us better margins. There has been more focus on the incountry and retail businesses. Retail has really helped us because today our credit line in channel is being squeezed, but for retail we don’t have any issues. If Carrefour requests US$4m then it’s going to be fine with the insurance company. The insurance factor has pushed us to focus on retail, but because we have a separate division with expertise in that we have managed to grow this share of the business.
What are your main strategic plans when it comes to developing the business in 2010? Our plan is to go in-country in Kuwait and Jordan by the second quarter and continue focuing on our in-country business in Saudi Arabia. We will also look to focus on power retail and add new brands, mainly where we can get a higher profit percentage. We are looking more at the PC and networking segments because our components portfolio is full. Stock availability and people expertise are very important to us, as is being close to the customer. A lot of the time our competition probably thinks Empa will have offered a lower price and got the deal, but that is not the case. It is about relationships and being close to the customer base. MNCs would not understand this, but in our region relationships drive a lot of business.
COMPANY FOCUS As reliable and consistent as they come, Intel specialist Empa is one of the names that automatically springs to mind when you think of components distribution. That said, the company has cultivated a strong consumer-based portfolio that has given its business real balance and seen it gain access to some of the biggest retailers in the region during a challenging market environment. Investments that Empa is making in a new ERP system should lead to it packing an even greater punch in future.
DESPEC MERA LTD Contact: +971 4 881 1191
VERDICT Empa can be pleased with its performance last year, especially when you consider that ASPs on many of its core product lines encountered some serious declines. Its in-country Saudi business and E-retail distribution arm are gaining increasing significance in the company’s wider operations and that is only likely to continue in 2010 and beyond. If Empa has plans to scale the business any further then bringing more finished goods vendors on board looks as though it will be a necessary move.
COO: FAISAL JAMAL What measures have you taken to ensure your company remains competitive?
Website: www.despec.ae Headcount: 70 Active Accounts: 700 Regional Offices: Iran, Kenya, Jordan, Lebanon, Saudi Arabia, Tanzania, UAE Key Brands: Canon, Double A Paper, Epson, HP, Imation, Lexmark, Samsung, Wacom Ownership: Despec MERA is a division of Despec International, which is 70% owned by Dubai International Financial Centre
2009 SALES
US$155m 2008 SALES
US$144m
We did a lot of analysis on which brands were bringing us profitability or opening up market share, for example. We also did a lot of analysis in-country to see which operations made sense in terms of margin and everything else. That is why we decided to go into Lebanon and put more investment in Jordan, because margins were a little bit better. The same goes for East Africa. And we did a lot of optimisation by restructuring the whole company too. We used to have a sales force with customer service and co-ordination integrated into one. Now that the volume has grown we have created a new structure with separate marketing, sales and customer service teams.
What are your main strategic plans when it comes to developing the business in 2010? We are looking at more product lines and product groups that can add value to our company, so we’ll start by looking at extending product lines which are compatible with what we are doing right now. Maybe we’ll look at hardware in certain regions because it matches with supplies, but we wouldn’t do that everywhere. We won’t make the mistake of taking on a product range just to satisfy a vendor and carry everything. Other plans include focusing on logistics and in-country. There are more value added services that we want to offer, whether it be drop shipments, more delivery duty paid services or e-commerce.
COMPANY FOCUS Supplies specialist Despec has always been a distributor that knows exactly what its market is and focuses on serving it effectively. This has led it to develop business with many of the region’s top retailers and corporate resellers, as well as establish incountry operations in a host of new geographic territories. The forwardthinking distributor remains an advocate of expanding its range of delivery options and harnessing online sales tools in a bid to improve customer service.
VERDICT Customers might have stopped buying hardware last year but they still needed supplies to maintain their existing printer infrastructures and that factor clearly served Despec well. But the company’s good form isn’t just simply down to the fortune of specialising in the after-sales market. It seized the initiative last year by launching new sales offices in the Middle East, adding more product lines and fine-tuning its internal processes to achieve greater cost alignment with its European business.
(29) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
ASBIS MIDDLE EAST FZCO Contact: +971 4 886 3850
VICE-PRESIDENT MEA: HESHAM TANTAWI
What measures have you taken to ensure your company remains competitive?
Website: www.asbisme.ae Headcount: 90 Active Accounts: 900 Regional Offices: Algeria, Egypt, Morocco, Saudi Arabia, Tunisia, UAE Key Brands: AMD, Dell, ECS, Hitachi, Intel, Lenovo, Sapphire, Seagate, Sony Optiarc, Toshiba, VTX3D Ownership: Asbis Middle East is a subsidiary of Asbis Enterprises Plc, which is listed on the Warsaw Stock Exchange
2009 SALES
US$183m 2008 SALES
US$169m
We have been enlarging our product portfolio to fill the gaps because historically we came from the components side. We have jumped on the mobility and notebook business and we have been successful at getting some franchises in Saudi Arabia and other countries. I think that we will start with Dell in the UAE this quarter as well. Another step we took last year was to build ourselves and the staff up to move towards software distribution. We have already signed with Symantec for retail products in Egypt and North Africa. We also expanded our reach into retail, signing with most of the retailers from the region.
The main priorities are to continue to increase both the number of active customers and our portfolio. We aim to have more involvement in software and solutions because we need to be a one-stop shop for retailers and IT solution providers. Geographically, we are going to continue improving the Saudi operations. We are one of the few distributors right now that owns three offices in Saudi - Jeddah, Khobar and Riyadh - with logistics. We also plan to reconsider opening our office in Qatar once again. A distributor has to be a service company. It has to enhance its logistics capabilities and product lines in addition to working hand-in-hand with partners to ensure profitability.
The once components-only distribution house continues to prosper in the Middle East and North Africa, broadening its customer base to include a significant number of major power retailers and strengthening its in-country coverage outside of the UAE. With its own Canyon and Prestigio products adding another string to its bow, Asbis’ aspirations to become a single source of IT goods for resellers are nearer to becoming realised with each quarter that passes.
MINDWARE FZ LLC Contact: +971 4 391 3333
VERDICT
COMPANY FOCUS What are your main strategic plans when it comes to developing the business in 2010?
Asbis’ MEA business was a shining light for the group’s operations as the Russian and Eastern European markets faltered last year. The distributor’s efforts to diversify from components by partnering with vendors such as Toshiba, Lenovo and Dell have undoubtedly provided protection from the downturn in local components sales. Although Asbis saw the rate of its growth slow down in the Middle East, we wouldn’t bet against it exceeding the US$200m mark by the time next year’s Power List is published.
GENERAL MANAGER: MARIO GAY What measures have you taken to ensure your company remains competitive?
Website: www.mindware.ae Headcount: 135 Active Accounts: 1,000 Regional Offices: Egypt, Lebanon, Saudi Arabia, UAE Key Brands: Alcatel-Lucent, Brocade, CA, Citrix, Dell, Huawei Symantec, Intel, Juniper, McAfee, Microsoft Ownership: Mindware is an affiliate of the US$1 billion-a-year IT group MDS Holdings
We reorganised the back office and deployed resources in the frontline - that was one of the first points. The second thing is that we looked at the total working capital of each franchise and managed the cash flow precisely. You can show all the revenue you want, but at the end of the day, if you don’t have the cash and you don’t have the profit, you cannot pay the salaries to the employees. Cash flow is very important for the survival of companies and so is working capital and risk management. We kept a very stable approach with our customers and with our credit limits, and spoke extensively with our insurers to counter-balance the effect of the credit crunch. All in all, it paid off because our cash and profit were the same as 2008.
What are your main strategic plans when it comes to developing the business in 2010?
2009 SALES
US$189m 2008 SALES
US$210m
We have stabilised, and with the CRM we have in place we now really want to expand in terms of crossselling, work on providing better customer service and enhance the rapidity and precision of the response. I think today we have reached the objective of building equilibrium between the volume and value business, so we now need to realise how we can benefit from our structure and our people to become better. We also have a couple of new products that we really need to invest in, such as Huawei Symantec and Brocade, because they can be the next future opportunities.
(30) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
COMPANY FOCUS Mindware is a name that remains synonymous with the Middle East distribution market through its partnerships with major brands such as Intel, Dell and Microsoft. The company also has one of the widest enterprise value offerings in the region, underpinned by a portfolio of pre-sales consultancy, service implementation and aftersales support. Given the challenges facing the UAE IT market, Mindware’s operations in countries such as Egypt and KSA continue to gain added significance.
VERDICT Boosted by investments it has made in consolidating its backoffice functions and improving its IT systems, Mindware has been able to run a strong and steady ship under the stewardship of Jacques Chammas and Mario Gay. As a company with a dual volume and value distribution model it naturally suffered some pain from the general decline in the components and hardware market last year, but it was able to offset that with the continued expansion of its storage, networking and software portfolio.
JUMBO IT DISTRIBUTION Contact: +971 4 336 7999
GENERAL MANAGER: BIKAS BISWAS
What measures have you taken to ensure your company remains competitive?
Website: www.jumbocorp.com Headcount: 65 Active Accounts: 250 Regional Offices: Kuwait, Oman, UAE
Key Brands: Acer, HP, LG Electronics
Ownership: Jumbo IT Distribution is an independent division of privately-held Jumbo Electronics Company
2009 SALES
US$269m 2008 SALES
US$324m
The first major one is credit discipline - collections and exposure. There are two parts to it: how much you have to give to the customer and how you are going to ensure the credit terms are followed. Discipline in stock and inventory management is also important and the whole organisation is very focused on ensuring bad inventory doesn’t get stuck with us. The recession has also given us some opportunity to clean up the fat internally and improve the quality of the people, which means we are a much more robust organisation than in the past.
