CC ready to invest in mid-market

Firm has big plans for mid-market space as it hails its UK business the 'star performer' for 2006

Computacenter is planning to plough around £5m into further developing its mid-market business in 2007.

As revealed by CRN Online, the IT and infrastructure giant saw operating profit increase 14.5 per cent to £33.6m in its preliminary 2006 year-end results, despite a slight drop in turnover of £2.27bn compared to £2.29bn in 2005 (CRN Online, 13 March).

Mike Norris, chief executive of Computacenter told CRN the UK had been the ‘star performer’ in the group.

“Certain types of our business have grown successfully and others have yet to pay off,” he said. “It is fair to say that we had a poor year in product terms in 2005, but we have found ways of improving this by taking some cost out and improving business control processes.”

Norris said the UK is not going to see a ‘massively exciting year’ in 2007, but added he is feeling “cautiously optimistic” about the BT services contract, which runs out at the end of this month.

“However we intend to spend £5m investing in our UK mid-market business this year,” he said.

Norris added the European divisions of Computacenter were set to improve performance.

“The market in Germany is pumping now due to its strength in manufacturing, and I think this could be our star performer this year. France is a difficult place to make profit but we are doing our best to patch it up,” he said.

Thomas Poedenphant, managing consultant at Pierre Audoin Consultants said Computacenter was wise to stick to the mid-market.

“If you compare Computacenter to the bigger managed services players such as EDS, these firms are turning over £1bn in services revenues alone in the UK, whereas it is turning over just over £100m. There is no way it can compete. However it is well placed to go for the smaller deals which are still very infrastructure based and more suited to its capabilities.”