Proximity cashes in on heritage Nortel demand in growth spurt

VAR ponders more acquisitions as skilling up on technologies new and old pays off in FY11

After growing past the £10m sales mark in 2011, comms and network VAR Proximity Communications is banking on its heritage Nortel expertise to help it continue to secure lucrative custom.

The Berkshire-based firm saw revenue grow more than 20 per cent last year to £10m, with operating profit more than doubling to £800,000. It was also a year of change for Proximity, during which a chief finance officer and operations director were put in place. The reseller also trimmed its portfolio to refocus on four key vendors: Avaya; ShoreTel; Aerohive; and Teleware.

Stuart Legg was another senior hire at the time, joining as sales and marketing director a year ago. He told ChannelWeb that, in addition to skilling up on new technologies, Proximity is winning a great deal of legacy-centric business through its third-party services arm APSL.

"[Last year] we went back into our base and expanded the conversations that we were having. We also targeted our competitors' bases and we won a lot of new business, particularly on the ShoreTel side," he said. "We are seeing more and more opportunities in the old Nortel base. So many of our competitors are no longer upskilling and there is a massive base out there that still needs servicing."

Since Avaya's acquisition of Nortel in late 2009 Proximity has cemented its relationship with the fallen Canadian vendor's new owner. The VAR's chief executive Darren Boyce claimed that "over the past three to six months" Avaya has implemented a channel strategy and product road map that "justifies the pain of the past 18 months".

Proximity also intends to make investments in skills and personnel that will allow it to follow Avaya into the video space, said Boyce.

"If you were a data provider getting involved in IP voice it was a big investment, and video, [like voice], is another application on the network," he said.

Proximity is projecting to post 20 per cent-plus top-line growth again in 2012, and has already boosted the headcount of its operations team by 12 so far this year. The VAR is also bringing in a graduate scheme, which will allow new hires to get a diverse business education for a year, before deciding what kind of role might best suit them.

The firm, which was formed in 2009 through the merger of rivals Applinet and Unified Group, is currently sitting on a £2m cash pile. Boyce indicated more acquisitions could be on the cards, should the right opportunities arise.

"An acquisition would not be off the table for us; we would be looking for a level of technical ability that we could integrate [with what] we already do," he said.