What are your main strategic plans when it comes to developing the business in 2010? We don’t plan to do anything extraordinary because it is not a time for experimentation, I am very clear about that. But strategically we have shifted our business from the high street and the plazas to the retailing space - companies like Carrefour, Plug-Ins, Jacky’s, CompuMe, Alghanim and Eureka. Business is more sustainable there, the credit is safer and it is also more predictable. We are also aligning ourselves with the vendors so that the products we buy are more suitable for the retail segment than the SMB segment. The prinicples of distribution are efficient logistics, efficient credit management, strong alignment with vendors and being a thinking organisation, because what is good for today may not be good for tomorrow.
LOGICOM DUBAI LLC Contact: +971 4 507 8888
COMPANY FOCUS Jumbo IT Distribution is one of the few distribution houses to manage just a handful of brands, namely Acer, HP and LG. This means its business is heavily shaped by the behaviour of those vendors in the Middle East market and the sales strategies they implement. At the same time though, its decision to resist brand expansion and focus so narrowly has allowed it to concentrate on the job in hand and develop business with some of the most prominent IT and electronics retailers in the Gulf market.
VERDICT HP’s decision to appoint more PSG distributors at a time when the market was contracting was always going to impact Jumbo’s top line performance in 2009, particularly as the distributor chose not to widen its brand portfolio in response. However, a renewed focus on the power retail space, which could even see the company launch a dedicated accessories unit in the coming months, should put Jumbo back on track this year and reduce its exposure to potential bad debts in the channel dealer community.
GENERAL MANAGER: NICHOLAS ARGYRIDES What measures have you taken to ensure your company remains competitive?
Website: www.logicom.ae Headcount: 170 Active Accounts: 2,000 Regional Offices: Bahrain, Kuwait, Jordan, Lebanon, Oman, Qatar, Saudi Arabia, UAE Key Brands: APC, Cisco, HP, Intel, Kingston, Linksys, Microsoft, Symantec, Trend Micro Ownership: Logicom Dubai is the UAE-based subsidiary of the Cyprus-listed Logicom Group
2009 SALES
US$280m 2008 SALES
US$271m
In such a challenging business environment we had to revisit all our partner accounts as we were obliged to follow credit insurance decisions based on the policy of the board of directors. We focused on accounts that we felt comfortable with, both in terms of financial fairness and project-execution capability. Close links with key customers, early engagement in projects, timely response, effective stocking and taking up particular opportunities, such as our partnership with HP, all helped us remain on top of our game. There is always an opportunity behind every challenge so we made sure we tried to grab those opportunities.
COMPANY FOCUS What are your main strategic plans when it comes to developing the business in 2010? On a general level it is about prudence, focusing on key brands and cross-selling, maintaining a healthy cash flow and controlling expenditure, which we will be even stricter on this year. Improving systems, through enhanced CRM and e-commerce capabilities, is another way of reducing costs and improving the bottom line because we are not in a market where you can really increase prices. Our focus will remain on the SMB and midmarket segments - which are still going strong - so that we are not directly affected by shrinking IT budgets in the government and large enterprise sectors. Focusing on plentiful, smaller accounts reduces risk and gives us customer breadth.
(34) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
Logicom remains one of the most prominent names in Middle East distribution, with a brand portfolio balanced largely between HP, Cisco, Intel and Microsoft – a marked change from just a few years ago when the company was largely perceived as an Inteldependent outfit. With offices throughout the Gulf and Levant region, the publicly-listed outfit continues to focus its efforts on exploiting the customer breadth that it has developed in both the SME and midmarket sectors.
VERDICT Its exposure to elements of the components and corporate markets meant 2009 ranked as the toughest year yet for a distributor that now makes half of its annual group business from the Middle East. That said, the timely addition of an HP contract in several countries more than made up for any dropoff in business that it may have experienced elsewhere. Aside from that, Logicom’s conservative - but ultimately diligent - approach to credit management has kept the company on a stable footing.
BDL GULF FZCO Contact: +971 4 352 8377
CEO: TAMER ISMAIL What measures have you taken to ensure your company remains competitive?
Website: www.bdlgulf.com Headcount: 250 Active Accounts: 2,700 Regional Offices: Bahrain, Egypt, Kuwait, Saudi Arabia, UAE Key Brands: Acer, Asus, Creative, Dell, LG, MSI Ownership: BDL Gulf is a subsidiary of privately-held BDL in Saudi Arabia
We focused a lot on partners who were addressing the hypermarkets and retail superstores. In addition, our company’s balanced financial performance allowed us to benefit from extended financial facilities and helped us grow in a calculated way. Through the internal credit unit established within the company, we were able to control and monitor credit facilities and we took into consideration the recommendations of banks and insurance companies to continue our balanced growth. During those tough times we also followed the realistic expectations of the market to avoid facing excess stock or losing any sales opportunities due to unavailability of stock.
What are your main strategic plans when it comes to developing the business in 2010?
2009 SALES
US$320m 2008 SALES
US$285m
The main aims are to achieve sales of more than US$380m and, most importantly, run a profitable business. Protecting our customer base and helping them increase profitability - in addition to helping them manage their business effectively and professionally - will allow us to achieve that. We aim to increase our market share, especially in the Gulf markets, by increasing our business with current partners and looking for new opportunities that would contribute to us achieving our goals. An example of that is the recent step of adding Acer to our portfolio, which will add volume to the business.
BDL has transformed itself from a Saudi-only distributor into a pan-GCC player during the last two years, reinforcing its position as one of the most influential distributors in the MENA region. An internal restructuring midway through last year saw the longserving Tamer Ismail installed as CEO for the entire Gulf business, with Hani Abdul Moneim taking charge of the Dubai office. They aim to expand BDL’s product basket in the quest to drive sales closer to the US$400m mark.
APTEC HOLDINGS LIMITED Contact: +971 4 369 7111
VERDICT
COMPANY FOCUS
It is not surprising that BDL has managed to scale up its business during the past year given the bulk of its revenues are generated from Saudi Arabia, where it has a formidable presence in all of the main provinces. That said, markets such as Egypt are also becoming increasingly important to the LG and Microsoft distributor’s balance sheet, while the imminent launch of a sales office in Qatar will support a GCC business that already boasts local operations in Bahrain, Kuwait and the UAE.
CEO & PRESIDENT: ALI BAGHDADI
What measures have you taken to ensure your company remains competitive?
Website: www.aptecme.com Headcount: 300 Active Accounts: 3,000 Regional Offices: Egypt, Kuwait, Lebanon, Pakistan, Saudi Arabia, UAE Key Brands: 3Com, 3M, Acer, Adobe, APC, Avaya, Belkin, BenQ, BO, CA, Cisco, Dell, D-Link, Fujitsu, HP, IBM, ISS, Lexmark, McAfee, Microsoft, NetApp, Oracle, Sun, Symantec, VMware Ownership: Privately-held Aptec Holdings is majority owned by DIFC Investments
2009 SALES
US$336m 2008 SALES
US$306m
Managing the cash was absolutely essential – it is an important issue particularly if you want to grow. Secondly, when it came to expenses, fortunately we managed to retain all our staff. We didn’t make any cuts, but we did introduce a number of measures including the expansion of our outsource centre in Cairo. That has taken some of the pressure off the more expensive recruits in the GCC countries.
What are your main strategic plans when it comes to developing the business in 2010? Our key objective this year is to focus on the countries that have shown us growth in 2009 and that tends to be the GCC plus Egypt and Levant. We are watching the Turkish market closely to see how we can take advantage of that when it turns around and starts to pick up, not forgetting some of the new countries that we have entered like Pakistan, where the growth is potentially very high. We are very fortunate to be in the middle of probably one of the highest growth regions in the world today, so in addition to that you’ll just see more efficiency and more automation from our side, as well as more investments in value added services. Some people regard the Middle East as high risk - we don’t. You just need to understand it. You can’t sit in Jebel Ali and think that you are doing the Middle East. You have got to go where the business is and be there through a physical presence.
COMPANY FOCUS Aptec is one of the longest-serving distributors on the circuit and will celebrate its 30th anniversary this year. Reaching such a milestone is proof of the company’s ability to adapt to a rapidly-changing distribution market and reinforces its philosophy that you must be able to offer local sales and support to prevail in the Middle East. Aptec also owns Track Distribution, a supplier of Cisco and other enterprise kit, borne out of the acquisition of Tech Data Middle East three years ago.
VERDICT It wasn’t long ago that Aptec was regarded as a broadline player but radical changes to its vendor portfolio and services infrastructure have seen it become firmly ensconced in the value space with brands such as Cisco, Oracle and APC. Expect its ongoing geographic expansion to be supported by moves to extend its infrastructure services for data centres this year. The company is also in talks with Microsoft to see how it can support the software vendor’s regional plans from a services perspective.
