Westcon aims to fortify MEA presence [ITP.net (United Arab Emirates)]
(ITP.net (United Arab Emirates) Via Acquire Media NewsEdge) Channel Middle East spoke exclusively to Dean Douglas, president and CEO, Westcon Group about the company's recent acquisitions and how it's cementing its MEA presence.
Having recently acquired Comztek, a specialist networking solutions distributor based in South Africa and Afina Group in North Africa, Westcon Group is on a mission. The distributor, which already has presence in all six continents across the globe, has continued to invest in emerging markets.
Westcon Group's CEO Dean Douglas, said over the last several years, the company embarked on a strategy that focused on broadening its geographical reach, while maintaining consistence in the line card. "In the five years that I have been with Westcon, we have moved from 20 countries and revenues that were 70% generated in North America and accounting for 80% of our profits, to a global operation that is present today in over 70 countries," he said.
Douglas said Westcon is a distributor present in all six continents across the globe and about two-thirds of its revenues and profits come from outside North America.
With Westcon growing its clout in the MEA region, where the distributor says it's witnessing significant business growth, it comes as no surprise that its latest acquisitions have seen in buy companies in North and South Africa. "The acquisition of Comztek gives us a larger presence not just in South Africa, but also in sub-Saharan Africa," he said.
He added that the Afina deal expands Westcon's presence in Latin American, Iberia and North Africa's Maghreb region. "We see the business in the MEA region to be larger than the GDP that the area represents and it's a geography that has significant opportunity for growth not just for us but the vendors we represent and the reseller partners we serve," he said. "I came here to talk with the rest of the emerging markets team about the opportunities that we have across the region. When we look at our break out, it's about a third of our business from North America, a third in Europe and another third coming from emerging markets of which the Middle East and Africa is a larger part of that."
Apart from courting coverage and exploiting business opportunities in the MEA region, Westcon has been honing its value-add business model across the various theatres around the globe.
"Before I joined Westcon, I spent a decade managing businesses that were service focused specifically – financial services. If you think of the financial services business, it's not a manufacturer or software developer, but it's a business that really sells the people that work for it and the intellectual capital," he said.
Douglas explained that it's the people skills, capabilities and methodologies that a company puts forward as a business that differentiates it from its competitors. "For Westcon and any value-add distributor, it's the same thing. It's about the people as we don't manufacture products, we don't red code but may integrate products in the final assembly," he said.
He pointed out that it's the people that establish relationships with customers or the vendors thereby creating the differentiation that is need in the market. "Because we have been around the EMEA region for so long, we have a very capable management team backed by a capable workforce," he added.
Douglas said the key piece to Westcon's success in the market can be attributed to having the right methodology and business model, and how it approaches the different markets. "We have some very solid people and I know this comes across as CEO-speak but in the business we are in, it is the differentiator. It is how we differentiate ourselves from our rivals that we have been able to fortify our presence across the globe," he said.
With its global expansion drive now complete, Douglas said at this juncture the company has no immediate or further expansion plans. "There maybe a few countries that we need to get into, but I think we have done a good job of getting into the places where we want to be present in," he said.
Douglas said the global expansion drive stemmed from a vendor need to be served by a distributor that had global reach. "The vendors we have were looking for a player that could represent them in a consistent way across all markets. The more difficult the market, the more important we became," he said. "So we thought it would be important for us to have a global reach in order to represent our vendors in a consistent fashion, putting together channel enabling programmes, support and training schemes."
Douglas said for the reseller base and from a service provider, and systems integrator perspective, they are doing cross border transactions and so, they are also looking for consistence. "In many cases they are looking for a partner that's reliable, is large, covers the entire region and can provide channel enabling initiatives and marketing programmes tailored for a specific region or market," he remarked.
As new technologies come into the market either new software products in the security space, cloud or cloud deployments, that ability to have global presence that SMBs could draw from, has become crucial.
To this end, Douglas said Westcon has a number of cloud initiatives in the marketplace which it's piloting in conjunction with Cisco. "We have been doing certain trials and testing solutions to ascertain how these would work in a cloud environment. We will be working on a couple of cloud initiatives that we haven't announced yet. We are going to start providing Cisco infrastructure as a service in certain markets. It will be the same thing with Cisco's Hosted Collaboration Solution (HCS) platform, where we are going to help a reseller partner go to market with that product as a cloud provider," he said.
Douglas said in addition, Westcon is working on a couple of initiatives that it will be piloting and one of those projects is a robust set of capabilities with the core being an aggregation platform.
He said the first of the platform is a capability that the company is calling the 'billing sub-system' and it allows for real subscription billing. "We believe this is going to be overwhelming for most resellers and large systems integrators playing in the cloud space. We feel we can play a part in helping them create this billing sub-system," he said.
With a strong vertical market and technology focus, Westcon says it has what it takes to forge new alliances for success in all the markets where it is present in.
Steve Lockie, group MD, Westcon Middle East, added that the technology verticals that Westcon has within its stable include network security, physical security, mobility, networking and data centre solutions. Lockie said the company has some strong vertical market offerings in the public sector, retail, health, transport and logistics, and hospitality in MEA. He added that depending on the market, the business has a different touch. "The beauty about the business model that Westcon has is that because of the technology-focused business units, certain technology offerings will be very strong in a given vertical market segment. For example, the collaboration business is strong in the education sector, while the Comstor business is solid in the infrastructure space," he said.
He pointed out that what is important for channel partners is that there is always an opportunity to cross-sell. "I think it's safe to say that we are not in a market that is opportunity restricted. We go into any vertical market when we see an opportunity and have the capability and capacity to address that identified market or vertical," Lockie said.
Douglas agreed and said the biggest challenge that Westcon has had is geographical presence and this is going to continue for some time. "If you look at the MEA region for example, there are about 68 countries and we are not going to cover all these countries, but we will make sure we cover the primary ones," he said. "Right now there is a lot of discussion around the countries we need to have presence in, how robust the presence should be and how do we expand that presence in-country. He said in the Middle East, the company still has many gaps and it is addressing those gaps and how to fill them. "We need to have relevance for each one of the regions, but also weight in each one of the countries. I don't believe there is a distributor that is as robust and has a footprint geographically as we do. Our capability and ability to address markets in all the six continents sets us apart," Douglas said.
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