Sealcorp Australia has announced a move away from its distribution centric business model, emphasised its small to medium business (SMB) services focus and renamed itself Brocker Vendor Services.
The rebadged version of the old Sealcorp will become just one of four pillars in the local operations of its NASDAQ-listed parent Brocker Technology Group (BTG). Under a reinvention of local operations announced last week, the organisation will aim to more closely resemble its parent with two new business units being cranked up and the fledgling Pritech professional services arm given a booster shot.
In a frank interview with ARN, BTG's Australian director, Chris Spring conceded its current business model was unsustainable in the long term. As a commercial organisation using IT as a vehicle of growth, it needed the addition of complementary and more profitable revenue streams to its distribution, he said.
The group of companies will ignore the enterprise space choosing instead to focus on SMB opportunities which has been its strength and where Spring feels there is the most growth potential.
"There is just not enough margin and nowhere to add value for us in the enterprise space," Spring said. "Vendors are handling more of the sales process themselves and only need distributors for fulfillment.
"But in the SMB space, we are extending the vendors' reach by acting very much like them for the channels that don't have sufficient revenue stream to be serviced directly."
Spring said the move into services and application development is essential to sustain growth and avoid future oblivion.
Flush with funds from its recent Nasdaq listing, BTG is on the acquisition trail in Australia to bolster and/or supply start-up human resources and intellectual property for the new and enhanced divisions. However, this "will not be in distribution", according to Spring.
"For us to survive we had to find ways of achieving that in a channel friendly manner. If we didn't take the steps now to change, particularly as a niche player, then it would be too late."
Sealcorp recently attracted headlines after Novell left the fold and IBM confirmed its was reviewing its relationship with the distributor.