(37) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
FDC INTERNATIONAL FZE Contact: +971 4 397 8035 Website: www.fdcinternational.com Headcount: 200 Active Accounts: 600 Regional Offices: Algeria, CIS, Egypt, Jordan, Kuwait, Lebanon, Saudi Arabia, UAE Key Brands: Acer, Apacer, ASRock, Asus, EliteGroup, Intel, Kingston, Lenovo, Lite-On, Seagate, Sony, WD, XFX Ownership: FDC International is privately owned by a small group of independent investors
2009 SALES
US$344m 2008 SALES
US$282m (Distribution revenues only. Figures do not include PC assembly sales)
COO & VICE-PRESIDENT: MARISSA SAFE
What measures have you taken to ensure your company remains competitive? We have made a lot of investment from an in-country perspective, which has ensured that we have been able to control the market better. If you sell everything from Dubai you cannot do that – you have to ship inside the countries, collect in local currencies and provide local RMA. We opened a service centre in Iraq, for example, while in markets such as Saudi Arabia and Egypt we focused on warehousing and developing more in-country infrastructure. We also did more channel education, such as roadshows, to help partners sell the technology, particularly the high-end products so that business is more profitable for them, for us and for the manufacturers.
What are your main strategic plans when it comes to developing the business in 2010? We have made a strategic decision to focus on Saudi business expansion and increase the brand portfolio. Currently we are selling hard drives there and that is the biggest share of the products, but now we would also like to focus on Lenovo for Saudi and Asus for Saudi, as well as more of the components brands. So we want to do more with our existing businesses and add more vendors to the portfolio. We will also focus on developing a stronger infrastructure internally. We have a 10,000 square metre building in Jebel Ali to manage parts of the group like logistics and that will help us to control the efficiency of the company.
FDC is a well-known face on the distribution scene with a track record of penetrating some of the region’s toughest markets. It also continues to operate a desktop PC manufacturing arm that accounts for 10% of its annual sales. Add that to its distribution business and you have a company with revenues of US$382m last year – enough to move it up three places in the rankings and make it the third largest Dubai-based IT distribution group behind Redington and Metra Computer.
ALMASA IT DISTRIBUTION FZCO Contact: +971 4 306 3100
VERDICT
COMPANY FOCUS
Presiding over one of the largest components portfolios in the market might have hurt FDC last year had it not been for the fact that the company has been aggressively ramping up its finished goods business and building a retail division that now boasts 40 promoters and accounts for a significant chunk of its turnover. An increasing emphasis on in-country sales, coupled with its re-export capabilities, also contributed to FDC growing at the impressive rate it claims to have done last year.
CHAIRMAN & CEO: MEHDI AMJAD
What measures have you taken to ensure your company remains competitive?
Website: www.almasa.com Headcount: 200 Active Accounts: 1,200 Regional Offices: Kuwait, Oman, Qatar, Saudi Arabia, UAE Key Brands: Acer, Asus, Avaya, Belkin, Blue Coat, Extreme Networks, Hitachi, HP ProCurve, Imation, Microsoft, Seagate Ownership: Almasa IT Distribution belongs to the privately-held Almasa-Omniyat group of companies
2009 SALES
US$355m 2008 SALES
US$440m
Cost control has been a major focus for us and will continue to be this year. I think distributors have to keep looking at how they can deliver the same quality with less cost and more efficient processes. Every aspect from your inventory days and receivables to the way you manage your location points has a direct impact on your bottom line. The other thing is credit management and being closer to customers so you can provide competitive propositions to them while managing your credit risk. We were much tougher in terms of our credit policy and credit-giving in the market place and I think that was a good decision.
COMPANY FOCUS What are your main strategic plans when it comes to developing the business in 2010? 2010 will be very much about focusing on the retail and value side of the business. We’ll become closer with HP ProCurve, Avaya, Extreme and Blue Coat and we’ll even try to look at new vendors within the value side of the business. On the volume side we’ll get more into finished goods than we used to. Two months ago we started the monitor business with Acer across the region and that is going very well. Potentially we may add more vendors in the display and LCD area, as well as on the notebook side. With our big warehouse in Jebel Ali now open we are also revisiting our warehousing strategy; trying to centralise more and having logistics solutions to reach customers faster.
(38) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
Almasa’s business stands on three core pillars - retail, networking and channel - and recent vendor partnerships reflect this focus. WatchGuard and Ericom have both been signed this year, signalling Almasa’s desire to capture brands that can enhance the profile of its value division. Having gained a solid retail-focused venture in the form of Delta Business Products, Almasa is also emerging as a serious contender in the retail space where it now distributes many influential consumer brands.
VERDICT Almasa still retains a strong market position following a year that saw it both lose and gain major vendor franchises, as well as complete the acquisition of Delta Business Products. The reduction in its sales is largely due to the termination of its relationship with HP, which had previously accounted for a whopping 45% of its business — some US$200m a year. Take that out of the equation and Almasa clearly managed to grow many of its other vendor lines, while also reducing its cost base.
EMITAC DISTRIBUTION LLC Contact: +971 4 605 8200
CEO: AMER KHREINO
What measures have you taken to ensure your company remains competitive?
Website: www.emitac.ae Headcount: 200 Active Accounts: 1,300 Regional Offices: Jordan, Kuwait, Lebanon (strategic alliance) Qatar, UAE Key Brands: 3M, Acer, Eaton MGE, HP, Logitech, Microsoft Ownership: Emitac Distribution is one of several business units owned by the Bukhatir Group
2009 SALES
US$358m 2008 SALES
US$383m
We looked at our business with certain key objectives as the main drivers, the most important of which was liquidity. With the pressure of placing higher orders, investing in new products and facilitating new customers you could have landed yourself in real trouble given the market dynamics, so we focused very strongly on liquidity. Retention of valuable talent was also key, and we continued to look at sizing our working capital to prevent unnecessary exposure, which resulted in us seeing almost the same efficiencies as we did in 2008.
What are your main strategic plans when it comes to developing the business in 2010? We definitely want to develop more added value services in terms of pre-sales and specific go-tomarket areas. We also have to consider the recovery of profitability to pre-crisis levels - it will be very difficult to continue driving loss-generators because they won’t take you anywhere and you will not be able to scale your capabilities and resources to cope with the new initiatives. You expand and invest when there is a good return to the shareholders and in the absence of very solid returns the management’s responsibility is to find new areas of excellence. We have already demonstrated that in areas of support services, logistics services and added value distribution, especially at an enterprise level.
After inking a strategic alliance in Lebanon last year and recently opening a new office in Kuwait, Emitac should profit from its extended geographic coverage as the market begins to blossom again. Its strong HP heritage leaves it heavily pegged to the PC vendor’s strategy, although the other brands in its portfolio have a growing part to play in its future endeavours. Acer, for instance, has just awarded Emitac a consumer contract to go with the commercial rights it already held.
METRA COMPUTER GROUP FZCO Contact: +971 4 317 0800
VERDICT
COMPANY FOCUS
In 2009, Emitac succeeded in doing 90% of the revenues it managed the year before – a remarkable achievement when you consider that its brand basket remained unchanged and its largest partner, HP, appointed two new volume distributors even though the market was slowing. With conditions in the hardware market showing signs of improvement, a concerted focus on both top and bottom line growth should ensure 2010 proves to be a year that Emitac will look back on fondly.
MANAGING DIRECTOR: NY PRASAD
What measures have you taken to ensure your company remains competitive?
Website: www.metracomputer.com
Headcount: 900 Active Accounts: 3,000 Regional Offices: Bahrain, Egypt, Iraq, Jordan, Kuwait, Qatar, Saudi Arabia, UAE Key Brands: Acer, Cisco, Dell, D-Link, HP, Intel, Microsoft, Samsung, Western Digital Ownership: Metra Computer Group is a privately-owned company founded in Egypt
We have looked at increasing speed to market and operational efficiencies - taking as much cost out of the system as possible in terms of the supply chain. We have been as lean as possible in terms of our inventory management and tried to have a little more control over our receivables in the market. While we have tried to increase our leverage in terms of the revenue, we have also tried to take some cost out of the system when it comes to OPEX as a percentage of revenue. The fundamentals of distribution are largely about scale of operation, efficiency and how to control working capital and cash. I think operational efficiency is the key to riding out this slowdown period in the Middle East before things come back.
What are your main strategic plans when it comes to developing the business in 2010? 2009 SALES
US$530m 2008 SALES
US$471m (Distribution revenues only. Figures do not include PC assembly sales)
Consolidate on what we started last year. 2010 will be the first full year of having the complete portfolio of products that we brought on board in 2009, so that’s a key initiative for us. Another key objective for us is to maintain profitable growth and we are definitely looking at opportunities in and outside of the UAE to maintain our momentum. One of the strategic things we are working on is the value business. Right now we only have a value branded portfolio in Egypt, but we are going to look at taking that into select markets and expanding the value portfolio across the region.
COMPANY FOCUS The experienced NY Prasad has been overseeing Metra’s Gulf business for more than a year now and his tenure has coincided with the company reinforcing its position as a true one-stop-shop for the retail and reseller channels. The dominance that Metra enjoys in its native Egypt, where it is a partner of brands such as HP and Cisco, coupled with the strength of its in-country operations in the GCC, has ensured the company has been able to post top line growth in a largely depressed market.
VERDICT Metra is among the fastest growing distributors in this year’s Power List and when you look back at the raft of agreements it has either signed or extended in the past year it is not difficult to understand why. The addition of regional contracts with HP IPG and Acer, plus Samsung monitors and HP PSG in selected countries, has given further weight to an already impressive A-brand portfolio. The big question is whether the broadliner can maintain the sort of lofty growth rates it has now become used to.
