Distributor, Westcon Group, is embarking on acquisition strategy to boost its presence across the Asia market.
In the past 15 months, it opened three offices in South East Asia and purchased Datastor in New Zealand.
Westcon Group Asia Pacific vice-president, Wendy O’Keeffe, said business in the region had grown 25 per cent based on top line revenue in new countries it has entered into. She expects to expand into a $1 billion business across the region in the next two to three years.
Within Asia, Westcon focuses on what it determines are three core markets including – mature markets (Australia, New Zealand and Singapore); emerging markets (Vietnam, Thailand, Philippines and Indonesia); and countries that it currently doesn’t have a presence in such as China, Taiwan, Hong Kong, Korea and Japan.
“To have good coverage in Asia, you need to be in about 14 countries across the region,” O'Keeffe said.
Across South East Asia, Westcon is looking at acquiring three to five companies in emerging markets that could bolt on to what it already has across certain technologies such as security, datacentre, software or channel services, O'Keeffe said.
“North Asia is where we really have to expand. I’ve been fortunate enough to get the acquisition team from our parent company and they’re going to spend a couple of months in Singapore looking at the market and potential acquisitions, particularly in new and emerging markets,” she said.
Some of the criteria involved when looking at acquiring a company includes the core business focus and how it fits; value in the customer base; gaps that could be filled in the market; and profitability of the business, O'Keeffe said.
“The reason we need to expand in Asia is because our customer base is demanding it. Our vendor relationships also want to be global,” she said. “There’s a lot more movement with customers that want to deal with companies that are global.”
Part of the growth strategy for Westcon also includes optimising its mature markets. Due to the Datastor acquisition, O’Keefe said its New Zealand business had grown considerably and has since put in a stronger management structure and set up a vendor division.
“We finished last year with incredibly strong growth of over 40 per cent in that market," she said.
In Australia, the distributor is opening a new Adelaide branch this month and will shortly announce who will head up the office.
“Adelaide has always been serviced out of WA, and we think there’s opportunity there for us to grow,” she said.
O’Keeffe highlighted Indonesia as a key growth market for many technology companies and is in the process of hiring about 15 staff. She is also expecting to achieve double digit growth in Singapore.
“We signed up EMC in Singapore and launched a datacentre and infrastructure practice similar to what we’ve done in Australia,” she said. “There’s a lot of opportunity in the finance sector in Indonesia and Cisco have just appointed us in Indonesia from a specialisation perspective in datacentres.”