Stuart Smith took over the managing director’s reins from Cellnet founder, Stephen Harrison, earlier this year after spending a year as CFO. He inherited a battle-scarred but newly focused distribution company, which has rebuilt its foundations around two key areas: The IT server market, and retail/telco. Smith caught up with NADIA CAMERON to talk about the distributor’s recovery plans and goals for the future.
What’s your key focus in the new role?
Stuart Smith (SS): The first thing is to focus the business into the two segments we have got – retail and IT. We have combined the retail and telco sectors together and have one focused sales team that is 100 per cent customer focused. The same principle applies to our IT team – we want to be very customer focused and provide more service than our competitors, and a superior level of service, to our resellers. If you step back from that, we have to make sure we don’t have any working capital constraints and make maximum use of our working capital to provide the most benefits.
How will you ensure Cellnet remains profitable, especially given what is happening in the broader economic market?
SS: I think it comes down to exactly what we have done, which is staying focused. We can’t be everything to everybody. Competition from the global players is significant and the global economies of scale they have access to are not available to us. We have to very much focus on what we do best and provide a superior level of customer service.
Can you sum up what it is Cellnet is striving for?
SS: We are striving to be the best at what we do. I don’t want to sound like a cliché, but providing the best level of service we can, focusing on the customer, and being the best with a more defined set of products and channel to market is our goal.
Will we see Cellnet revisit some of its former vendor relationships, given the decision made last year to exit the PC market?
SS: In terms of existing vendors, absolutely. We are always looking at new vendors, so it’s not about necessarily revisiting old relationships, but certainly looking at more products which are complementary to the existing product offering we have, or the offering we intend to have going forward. Whether that involves some of the previous vendors, yes if need be. We still have good relations with the vendors we don’t deal with to the same extent we dealt with before. We still deal with Acer, Asus and Lenovo, but the extent of those dealings have changed.
What are the key technologies for Cellnet?
SS: On the IT side, the offering is very clear: It’s around the server and getting a solution to the reseller and end customer. We will be putting out shortly how we intend to expand in that area, but it will be complementary to the core offering we have there. On the accessories and retail side, we have our lead memory product, SanDisk, and we do Transcend as well. That area is also fairly focused and we have significant market share in that space. With retail, we’ll be introducing new packaging, together with innovative products such as the Free2Talk [BC900 handsfree car kits] we just released, and moving more into the eco-friendly side of the market. The cost of green offerings used to be at a cost premium, but that differential has reduced and will continue to drop.