(39) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
Tel: 971 4 31 70800, Fax: 971 4 39 61987
REDINGTON GULF FZE
CEO: RAJ SHANKAR What measures have you taken to ensure your company remains competitive?
Contact: +971 4 359 0555 Website: www.redingtongulf.com Headcount: 400 Active Accounts: 3,520 Regional Offices: Egypt, Kenya, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, Tanzania, UAE, Uganda Key Brands: Acer, Cisco, Dell, HP, Samsung
Ownership: Redington Gulf is a subsidiary of Bombay-listed Redington (India) Limited
When the economic challenges came to the fore we said we would take care of five things and we called it the ‘CC’ approach - cut costs, control credit, customer care, cautious capital and collect cash. In terms of ‘cautious capital’, the single most important performance parameter in our business is return on working capital and we continuously raised that capital wherever possible with enough funding, bank lines and facilities with different institutions. You may be surprised to know that we probably used no more than 60% of our total bank lines at any point in time because you never know which bank could just collapse or suddenly stop giving credit.
What are your main strategic plans when it comes to developing the business in 2010? We will continue to add brands to our portfolio and, more importantly, grow the value added distribution business. That did reasonably well for us last year in spite of the challenges during 2009 and the fact that the corporate sector was the most impacted in my opinion. We’ll also make our automated distribution centre operational this year and that will be a clear differentiator. Considering we have about 29 brands and several thousand SKUs across so many locations it is important to have an efficient logistics centre. Finally, we will continue to expand into more markets in Africa, which for us is the next growth engine.
2009 SALES
US$1.19bn 2008 SALES
US$1.13bn THE 2010 POWER LIST
VERDICT
COMPANY FOCUS Its top line growth might have slowed last year but Redington is still the only distributor in the Middle East and Affrica region to cross the US$1bn revenue mark due to its extensive geographic presence and relationships with all of the largest international IT hardware providers. Its African business also continues to come on in leaps and bounds – last year it contributed around US$250m to its MEA revenues and we wouldn’t bet against that figure increasing even further in the future.
It is not surprising that BDL has Some might have expected managed totoscale upthe its business Redington bow to pressures during the pastmarket, year given of a dwindling but the several bulk of ensured its revenues are generated factors it maintained its from Saudi it has scale. The fiArabia, rst was where the addition a formidable presence all of of new brands, notably in Dell, to its the main provinces. That portfolio, which helped it said, offset the markets such as Egypt are also extra competition it gained in the becoming important to HP space. increasingly Redington also expanded LG and Microsoft distributor’s the work it did in key geographies balance sheet,and while the imminent such as Egypt picked up the launch a sales officeespecially in Qatar pace in of Saudi Arabia, willthe support a GCC that in printing and business supplies arena alreadyASPs boasts local operations where generally saw morein Bahrain,than Kuwait the UAE. stability theand PC market.
Audited
Stated
2009
2008
2008
Auditor
Staff
Active Accounts
Product Focus
Redington Gulf
$1.19bn
$1.13bn
$1bn
Deloitte Haskins & Sells
400
3,520
PC Hardware, Networking, Storage
Metra Computer Group
$530m
$471m
$465m
Ernst & Young
900
3,000
PC Hardware, Networking, Storage
Emitac Distribution
$358m
$383m
$401m
KPMG
200
1,300
PC Hardware
Almasa IT Distribution
$355m
$440m
$433m
Deloitte
200
1,200
Retail, Networking, Security
FDC International
$344m
$282m
-
Puthran Chartered Acc.
200
600
PC Hardware & Components
Aptec Holdings
$336m
$306m
-
Ernst & Young
300
3,000
Networking, Storage, Software
BDL Gulf
$320m
$285m
$285m
Usamah Ali Tabbarah & Co
250
2,700
PC Hardware & Retail
Logicom Dubai
$280m
$271m
$250m
KPMG
170
2,000
Networking, Software, Components
Jumbo IT Distribution
$269m
$324m
$324m
Grant Thornton
65
250
PC Hardware & Retail
Mindware
$189m
$210m
$210m
Deloitte & Touche
135
1,000
Networking, Software, Components
Asbis Middle East
$183m
$169m
$169m
Deloitte Limited
90
900
PC Hardware & Components
Despec MERA
$155m
$144m
$145m
KPMG
70
700
Supplies & Consumables
Empa Middle East
$131m
$123m
$123m
BDO Patel & Al Saleh
85
740
Components & Retail
Trigon
$128m
$115m
$118m
El Syed El Ayouty & Co.
95
325
PC Peripherals & Retail
Golden Systems Middle East
$109m
$95m
$95m
Salim Rajkotwala
100
500
Components & PC Peripherals
Distributor
EDITOR’S NOTE: It is probable that Al Yousuf Digital would merit a place on this year’s list. In 2008, the Epson and ViewSonic distributor claimed it made sales of US$160m. We would expect the 2009 figure to be between US$140m
and US$170m based on the performance of distributors with similar portfolios. However, Al Yousuf Digital recently underwent a change of management and unfortunately had not got back to us ahead of publication. We should also point out that Westcon Middle East Group, which was part of the 2009
Power List, only just missed out on making it into this year’s edition due to the addition of volume distributors that were not included last year. Westcon’s sales rose from US$94m to US$107m last year, leaving it fractionally behind Golden Systems Middle East, which occupied the final place on this year’s list.
(41) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
Presented by
Future ICT 22â&#x20AC;&#x201C;24 March 2010
ha
In association with
Join them and take your place at the regionâ&#x20AC;&#x2122;s largest exchange of knowledge on future ICT solutions Susanne Dirks
Dr. Soumitra Dutta
Leader, Global Centre for Economic Development, IBM Institute for Business Value, Ireland
Roland Berger Professor of Business and Technology and Academic Director of eLab, INSEAD, France
Prof. Howard Schmidt
Malek Sultan Al Malek Executive Director, Dubai Internet City
e-Government
Gold sponsor
Policy & Strategy
Strategic partner
Content Management
Official broadcaster
Green IT
Official publisher
Dr. Najat Rochdi Director Policy, UNDP, Geneva
Resource Planning
Advisor, Information Systems, Ministry of Foreign Affairs, UAE
Networks & Integration
Telecoms
Virtualisation & Cloud Computing
Founding partners
e-Security
Datacentres & Storage
Creative partner ts Po
Co
dam eGovern
Smart Cities
Organised by
m t en
Th e
Platinum sponsor
ICT Literacy
CISSP, CISM (Hon), President and Chief Executive Officer Information Security Forum and Former White House Cyber Security Advisor
Dr. Saeed K. Al Dhaheri
HARRINGTON MCDERMOTT www.hm-marketing.com
mp
etence Cen
te
r
Entry into the exhibition is free and conference passes can be purchased from US$495 Register at www.FutureICTSummit.com
YEAR OF THE VAD Emerging E Em me errg rgi ging technologies tec echn chn hno ollog ogie ies distributor diissttri d ribu buto buto torr FVC FVC iss celebrating FV cel ele ebrra eb atiting ati ting its its s tenth te en nth h anniversary an ann nn niive vers rsa arry this tth his is year. year. earr.. Ch ea Channel C an a nn ne el Middle Mid Mi Midd dd dle East Eas astt ssat at d at down own with own ow witth wi h managing ma m an na aging in ng g director, dir irec ecto or, r, KS KS Parag, Pa P ara rag, g, to to discuss disccusss the di t e future th ffu uttu ure re of of the tth he value va alu ue added ad dde ded distribution dist di strriib bu uttiion on model mod odel del el and an nd d hear hear ea why ea wh hy the th he company co comp omp pan any iss listening lis iste t ni n ng ng carefully to what resellers have to say.
How many vendors are you working with in total today and is there scope to bring more brands on board or are you satisfied with your coverage? KS PARAG: We have about 23 vendor partnerships, but I would say the focus has been more around 10. I believe the portfolio does give us the coverage we want but we do have some areas we would like to expand into, especially on the security side and authentication to ensure that we could give the complete security offering, including a
unified threat management. There are areas where we are looking at new vendor partnerships, especially in the identity management space, and we are going to be tying up with a new company in that area. What is your take on the value added distribution landscape in the Middle East at the moment? Has it evolved in the way you expected? KS PARAG: I believe there has been a strong requirement for companies like FVC
(44) // CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
to show their value, both to end-users and partners, in bringing greenfield technologies to the market and ensuring they evolve and are successful in their respective regions. I think we have seen this happen, not only with us but also with others who have done it in the same landscape. Distribution is definitely evolving, but it changes every day because acquisitions narrow down the market in terms of the new technologies. We are seeing more and more new companies acquiring and getting acquired â&#x20AC;&#x201D; like TippingPoint (3Com), which is now part of HP.
