Eating your own dogfood is a tried and tested way to demonstrate faith in your own product. Just ask the channel’s latest 3G evangelist, Michael Bosnar – the eXeed director said he had been running his sales and marketing company using a 3G handset for the past six months.
But no matter how foolproof your technology might be, acts of God can still come along and stuff things up. In this case, Bosnar said he was among those who lost phone service for three hours during freak storms which lashed Melbourne in December last year.
But freak weather aside, Bosnar said that after initial teething problems in early weeks, he now experienced less call dropouts in Sydney than he did with Optus. In fact, he said he was so confident that he migrated his whole sales team to 3.
eXeed jumped on the 3G bandwagon this year, keen to pursue channel opportunities associated with the launch of Hutchison’s 3 network. While traditional IT still makes up the lion’s share of eXeed business, Bosnar claimed 3G and associated applications and services already represented 40 per cent of his business.
In fact, it was this new focus on 3G that Bosnar said had taken his mind off the merger and acquisition trail of 2003, that saw eXeed walk away from two high profile deals – the first with Dicker Data, and then Digiland.
A non-disclosure agreement has prevented Bosnar from talking in depth about the collapse of the Dicker deal.
“All I can say at this point is there was an opportunity there and I guess for the right price and the rights terms it would have been a good marriage,” he said.
Similarly with Digiland, the sticking point was finding the right price. This time, however, the deal came so close that both companies had publicly announced that Digiland would migrate branded business to eXeed, and focus on its whitebox vendors and customers. But a failure to agree on terms saw the deal fall apart at the eleventh hour.
“They were looking for someone to drive their whitebox business, but their funding of it was not a priority for them,” Bosnar said.
But eXeed didn’t walk away empty-handed, picking up a lucrative Acer distribution agreement, along with access to Digiland’s customer records.
With the two close calls behind it, eXeed is twice bitten and twice shy when it comes to distribution mergers.
While Bosnar would not rule out investment in other companies, he said he was not shopping for another distributor. He had lost his taste for investment in the IT space because the value was gone.
Bosnar sees eXeed as a new breed of distributor of new, higher value technology.
“After running a traditional distributor for nine years, I felt the market was changing," he said. "The channel is looking for more than pricing, availability and credit terms.”
Bosnar came to eXeed following a stint with Prion Technology Distribution in the late 1990s, and a spell on the executive team of reseller AAG, where he was Victorian state manager.
The traditional broad-based distribution approach – which involves logistics, sales and marketing across a broad range of product lines - was prone to confusion, he said.
eXeed, formed in August 2001, has three major shareholders – Bosnar, Frank Colli (also the managing director of Leading Solutions) and NZ-based Keith Watson.
The business model focuses on a few vendors, coupled with a seamless electronic link between vendor and resellers, he said. Logistics are outsourced to companies like TNT.
Bosnar said the outsourcing of logistics, protected by tight service level agreements, improved stock holdings. “Really it’s the only way to compete against Dell,” he said, pointing to companies like HP that had begun to divide European partners into business development or logistics partners.
eXeed’s investment priorities were now infrastructure, resources and people, to support its focus on new business, he said: “The mobility space is where it’s going, and 3G is at the centre.”
In Bosnar’s vision, the 3G wheel is supported by spokes that include hardware such as tablets, notebooks and handsets, as well as 3G applications, services, insurance, and accessories.
Most recently, the company had begun signing up local independent software vendors to take their 3G applications to market. It recently began marketing 3G applications from Retriever and Teleffective applications into its reseller channel.
eXeed now boasted 26 gold reseller partners of its 3 business, Bosnar said. They came from both IT and telco backgrounds, selling into verticals like real estate, construction and security.
So far it was the smaller resellers who were getting on the 3G bandwagon, he said.
“I’ve seen three or four of the bigger players – they all have mobility in their sights," Bosnar said. "They see the services revenue, and applications – which tie the customer into your environment. But the bigger resellers are really slow in their uptake. They can’t chop and change so quickly.”