Networking distributor reveals change in strategy

Networking distribution house Online Distribution has overhauled its internal set-up in favour of a model that positions the business around several dedicated technology divisions.

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By  Andrew Seymour Published  May 21, 2007

Networking distribution house Online Distribution has overhauled its internal set-up in favour of a model that positions the business around several dedicated technology divisions. The re-jig, which the company claims is being augmented by a “significant” recruitment and expansion drive in the MENA and Western Asia region, has led to the development of four major business units. This includes enterprise mobility, enterprise business, network infrastructure and security. Responsibility for specific vendors will sit with the different units, according to the company. Online carries a number of brands in its portfolio, including APC, 3Com, Secure Computing, Trend Micro and Juniper. Online insists the reorganisation will provide it with the focus and specialisation required to prevail in a networking channel that is becoming increasingly sophisticated. Each business unit will be lead by a senior team member from inside the company’s operation and supported by high-level technical expertise specific to the needs of the channel partners. “We have made the decision to structure the company around the new business units in order to build on our leading position in the regional market. Increased focus will provide an increasingly sophisticated level of support,” said Venu Menon, sales director at Online Distribution. “Working with our vendors, we aim to demonstrate the collective strength of the latest generation of network technology solutions at the same time as providing specialised services for all our partners,” he added. Confirmation of the new business structure comes less than a week after South African parent Datatec revealed Online recorded EBITDA of US$3m on sales of US$45m for the 12 months to the end of February 2007. That performance compared favourably with the US$2m EBITDA on sales of US$34m that Online posted the previous year. Meanwhile, the overall Datatec Group, which consists of a mixture of distribution and reseller entities, grew turnover 17% to US$3.2 billion and registered an operating profit (before goodwill adjustment) of US$100m. “We have achieved another year of strong organic growth across the group with notable increases in profitability and market share from Westcon and Logicalis, and an increasing contribution from emerging markets,” stated Datatec boss Jens Montanana. “We have also completed a number of acquisitions around the world which have significantly increased Datatec’s scale, as well as enhanced our product mix and geographical presence. All of these factors have enabled us to grow our profits and improve our margins,” he added.

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