Pulling up a seat

Soaring growth in its Saudi and Egyptian operations has propelled BDL into a formidable distributors.

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By  Andrew Seymour Published  July 9, 2008

Soaring growth in its Saudi and Egyptian operations has propelled BDL into one of the Middle East's most formidable distributors, but the launch of a UAE-based Gulf subsidiary at the end of last year really announced its arrival on the regional stage.

Six months on, Sunil Nair, general manager at BDL Gulf, reveals how much progress has been made.

So which brands does BDL Gulf now have authorised distribution rights for?

We have authorisation from Dell for Kuwait, Asus and US Robotics for all territories, and LG notebooks for the UAE. We have Creative for Africa so that's a little bit varied, and Swiss Travel and Lexmark. We have seven or eight vendors, plus we are an exclusive distributor for BenQ notebooks.

What about Logitech? That was a brand you were linked with.

No, we don't do Logitech. Unfortunately what happened is that discussion almost came to finalisation with [regional manager] Ahmed Khalil and then he left.

Are you approaching vendors as the BDL Group or on a country-by-country operation basis?

Some brands would only like to appoint us in a particular territory but Mr Waleed [Al Saud - BDL chairman] has said that it is becoming more difficult to manage these kind of relationships so he's of the opinion that we would like to be given regional [contracts]. Only being authorised in, say, Qatar, becomes too much of a hazard for us in terms of investment and focus so now we are consolidating everything and going for key brands regionally. We cannot keep investing in a brand or product in only one country - it becomes complicated in terms of storage as well. The benefit comes from volume.

How many staff do you have working for BDL Gulf?

We have 40 people and that's not actually enough because we have had to recruit for the in-country operations in Kuwait and take one more additional warehouse in Dubai for customs cleared goods for power retailers. I never knew it would grow so fast, but there are a lot of operations happening and a lot of people are needed to manage the customs cleared goods business outside of Jebel Ali.

BDL Gulf previously said that it was aiming for revenues of between US$80m and US$120m during its first year of operation. Is that target still realistic?

From the way it is going I'm sure that US$80m becomes the conservative figure. The realistic number is between US$100 and US$105m - that is going to happen. I am very confident about that, especially because of some new developments that we have coming up, which are going to take us into the big league. Even when we submit the half-year financials to the bank I guess we will be doing about US$40m.

Is most of the business so far coming from traditional IT dealers?

It's a mix actually. In terms of revenue it is largely coming from the traditional reseller channel, but interestingly our acceptance into the retail market has happened much earlier than I expected.

Why is that?

Perhaps because of the infrastructure we have for the customs cleared goods and immediate delivery. We have been able to deliver instantly and, for me personally by virtue of my earlier time with Microsoft, I know all of the companies and their style of operations. I am not shocked when they ask for consignment business or some stock rotation because I know how they work and I can immediately sign the contract.

There is intense competition among large volume-focused distributors based in the UAE. How is BDL Gulf differentiating from other large IT wholesalers?

Luckily for us, we don't have many products that overlap with those giant distribution companies. For example, BenQ is almost exclusive with us, they don't have any other partners for the notebook business except in Qatar. With Asus there is only one other partner, which is Almasa, and I am comfortable with that.

Again, with LG notebooks there is only one other partner, and for Creative in Africa I think we are the only one too. So we have not faced that issue - the product profile is largely different from those companies. Perhaps it will change in the future, but that's how it is as we speak.

What are your priorities for the second half of the year?

As a group the priority is to get a single identity and re-emphasise to the market that we are a regional distribution company, a very serious player and perhaps the fastest growing IT distributor in terms of revenue. Another objective that we are focused on is consolidation in terms of product management as well as learning to work together in multiple geographies and putting in place a single marketing entity or resource team.

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