The vendors you deal with generally provide specialised technology g in niche areas, which tends to make them attractive acquisition targets. Do t you make provisions for companies y changing ownership when you partner with them? Or do you just accept that it w is something that might happen? KS PARAG: Earlier we actually accepted it, but as we speak the strategy for 2010 is to b look more closely at the business in terms of how resilient it is to takeovers and partnerships. We’ve been able to offer more services so that we are more resilient to it. Is it part of your strategy to work with vendors on an exclusive basis? KS PARAG: We have typically always tried to work on a sole distribution strategy. The value add generally comes both for the vendor and the VAR when they synchronise fully within themselves. I don’t believe it is a question of exclusivity, but a question of how much trust and faith both of the organisations have in each other’s ability. As long as those abilities are matched — whether it is done by one partner or more — can only be determined by the market, but as long as one distributor can cover it I strongly believe it is fruitful for the vendor and the VAD. The volume of business is not as quantified as the PC or components business, where the volume justifies the margin. Here the volume is not as high so the margins have to justify the business. Is there any possibility that you would attempt to work with some of the more mainstream networking and security vendors in the future, rather than the emerging technology vendors you’re typically associated with? KS PARAG: The strategy is still focused on the cutting-edge technology vendors; I don’t see us doing mainstream, but you’ll definitely see us evolving more into services. We will be more involved in things like professional services and consultancy in terms of postsales. I could see us offering more in the way of product scope and services so that we are not only offering a higher level of service to our customers, but also to our partners.
Distribution is definitely evolving, but it changes every day because acquisitions narrow down the market in terms of the new technologies So these would be ser vices that resellers sub-contract from you? KS PARAG: Yes, or we would basically be the level two or level three escalation for the vendors in the region. We are looking at being the level two, minimum, for escalation of everything. We are working towards ensuring that we even have a hotline in most of the regions and we should be kick-starting something like that in the UAE. What else is on the agenda for FVC in 2010? KS PARAG: We are optimistic in terms of market growth. I think for most of us 2009
saw flat growth, if not marginal growth, so most companies, including vendors, will be looking for a solid performance this year. What we would like to do is look at being a more solid and unified team to ensure that we take a bigger chunk of the leading-edge technologies business in the region. We will be focusing on ensuring we can offer a complete portfolio of security services and solutions and also explore potential partnerships in areas such as virtualisation. How do you view the competitive landscape these days? KS PARAG: The market has been competitive, but I think our unique value proposition to any vendor or partner has been our ability to be present across the Gulf at a local level. There is practically nobody who can say that they are in the same number of locations that FVC is present. We believe we have to act locally, work locally and think globally. It is very important that we work at a local level to drive the different technologies
PLAYING THE CONSULTANT
FVC has created a new unit dedicated to channel development activities and strategic alliances, which is being led by Guru Prasad, the former head of its networking business. FVC boss, KS Parag, says the move reflects the increasingly important role of channel development and empowerment in the value added distribution business today. “This unit is the key driver to make sure that we develop a high-powered partner network, which is certified, trained and qualified — not only to sell the different technologies but to actually take care of the first-line support and provide the consultative
role that is required,” he explained. “Whenever you promote a leading-edge technology you need this consultative approach of actually positioning a product. We are very keen in terms of channel development and see it as one of the main areas we would like to improve upon in 2010,” revealed Parag. Although FVC has been providing channel development services up to now, the establishment of a dedicated division is designed to make the function more formal. The unit will address both vendor and reseller relationships, said Parag. “It will map the vendor’s channel strategy and make sure that is executed through FVC. Given the requirement to grow it is very important that we have the right partnerships at a channel level to drive it,” he added. The channel development team will initially contain three members. Meanwhile, the networking unit that Prasad (pictured) was previously in charge of has been combined with FVC’s UC business under the management of Prakash Krishnamurthy.
(45) BY ANDREW SEYMOUR
// CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
in their respective areas. Having 10 office locations is something that any vendor partnering with FVC has been happy about. That must be an expensive business model to run… KS PARAG: It is a very expensive business model — very expensive! Some IT companies, especially in distribution, have closed offices in the past year to cut costs amid the downturn. Do you find yourselves under similar pressure? KS PARAG: We are always being challenged, but as a company we have always looked at a long-term strategy rather than a short-term strategy. We have actually got a business plan for the next three years, so if today a region has not been performing or not been scaling up to the same level as the overall company’s performance then obviously we do our best in terms of taking the required measures to ensure we improve it and enhance it. But I believe closing operations is not currently in the best of our interests. Are VARs’ expectations of you as a VAD changing? KS PARAG: Their needs are definitely changing. For instance, earlier we would do training for most of our vendors centrally in Dubai, but more partners are requesting training locally, whether it is in Saudi
Arabia, Egypt or Lebanon. The second thing is the demand for ensuring that we have more logistics on the ground, including support and spares. We have done that as much as possible and we are actually working towards making sure our support spares are available in most of the other locations, not just centrally in Dubai. Thirdly, we see that partners want to do more marketing events together locally. From 2008 to 2009, I believe the number of marketing exercises almost doubled. And last but not the least, there is a demand for having more core expertise in the required domain locally present.
(46) // CHANNEL MIDDLE EAST_SEPTEMBER 2009 _www.itp.net_
// CHANNEL MIDDLE EAST_MARCH 2010 _www.itp.net_
You count on Sony’s LTO
Others count on you
Sony’s Storage Tape Media offers a complete range of Enterprise storage solutions. The latest LTO Ultrium series offers storage capacities from 100GB to 800GB (Native) and up to 1.6TB (Compressed) at a maximum data transfer rate of up to 240MB per second. Whichever you choose, each offers excellent reliability and performance. So don’t compromise, choose Sony’s Storage Media.
P.O. Box: 32610, Dubai, UAE. Tel: +971-4-3936247, Fax: +971-4-3936251, E-mail: info@trigon-gulf.ae www.trigononline.com
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
FACT FILE (49) // THE MARKET BY NUMBERS
MAGIC MOBILES Record shipments of converged devices
.... .. ...
The global smartphone market emerged from the fourth quarter in better shape than ever, registering an impressive 39% spike in units compared with the previous year to defy fears that the economic downturn could stifle volumes. Vendors shipped 54.5 million converged mobile devices during Q4 — around 31% of the overall total for the year and the record for a single quarter. The surge in sales ensured shipments for the entire year grew 15%, according to data from IDC. Ramon Llamas, senior research analyst for IDC’s mobile devices technology team, says four of the top five vendors established new shipment records for a single quarter, indicating strong demand in the market. “Increasingly, mobile phone users are seeking greater utility from their devices beyond telephony and messaging, and converged mobile devices fulfill that need,” he said. “To help address demand, carriers took advantage of lower prices on many older devices, ordering additional units and, in turn, offering reduced prices to end-users. It was the perfect set of conditions to push shipments to a record level.” Market champion Nokia retained its lead at the top — an endorsement of its strategy to expand its range of touchscreen-enabled smartphones. Its nearest competitor RIM also had plenty to cheer about after exceeding the 10 million unit mark for the first time in its history. New device launches deepened the company’s product portfolio, while lower prices on its Curve and Pearl models propelled shipments further. Apple was the big winner though as iPhone shipments doubled to give the vendor 16% of the market during Q4 and help it close the gap on RIM to less than four percentage points. Elsewhere, Motorola jumped ahead of HTC into fourth place. IDC believes that the worldwide converged mobile device market will see even stronger sales in 2010, particularly as Google’s Android operating system and Palm’s webOS have revealed new ways to surround users with increased functionality. Kevin Restivo, senior research analyst at IDC, suggests more advances are in store given Symbian and Windows are expected to unveil new versions of their respective operating systems. “These and other operating systems will compete with attention-grabbing intuitiveness and seamlessness, a thriving mobile application library and a compelling user experience that tightly holds onto the user,” he predicted.
NOKIA STRATEGY PAYS DIVIDENDS Expansion of touchscreen range bolsters vendor’s sales
_WORLDWIDE CONVERGED MOBILE DEVICE SHIPMENTS BY VENDOR DURING Q4 2009 Nokia 38% RIM 20% Apple 16%
Motorola 5% HTC 4% Others 17%
SOURCE: IDC
APPLE MAKES STATEMENT OF INTENT Global iPhone shipments double during buoyant fourth quarter
_WORLDWIDE CONVERGED MOBILE DEVICE SHIPMENT GROWTH BY VENDOR DURING Q4 2009
Apple 98% RIM 41% Nokia 38% Motorola 56% Others 13% HTC 9%
SOURCE: IDC
>>
.... .. ...
>]
=
{"|"}
*/
[]
[o]
\ -->
oo
{}
www.bdlgroup.com
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
CONSUMER ELECTRONICS (51) // RETAIL CHANNEL NEWS
SONY MAKES ITS CASE FOR REIGNING SUPREME IN 3D Consumer electronics manufacturer claims it has the edge over its rivals as it is “uniquely positioned” to sell both hardware and content
C
onsumer electronics heavyweight Sony has declared its intent to dive headfirst in the 3D entertainment battle by announcing plans to “accelerate initiatives” around the technology. The company insists it is aiming to deliver an array of 3D entertainment to the home in 2010 in a bid to create a 3D world encompassing electronics, games and movie content. Last month in Dubai, Sony showcased its first line-up of 3D entertainment products for the home, with Hiroyasu Sugiyama, boss of Sony’s 3D strategy office, outlining why the vendor believes its overall offering will be among the most compelling in the market.
“For Sony, 3D is strategically very important, and we are committed to lead the 3D industry,” he explained. “In the 3D space, Sony is very uniquely positioned compared to other consumer electronics makers because we are not only going to sell 3D-compatible consumer hardware but also ensure there is affluent variety of 3D content that consumers can enjoy,” said Sugiyama. Over the course of the next 12 months, Sony plans to introduce a series of 3D-compatible consumer electronics products, including Bravia LCD TVs, Blu-ray Disc players, home theatre systems, VAIO PCs and digital still cameras. It will also
provide firmware updates to make PlayStation3 units compatible with 3D stereoscopic games. Sony claims there is an installed base of more than 500,000 units for PlayStation 3 in the Middle East and Africa alone. Sony Gulf’s managing director, Osamu Miura, insists 3D technology has already captured the imagination of content creators and broadcasters, adding that Sony is wellpositioned to introduce such technical innovations through the retail channel. “Today, 3D is the next generation of home entertainment and, with our technological leadership, we stand at the forefront of 3D technology,” he commented.
