Westcoast is eyeing new technology areas such as VoIP and virtualisation as it celebrates a 23 per cent leap in turnover for its FY2010.
The Theale-based distributor saw sales for the combined Westcoast group (including reseller business XMA) hit £958m for the year ended 31 December 2010, compared with £780m the previous year. Operating profit rose 27 per cent to £7.7m, compared with £5.6m the previous year.
Speaking to CRN, Duncan Forsyth, managing director of Westcoast, said expansion to new areas was key to maintaining growth.
“Traditionally Westcoast has been viewed as a box shifter, rightly or wrongly, but we are now demonstrating that we have a very strong solutions business and we can support resellers to sell,” he said. “All our vendors have performed strongly and we have grown across the board. There is more certainty this year and it generally feels more stable, but I think we are in for much of the same this year, with things remaining fairly flat.
“To continue growth we need to invest in new technology which is what we are doing in the virtualisation and VoIP telecom sectors, particularly with vendors such as HP and Microsoft.”
Forsyth added the distributor would either look to acquire or invest in recruiting individuals with the right skills to further develop its reach in the sectors.
“We are certainly looking for acquisitions, but at the moment it is a difficult climate in which to acquire and in the meantime we will drive organic growth," he said.
Simon Welch, product marketing director at Azlan, said Westcoast was making the right move.
“It makes sense. You have to push up the value chain or go vast and deep to drive down costs. The sensible bet is to push up the value chain and help the channel make the move to cloud computing. We are all at it.
“Whatever the value proposition is, there has to be one in place, because this is ultimately about survival,” he said.
Another area in which Westcoast has invested is credit, creating a dedicated "risk" team of eight people.
“This team identifies firms that insurers and banks will not support and offers them credit," Forsyth explained.
"In the past our industry has relied too heavily on credit insurance and it became an ever-decreasing circle. But we have found that there is more preparedness for both sides to work together. All sides recognise the importance of credit and how trust needs to be built up.”
Commenting on the speculation that the distribution landscape will shrink to just four main players consisting of the 'big four', Forsyth gave a different perspective.
“If you look at Europe, the biggest players in each market are the local players. Westcoast is the largest [local player] in the UK and I am not nervous about making that statement. I still have vendors coming to me asking me to run their programmes because we can move quickly and directly, unlike the larger, multinational players.”
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