Exact expands throughout the region

Exact Software intends to open six more offices in the Middle East over the next 18 months as it ramps up its regional operations.

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By  Matthew Southwell Published  June 3, 2004

|~|exactuse_m.jpg|~|Exact Software will be staffing its new offices with local recruits, says Nizar Badwan (right).|~|Exact Software intends to open six more offices in the Middle East over the next 18 months as it ramps up its regional operations. Points of presence will be established in Saudi Arabia, Kuwait and Qatar over the summer, while offices in Oman, Egypt and the Levant will follow in the autumn. The Dutch enterprise resource planning (ERP) application vendor is currently scouring the Middle East market for the human resources it requires to staff its new network of offices. Each office will have a minimum of eight employees to cover sales, support and administration, while larger operations like Saudi will have more than 20 staff. “We believe that we need to recruit from the local market, so when we work in Saudi Arabia we have people that know that market working for us. The same goes for Oman and the other countries we are expanding into,” says Nizar Badwan, general manager of Exact Software Middle East. “In terms of support, we are evaluating whether it makes sense to have centralised support or whether we should do it in each country. At the minute we are leaning towards distributed support centres with regional back up,” he adds. Exact Software’s aggressive expansion plans are part of a global strategy that will see the Middle East become one of its four key markets. The ERP provider believes there are thousands of potential customers in the local market and that the six new offices will help grow regional revenues by 25-30%. Exact is targeting international companies operating in the region and homegrown multi-site organisations. Although many of these companies have already invested in ERP applications from the likes of PeopleSoft or SAP, the Dutch vendor believes it can persuade a number of them to migrate to its offering, or deploy it in satellite offices that do not require a tier one solution. “We have a list of prospects by country and it is in the low thousands. There are international companies on that list and large local companies that qualify as international companies as they have operations throughout the GCC,” explains Badwan. “Many of these companies have ERP in some form or another. We want them to either migrate to Exact or extend their offering with us,” he says. To attract some of the 1000-plus companies it has identified as potential customers, Exact is busy promoting the extended ERP capabilities of its suite. It is also touting the software’s native Arabic support and local customisation. In addition, as a vendor that works direct with customers rather than through systems integrators, Exact is also keen to play up its ability to partner with companies and deliver long-term value. The latest manifestation of this is its “parenting approach,” through which the Dutch vendor aims to become a customers’ preferred supplier. However, in a market where users have been known to trade in longstanding relationships for a few free licenses, Exact will have to continually up its services ante. “This is one of the key reasons we are pursuing our expansion strategy,” says Badwan. “We do not want to get into a price war and we decided that if we had a unique offering then we would be able to compete. Our pricing is very competitive so customers get the benefit of this but also of our very good infrastructure and our after sales support,” he adds. Another tactic being pursued by Exact in its attempt to garner greater local market share among multi-site companies is the application service provider (ASP) model. Although the vendor has no desire to host, it is looking to partner with existing Middle East providers to tempt users. “We are talking to the likes of ASP Gulf to see if we can create a solution that leverages our strengths,” says Badwan. Exact is not alone in enhancing its Middle East’s focus as software vendors clamour for a slice of an ERP pie that Madar Research believes will be worth an estimated US$270 million by 2008. In addition to the traditional tier one and tier two players such as Sage and Microsoft Business Solutions (MBS), local systems integrators are also ramping up their efforts. For example, Al Falak is currently plugging its PeopleSoft-Retail Pro offering for the local retail sector and believes adoption is set to soar. “It is significant that the largest demand for ERP solutions is in the retail market in the GCC. While the manufacturing and financial segments of regional markets had the financial means to invest in the costlier ERP solutions of a decade or so ago, the retail market... has only recently begun to benefit from newer ERP suites that are more flexible and more modular, as well as taking less time and money to implement,” says Ahmed Ali Ashadawi, president & CEO of Al-Falak.||**||

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