The race to win over consumers in the 3D TV space has intensified since many of the top electronics companies showcased their wares at the recent CES exhibition in the US. The likes of Samsung, Pansonic, Philips and LG have all announced plans to roll out new 3D TV models over the coming months. Some analysts believe market adoption could be so strong that half of all households will own a 3D TV in the next five years.
Osamu Miura believes Sony stands “at the forefront” of 3D technology
distribution partner for all its consumer electronics products.
LG CONFIRMS NEW DISTIE IN LEBANON
Shaker Electronics & Appliances — better known as SEALCO
SEALCO to manage CE business
I
ndustry giant LG Electronics has revamped its channel structure in the Lebanese market by appointing a new
— will now serve as LG’s official distributor in the country with a brief to drive the company’s business forward. News of the tie-up was announced by LG’s Middle East boss, Kiwan Kim, at a special launch ceremony in Beirut. SEALCO chairman, Hassan Shaker, says he is confident that the distributor will be able to capitalise on the strong demand that already exists for LG products in the Lebanese market. “Our efforts together will strengthen our operations in the country and will promote LG’s brand to better face the competition in order to take its fair share of the market.”
>>
.... .. ...
>]
=
{"|"}
*/
[]
[o]
\ -->
oo
{}
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
BUSINESS INSIGHT (53) // INDUSTRY-WIDE NEWS
::
CISCO SHUTS THE DOOR ON HP TO PREVENT IT GAINING INFO ON COMPETING PRODUCTS Vendor confirms it will not renew HP’s reseller accreditation when it expires in April as increased competition between the pair in the data centre space has created conflict isco has announced that it will part ways with long-term partner HP. In a statement, Cisco said that it will not renew HP’s reseller contract when it ends in April, citing increased competition between the two in the data centre sector. HP had been a strong partner for Cisco, but with the announcement of Cisco’s Unified Computing System (UCS) data centre offerings in November, and HP’s purchase of 3Com, Cisco has decided to terminate the relationship. Keith Goodwin, senior VP of Cisco’s worldwide partner organisation, said: “Being a Cisco Certified Channel Partner has numerous benefits including access to proprietary information (such as product roadmaps) and partner profitability
C
initiatives. Given the evolution of our relationship it simply no longer makes sense to provide these benefits to HP.” The two companies have said they will continue to support existing customers. Ovum analyst Adam Jura said that the major winners will be Cisco’s other major partners. “In the cold light of day, it appears that HP needs Cisco more than Cisco needs HP, with the 3Com acquisition expected to still take some time to be completely integrated. In addition, the QLogic partnership expansion (which will see HP sell its switches) will also demand substantial time and effort to fully cascade through and convert into real business opportunity,” he said. News of the pair’s split came just days after HP
polled by software vendor
recession is over and are preparing themselves for an upturn in fortunes during 2010. The software company’s annual channel index paints an improving picture of the EMEA landscape, with CA resellers generally feeling more buoyant raised hopes that the IT industry is returning to a more solid financial footing by posting sales and revenue growth for its November-January quarter. Fiscal Q1 net revenue picked up 8% year-onyear to $31 billion as both consumers and commercial customers began to buy new hardware again. However, it still appears that HP has work to do in EMEA, where the business grew rose just 1% compared with the year before.
Security vendor puts emphasis on new partner programme to drive greater percentage of its business through the channel etwork security products firm Sourcefire has whipped the covers off a new multi-tiered marketing and training programme for resellers and distributors. The Global Security Alliance Channel Programme is designed to strengthen Sourcefire’s relationship with partners and create higher margin sales training and marketing activities so that a greater percentage of business is transacted through the channel.
T
wo thirds of EMEA resellers
CA believe the worst of the
SOURCEFIRE EYES CHANNEL N
CA VARS HOPING TO BOUNCE BACK
NASDAQ-listed Sourcefire, which made a net profit of US$2.7m on sales of US$27m during the last full quarter for which it published financial results, claims the scheme is being supported by a closer alignment of its field sales team and marketing programmes. “Over the past six months, we have collaborated with resellers and distributors around the globe to build this programme, designed
Keith Goodwin says it no longer makes sense for Cisco to work with HP on a reseller basis
>]
According to CA, 66% of respondents predict that the economic situation will get better this year, while 43% anticipate a “surge” in IT budgets. The vendor insists its index tells a more positive story than in 2009, when it claims 64% of budgets were lower than the year before. “2009 was a tough period for our partners. This year there is a marked difference — with the index showing that our partners across EMEA are positive about the outlook for the upcoming
for our partners, by our partners,” stated Chris Peterson, VP of worldwide channels at Sourcefire. “As a result, the Global Security Alliance Channel Programme aligns with their goals.” Benefits of the initiative include a deal protection scheme and rewards programmes that will offer sales reps additional incentives as they grow their pipelines. The vendor, which has a Middle East office in Dubai and works with UAE distributor Secureway, is also promising to provide partners with various training options, including two new professional services certifications.
.. >> .... ...
about their prospects this year.
=
{"|"}
year,” said Jose Carvalho, VP for EMEA channel sales at CA. Asked about the topic areas that they expect to drive the market this year, 74% of CA partners said virtualisation would provide the largest opportunity, followed by cloud computing.
*/
[]
[o]
\ -->
oo
{}
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
PEOPLE (54) // APPOINTMENTS AND AWARDS
APC BRIEFS KEY DISTRIBUTORS ON MIDDLE EAST CHANNEL STRATEGY Critical power and cooling services vendor flies leading wholesalers to South Africa to participate in product workshops and discuss regional business development plans
N
ot content with bringing all its distributors together for a one-off UAE cricket tournament last quarter, power supply devices vendor APC recently whisked its top partners off to South Africa for its annual distributors’ conference. Around 30 of the vendor’s key distributors from the Middle East and Africa took part in the fourday event, which ran under the umbrella of ‘Back to Growth’ — APC’s corporate motto for 2010. APC works with a number of major distributors in the Middle East including Aptec, Logicom, Redington Gulf and Westcon. Thierry Chamayou, business development manager for the Middle East and Turkey at APC, says the event gave the vendor
an opportunity to get in front of its partners and communicate its strategy for the year ahead. “‘Back to Growth’ is what we all want to achieve in this coming year and we encouraged dialogue with our partners to understand how we can accomplish this in the different markets in 2010,” he explained. “This event allowed us to empower our partners and to give them the tools they need to offer comprehensive solutions to their markets. We introduced new team members, deployed product info and aids to reinforce our strategy, our leadership and the direction to drive long-term sustainable business development in the region,” said Chamayou. As well as outlining the company’s channel and business development
::::
MCAFEE MAKES ITS SELECTION
T
he former global channel chief for Autodesk has
swapped the CAD sector for the security sector by taking up a post heading McAfee’s channel in the EMEA region. Georges Millet, who also served as EMEA channel and licence compliance director at McAfee, has worked in the IT industry for more than 25 years. strategies, distributors participated in training sessions and workshops. However, it wasn’t all work and no play. According to regional marketing manager, Tushar Choudhury, distributors also got the chance to “let off some steam” during their time in South Africa. The trip comes two months after APC organised a cricket tournament for all its UAE distributors, with the Track Distribution team triumphing over parent group Aptec in the final.
Thierry Chamayou says APC is working with distributors to find new opportunities in the market
In his new role, he will be responsible for overseeing McAfee’s EMEA channel strategy and operations. His duties will also involve aligning McAfee’s EMEA channel business with its global strategy and driving channel enablement. “McAfee’s singular focus on security and its strong product portfolio creates a proven and unique opportunity for our partners,” stated Millet (below). Meanwhile, mobile phone manufacturer HTC has hired Vladimir Malugin as its new EMEA marketing director.
PROGRESS FOR PALO ALTO Firewall appliances vendor names Paramount ‘Reseller of the Year’ following fruitful partnership launched in 2009
S
ecurity services integrator Paramount Computer Systems has picked up the ‘Reseller of the Year’ award for the Middle East and Africa from firewall appliances specialist Palo Alto Networks. Karl Driesen, VP sales EMEA at Palo Alto, insists the Middle East is a “vitally important” market for the company, adding that it aims to work with partners such as Paramount to address the complex
>>
.... .. ...
>]
=
network security requirements of customers in the region. “Although we have been working together for less than a year, Paramount has quickly demonstrated unmatched expertise and commitment, resulting in excellent success thus far,” commented Driesen. Palo Alto claims that its nextgeneration firewalls are the industry’s most powerful firewall products, enabling enterprises to
{"|"}
*/
[]
[o]
\ -->
Malugin, who was previously see and control applications, users and content, rather than just ports, IP addresses and packets. Paramount COO, Ramaswamy G, says the reseller has profited from its partnership with the vendor due to customer demand for new security infrastructure. “A combination of improved security, better visibility and control and cost reduction is a common need that we see and Palo Alto’s proven technology addresses all these parameters very well, resulting in a very strong uptake by our customers,” he said.
oo
{}
head of products and marketing at Polaroid Consumer Electronics, will be responsible for HTC’s overall brand, marketing and communications across the EMEA region.
