The data center business is seeing good uptake but there is a dearth of
specialist solution providers who can cater to the burgeoning market. Do you
agree?
Yes, that is very true. There are no dyed-in-the-wool solution providers who
can offer a consolidated data center solution as a business opportunity. Most of
them either offer just piecemeal hardware or software solutions.
But this does not mean that vendors are not doing enough to provide the right
amount of knowledge to customers. However, whenever any vendor shares
information there is invariably some sales angle for pushing his own product in
the bargain. There is a need for vendor-neutral solution providers who can
enlighten people on how to start a project around data centers and give them a
consolidated view of the challenges they are likely to encounter.
APW President had posted a turnover of Rs 129 crore in 2006-07. This year
you have set yourself an ambitious target of touching Rs 160 crore in revenues.
How do you propose to achieve this?
We believe that while the percentage of IT spending in enterprises will be
single digit it will be in double digits in the small and medium business (SMB).
This is why we have taken a strategic decision to focus on the SMB market this
fiscal.
Also, we have realized that if we want to tap the SMB market then we need to
have more feet on the ground. This is why we are going to work very closely with
the channel, which will help us go to those areas where we might not be directly
present. This is also because most SMB customers are comfortable working with
one solution provider for all their needs. In such cases, the partner has the
customer mindshare and would be able to position our products in their stack of
solution offering.
We are also creating products best suited to this clientele like the rack or
intelligence rack, which is an integrated rack solution. It is a preconfigured
rack where all customer data can be stored.
What are your channel plans keeping this change of focus in mind?
We have created a new channel program called the President Business
Association (PBA). It's a loyalty club and we will offer a lot of benefits to
partners who are enrolled in this program.
According to our database, we have around 3000 channel partners of which 500
are active, which means that they have bought something from us in the past two
years. Now we want to have more partners directly working with us and getting
trained and certified by us.
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Pramod Agashe
COO, APW President |
Right now we have 17 partners who are enrolled with us. In some cases they
are our stockholders, some are marketing companies while others are sales
agents. We now want to have a simplified channel structure and are aiming to
have 50 partners within the PBA network by March 2009.
That is not a very high number you are targeting?
I think if we can bring in these many partners on board and they bring in
around Rs 40 crore of business then APW can well achieve its turnover target of
Rs 162 crore.
What will be the distribution model you will adopt?
At present we are working on it. We don't see ourselves working with any
national distributors. This is because national distributors are more of
logistics partners than a market-building source. Besides warehousing our
products can also be a challenge for national distributors because a rack takes
a lot of space. Plus, every rack is in a knock down condition and it has to be
assembled together and could have various permutations.
So we can work best with solution providers who have been trained by us to
build these racks. We will manage the logistics initially.
Have you identified the company who will take the 30 percent stake held by
APW Electronics in your company, since the latter is in receivership?
We are in talks with an organization to take over the 30 percent stake held
by APW Electronics in the company. The UK-based APW had filed for receivership
and since January 2008, we have been discussing with other vendors for transfer
of this stake. We do not want a mere venture capital company to invest in us.
Instead we want a technology partner whose offerings will complement ours so
that we have a unified stack of solutions to take to the customer.
Is there any specific kind of partner that you are looking at for
technology sharing within your company?
In the present scenario, we are looking for diversified partners who can
offer different technology product lines in verticals like BPO, manufacturing,
health care, entertainment etc. We are not interested in pushing our products in
just one segment.
Though our partnership, we want access to mutually beneficial technology.
This is because racks will be purchased by all organizations going for IT
infrastructure. But we want to work with companies that have products that work
with racks and can be offered as a value proposition.
How big is the enclosures market in India?
APW President specializes in electronic enclosure systems, a market worth
around Rs 450 crore and we have a 30 percent market share. Our primary business
has been the manufacture and sale of standard electronic enclosures for
technology firms like Cisco, IBM and Dell, besides customers in the telecom
space such as Reliance, Vodafone, Nokia and Ericsson.
Since 2002, the company has been involved in contract manufacturing, which
accounts for half of its business, with customers including Ericsson,
Nokia-Siemens, NCR, Reliance Communications etc.
Recently we entered into an arrangement with UK-based Global Datacenters
Management (GDCM), to distribute its 'nlyte' product for India and the
Middle-east region. This is a solution that lends itself very natural to the
data centre environment because it helps in monitoring the resources used in the
centre and how this can be optimized.
Archana Swamy
(archanas@cybermedia.co.in)