DELIVERING IT ACROSS THE MIDDLE EAST We at Mindware are proud to be the leading distributor of quality IT products across the MENA region – anticipating and servicing the complex needs of our customers.
w w w. m i n d w a re . a e
Mindware FZ LLC Office 205, Building 2, Dubai Internet City PO Box 55609, Dubai, United Arab Emirates Tel: +971 4 391 3333, Fax: +971 4 391 3334
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
SOLUTIONS (57) // SUCCESS STORIES FROM THE CHANNEL
NIGHT AT THE MUSEUM FOR UAE MICROSOFT SPECIALIST Itqan demonstrates its Microsoft Great Plains and HR solutions expertise by carrying out project to help Sharjah Museum simplify administration
S
ystems integrator Itqan Al-Bawardi Computers has carried out a Microsoftbased enterprise solution project at Sharjah Museum. According to Sofiane Benna, IT manager at Sharjah Museum, the organisation had a need to bring more automation to its internal processes. “The main objective of this requirement was to facilitate Sharjah Museum’s daily operations and allow employees to focus more on the essentials of their jobs and access the required integrated and business applications anywhere, anytime, through a web portal,” said Benna. “This automatically translates to higher quality standards and better productivity.”
S
The solution delivered by UAE-based Itqan encompassed different platforms that automate daily operations and create what it calls a “paperless, IT-enabled environment.” Itqan insists the Great Plains solution allows users to streamline, monitor and complete financial transactions with extreme ease and fluidity. It is also designed to provide a single, unified source of consolidated financial information for senior management to keep track of financial performance. “Itqan is a certified implementer of several business solutions, and from our portfolio of software applications Microsoft Dynamics Great
Plains is the best software fit for Sharjah Museum,” said Feras Al-Jabi, general manager at Itqan. “We have been recognised by Microsoft numerous times for our outstanding expertise and experience in implementing such a solution,” he added. Itqan claims that Sharjah Museum’s HR department has also felt the benefit of its work as daily tasks have been simplified and facilitated through eKawader, a payroll and HR solution developed and configured by Itqan. The company says eKawader gives users a complete view of recruitment without the need for paperwork and contains a module capable
of defining allowances, benefits and deductions to improve the payroll process. “The whole solution was implemented successfully despite challenges and complications that were finally overcome until the solution was fully deployed and users began to reap its benefits, which will get even more accentuated in the long run,” reflected the Museum’s Benna. “It delivered what we were looking for and made the job easier in many areas.”
Feras Al-Jabi says Great Plains software streamlines many user processes
AL FALAK LANDS JD EDWARDS PROJECT
audi enterprise reseller Al Falak Electronic Equipment & Supplies Co. is set to incorporate the JD Edwards
EnterpriseOne Collaborative Portal solution into the online self-service portal of assembly firm Al Rashed Fasteners.
Systems integrator to implement solution for Saudi manufacturer
The system, which is based on IBM’s WebSphere portal, will allow Al Rashed’s online users to manage and track data on the status of sales orders, shipments and deliveries. “Today’s tight markets require advantages in terms of speed, efficiency and information, all of which are supported by this technology,” stated Ahmed Ali Ashadawi, president and CEO at Al Falak (pictured). “Al Rashed will definitely gain an edge in its markets through the use of this solution.” Al Falak can speak from experience when it comes to EnterpriseOne as it recently adopted the system itself.
>>
.... .. ...
>]
=
{"|"}
*/
[]
[o]
\ -->
oo
{}
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
PRODUCTS (59) // MARGIN-MAKING OPPORTUNITIES
[] TABLET PCS
[] DESKTOPS
JOINING THE ELITE
TAKE A TABLET
HP believes new PC is ideal for business users
Fujitsu strengthens Lifebook PC range
A PC designed for customers demanding business-class security, reliability and stability is what technology giant HP claims its new Compaq 8000 800 Elite is able to offer. Built using the latest Intel Q45 Q4 Express chipset with GMA 4500 integrated gra graphics and Intel Core 2 Duo and Core 2 Quad processors, proce the product comes with support for DDR3 SD SDRAM memory and runs on Microsoft’s new Windows 7 operating system. To give customers peace of mind, mind the 8000 Elite is also available with ‘HP ProtectTools’ ProtectTo software suite, which includes a number of embedded em security features, such as a single sign-on and authentication tool. “HP is making enterprise-grade enterprise-gra technology and energy-efficient PCs more affordab affordable for customers who want energysaving feature features as well as improved security and manageability stated Salim Ziade, general manager manageability,” for HP’s Perso Personal Systems Group in the Middle East.
Fujitsu has introduced an alternative version of its Lifebook T5010 tablet PC that offers customers the option of a dual digitiser. “The Lifebook 5010 enables intuitive data input by automatically recognising if you have your active pen or finger near the detection-range tection-range of the dual digitiser, which is at the front of the display and acts ass either an active digitiser or touchscreen,” creen,” explained Chandan Mehta, product roduct manager at Fujitsu Technologyy Solutions. “In addition, the Windows 7 touch technology supporting the dual-digitiser allows ws multiple touch, recognising two touch points at the same e time,” he said. _WEBSITE: www.fujitsu.com
WEBSIT www.hp.com WEBSITE:
[]
[] KEYBOARDS
LAPTOPS
KEY TO SUCCESS Hardware H d ddevice i gives i gamers better control Microsoft has launched a keyboard that is designed to give gamers more control over their gaming experience. Featuring anti-ghosting technology developed by the Applied Sciences Group, the SideWinder X4 keyboard ensures the most complex key combinations are recognised by the computer to keep the game in action. Gamers can even press up to 26 keys at once, according to Microsoft, which says that the device also offers other advanced features such as macro recording, mode and profile switching and adjustable backlighting. The SideWinder X4 keyboard is available in the market from this month onwards, with a retail price of AED229 (US$62). _WEBSITE: www.microsoft.com
ROAD WARRIOR New VAIO model enhances mobile computing Sony Gulf has unveiled its latest range of VAIO notebooks, including the CW-series, which boasts a 14-inch display and compact body for enhanced portability. The CW-series integrates wireless LAN and Bluetooth so that users can surf the web while on the move. The hardware vendor says that the product is equipped with a Nvidia GeForce GT 330M GPU and 512 of VRAM, rendering ndering it more than andling 3D games capable of ha handling O top of that, and videos. On oasts DDR3 the laptop bo boasts d Intel memory and 0M M Core i5-520M S processors. Sony hee VAIO has made the vailable in CW-series available five differentt colours. _WEBSITE: www.sonymea.com
>>
.... .. ...
>]
=
{"|"}
* */
[]]
[[o]]
\ -->
oo o o
{}
// CHANNEL MIDDLE EAST_MARCH 2010
NEXT MONTH (60) // INSIDE THE NEXT ISSUE
COMING UP
THE MONTH OF APRIL CHANNEL MIDDLE EAST AWARDS Find out who won what at the regional IT channel’s most eagerly-awaited awards ceremony of the year, as we bring you all the coverage from the 2010 Channel Awards.
UNIFIED STRATEGY How do you sell unified communications (UC) to customers in the Middle East? We go to the key UC vendors in search of all the answers.
BOUND FOR AFRICA Vendors and distributors are ramping up their African businesses as they look to tap into the MEA region’s next big growth engine.
Q2 2010
EVENTS
Registered at Dubai Media City, PO Box 500024, Dubai, UAE Tel: +971 4 210 8000; Fax: +971 4 210 8080; Web: www.itp.com Offices in Dubai and London ITP Technology Publishing CEO Walid Akawi Managing Director Neil Davies Deputy Managing Director Karam Awad General Manager Peter Conmy Publisher Natasha Pendleton EDITORIAL Group Editor Mark Sutton Tel: +971 4 210 8225 e-mail: mark.sutton@itp.com Editor Andrew Seymour Tel: +971 4 210 8320 e-mail: andrew.seymour@itp.com ADVERTISING Advertising Manager Rajdeep Basu Tel: + 971 4 2108 344 e-mail: rajdeep.basu@itp.com Advertising Manager Kausar Syed@itp.com Tel: +971 4 2108 361 e-mail: kausar.syed@itp.com STUDIO Senior Designer Michel Al Asmar PHOTOGRAPHY Director of Photography Sevag Davidian PRODUCTION & DISTRIBUTION Group Production Manager Kyle Smith Deputy Production Manager Ali Fahmi Production Co-ordinator Basel Al Kassem Managing Picture Editor Patrick Littlejohn Image Retoucher Emmalyn Robbles Distribution Manager Karima Ashwell CIRCULATION Circulation Manager Shadia Basravi MARKETING
UAE 15th-17th March 2010: Future ICT Summit Presented by the Abu Dhabi Systems and Information Centre, and held in association with Injazat Data Systems and the Abu Dhabi Water & Electricity Authority, the Future ICT Summit is a brand new event designed to support the Abu Dhabi government as it explores the latest innovations and best practice use of technology for the planned delivery of a modern and efficient e-government platform. The conference, which will be held at the Abu Dhabi National Exhibition Centre, expects to attract 6,000 delegates to debate and decide the most effective ways to deploy IT and telecommunication systems throughout the UAE’s public service sectors. Some of the world’s top ICT experts have been lined up to share their thoughts on ICT strategy and development, while an exhibition of products from more than 100 companies will run parallel to the show. For more information visit www.futureictsummit.com
SAUDI ARABIA 25th-29th April 2010: GITEX All eyes will be focused on the Riyadh Exhibition Centre at the end of April as IT industry leaders congregate in Saudi Arabia for the ninth annual GITEX show. The KSA market is likely to be high on a lot of technology companies’ agenda given IT sales are expected to reach as much as US$6 billion in 2010. This year’s event will be accompanied by a series of workshops and conferences involving IT professionals from around the world. According to the show’s organisers, the conferences will provide an ideal opportunity to mix technical information and promotion, and present the latest developments and applications to an audience of distributors and decision-makers. In addition to showcasing new products and solutions from local and international companies, GITEX will act as a platform for the government sector to promote Middle East ICT initiatives. For more information visit www.recexpo.com
Marketing Executive Martin Chambers Event Manager Preeta Panicker ITP DIGITAL Assistant Editor Vineetha Menon Group Sales Manager Ahmad Bashour Tel: +971 4 210 8549 e-mail ahmad.bashour@itp.com Senior Sales Manager ITP.net Nathalie Akl Tel: +971 4 210 8520 e-mail nathalie.akl@itp.com Internet Development Manager Mohammed Affan Content Manager Asad Azizi Web Advertising Manager Meghna Jalnawalla Creative Director Craig Willers ITP GROUP Chairman Andrew Neil Managing Director Robert Serafin Finance Director Toby Jay Spencer-Davies Board of Directors K.M. Jamieson, Mike Bayman, Walid Akawi, Neil Davies, Rob Corder, Mary Serafin
Circulation Customer Service Tel: +971 4 286 8559 Printed by Atlas Printing Press Controlled Distribution by Blue Truck Subscribe online at www.itp.com/subscriptions The publishers regret that they cannot accept liability for error or omissions contained in this publication, however caused. The opinions and views contained in this publication are not necessarily those of the publishers. Readers are advised to seek specialist advice before acting on information contained in this publication, which is provided for general use and may not be appropriate for the readers particular circumstances. The ownership of trademarks is acknowledged. No part of this publication or any part of the contents thereof may be reproduced, stored in a retrieval system or transmitted in any form without the permission of the publishers in writing. An exemption is hereby granted for extracts used for the purpose of fair review.
OMAN 26th-29th April 2010: COMEX Now in its 20th successive year, COMEX is one of the largest IT, telecom and consumer electronics fairs to take place in the Gulf and gives the industry’s top brands a platform to showcase their state-of-theart products and services. Aimed at shaping the future of businesses and government, COMEX — which is held at the Oman International Exhibition Centre — offers the user community greater exposure to new ICT products under one roof and provides an opportunity for business-to-business alliances. This year’s attendees are expected to range from government departments and businesses to researchers, entrepreneurs and potential investors. The 2010 COMEX e-Government and e-Business Conference will be held parallel to the main show and promises to provide an insight into the latest solutions for both the government and corporate sectors. For more information visit www.oite.com/comex
_www.itp.net_
Channel Middle East is audited by BPA Worldwide. Average Total Circulation 7,567 (6 month audit Jul to Dec 2008).
Published by and Copyright © 2010 ITP Technology Publishing, a division of ITP Publishing Group Ltd. Registered in the B.V.I. under Company Registration number 1402846.
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
GET TO KNOW (62) // CHANNEL CHAMPIONS UNCOVERED
Shahnawaz Sheikh, Regional Sales Manager Middle East & Africa, SonicWall > What’s your career history in the industry to date?
> What do you enjoy most about working in the Middle East IT market?
I started working as a programmer of Cobol and Clipper in 1994 before I got into my first sales job with a systems integrator in Saudi Arabia in 1995. For six years I worked for a couple of integrators in KSA and India, honing my skills in networking, data centre and messaging solutions. I originally moved to the UK from India to pursue some opportunities, but when that didn’t turn out as expected I decided to go back and stopped in Dubai on transit. As fate would have it I ended up with a regional distributor (Westcon ME) in Dubai before moving to SonicWall in 2004.
There are many things I like about working in the Middle East. Firstly, Dubai, being a very cosmopolitan environment, gives you the opportunity to interact with people from different nationalities, cultures, lifestyles and thinking. Secondly, people in Dubai quickly grasp the language of technology. I am also excited about the ease and speed of doing business in Dubai.
As Middle East IT channel stalwarts go, Shahnawaz Sheikh is up there with the best of them. After serving in both the systems integration and distribution channels, he has since made his name as SonicWall’s regional boss...
> How would you describe your management style? My outlook is simple and practical. Plan, visualise and execute flawlessly — that is my motto. More importantly, I am a customer-oriented person with a helpful attitude and approach.
> What are your top channel tips for the next 12 months? > What is the best deal you have ever closed?
My tips for the channel for the next 12 months are to stay focused despite the challenging times we are in now, continue to offer quality service, and be unflinching and relentless in supporting the customer. The results of such an approach will be more clearly visible in the long run.
Being in sales I always believe that the best deal is yet to come. In fact that belief keeps me motivated every day. The day I feel I have got my best deal I may perhaps retire!
>>
.... .. ...
>]
=
{"|"}
*/
[]
[o]
\ -->
oo
{}
> What do you dislike most about working in the market? I can’t think of anything that I dislike having worked in the region for 11 years now. Every year I see new developments on the technology front, keeping me focused and excited about the IT market here.
> What is the proudest moment of your career to date? There are quite a few that come to my mind but the latest one is the success SonicWall has achieved in the Middle East. I was a one-man army when SonicWall started its operations in the region, but now we have a strong team of individuals in the region with a customer-centric approach to the channel and our end-customers.
> How do you relax outside of the work environment? I couldn’t have asked for a better way to relax than with my sweet little daughters Sobhia and Rabia. One of them is learning to speak and the other is learning to walk — both demanding my attention! Watching them grow relieves me of all the stress of work and frequent travel, and it prepares me for another bright day ahead. I also like to find time for my favourite sports — cricket to be precise!
RECOGNISING THE MIDDLE EAST'S CHANNEL CHAMPIONS
2010
MONDAY 22nd MARCH 2010
SUBMIT YOUR NOMINATIONS For more information please visit:
www.itp.net/events/channelmeawards For sponsorship opportunities at the Channel Middle East Awards 2010, please contact: Kausar Syed, Advertising Manager Tel: +971 4 2108 361 Email: kausar.syed@itp.com
Platinum Sponsor
Gold Sponsors
Rajdeep Basu, Advertising Manager Tel: +971 4 2108 344 Email: rajdeep.basu@itp.com
Silver Sponsors
// CHANNEL MIDDLE EAST_MARCH 2010
_www.itp.net_
COMMENT (64) // REACTION TO THE BIG TOPICS
Soundbites from the world of technology
} >>
.... .. ...
>]
We bring you a round-up of who’s saying what and why in the global IT channel.
This agreement not only reflects our continued focus on enhancing customer value by providing our channel partners with a wider choice of products and solutions, but also contributes to our objective of extending our coverage on new software solutions. Almasa’s tie-up with Ericom Software could just be the start of things to come, suggests the distributor’s software unit chief, Ilyas Mohammed.
For the first time, there’s a new family of Intel processors with the industry’s most advanced technology available immediately at virtually every PC price point. These smart processors adapt to an individual’s needs, automatically providing a ‘boost’ of performance for everyday applications. They become energy efficient to the point of shutting down processing cores or reducing power consumption to provide performance when people need it, and [being] energy efficient when they don’t. Intel’s general manager for the GCC GCC, Nassir Nauthoa, is convinced the CPU vendor will have PC users in the UAE talking after introducing its new Core i7, i5 and i3 chips to the market.
=
{"|"}
*/
[]
[o]
Given the extensive ICT developments in Saudi, our goal is to maximise the opportunities available in this market through more intensive awareness drives for the brands we carry. In addition to road shows such as the ones we have recently staged, we have strengthened our presence in KSA by adding more sales and technical talent on the ground. The boss of Redington Gulf’s value alue division, Ramkumar B, insists the distributor’s investments in the KSA market are there for all to see.
By uniting its rewards, training and marketing support for partners in a single programme, AMD is endeavouring to make the process of working with it much more streamlined and consistent. Having a single point of reference for information and resources should allow us to work together much more effectively, while the incentives and financial rewards offer the opportunity to go above and beyond target. ag a Prince Computers boss, Punit Jagada, gives the CPU vendor’s new channel programme the thumbs-up after its recent launch in the UAE market.
\ -->
oo
{}
{ With the new Professional Services Partner designation, Blue Coat has created an offering that enables partners to increase service attach rates and margins while building more strategic relationships with their customers. s Blue Coat’s worldwide channell sale sales rtn s chief, Jim Harold, promises partners that the launch of the company’s first professional services programme will lead to them making money.
We aligned our strategy and go-to-market on the SMB and consumer side approximately three quarters ago and one of the things that Lenovo did not have was coverage across the region. We had distributors trading from the UAE across the GCC and Middle East area, but our strategy is now to have a distributor on the ground locally in each geography. Ali Al-Amine, regional transactional on business director at Lenovo, explains the vendor’s aspirations to develop a solid in-country distribution network following the recent appointment of Metra in Qatar and the UAE.