Creating an IT distribution company focused on addressing the growing technology needs in the African market is not a task many organisations would undertake. IT4Africa is a company that has successfully gone where others fear to tread, making itself the leading technology distributor on the African continent as well as a growing force in the South African distribution market.
IT4Africa was established in 2001, as the volume business arm of the global CIS Group for English Africa. Over the past few years, the company has remained focused on its core strategy, 'to supply the very latest, top technology to the African markets it services'.
The company was created by merging various distributors from different countries in Africa. Each of these distributors had extensive experience in their respective markets and all of them had experience in the distribution of IT products. The resulting company, IT4Africa, now provides supply chain and distribution services for a range of quality products. It currently focuses on Fujitsu Siemens Computers, HP, Acer, Cisco, Toshiba, APC, HP calculators and Microsoft, among many other international brands.
Fadi Nasr, general manager of IT4Africa, explains that the CIS Group, decided in the 1990s to expand its services offerings on the continent (CIS's services or 'value business' focuses on systems integration in the telecoms, government, banking and oil industries) by launching a new volume distribution arm. IT4Africa is one of the resulting three companies launched to establish a Pan-African distribution network and it specifically targets English-speaking Africa.
To provide the necessary support for clients in the region, IT4Africa has established a head office in South Africa with branches in Botswana, Kenya, Angola, Namibia, Zambia and Zimbabwe, with a Mozambique office launching in 2007. Further developments in 2007 may see the company potentially opening a direct presence in Dar Es Salaam, Tanzania, Ethiopia and Uganda in the near-term with a new hub in Dubai.
IT4Africa's offices are not established in new markets with the hope of creating a profitable business there. They are launched only after the company is established in each particular country.
IT4Africa’s Johannesburg head office
"When launching in a new country, we first ensure we have done the legwork necessary to be considered for large deals," says Nasr. "Then, once our partners and customers in the new territory reach a certain level where a direct presence is warranted, we set up a local office to further entrench our position and ensure the service we provide is unbeatable.
"This is a winning formula. To date, not one of the company's 30 business units across Africa has been shut down."
"From the start, IT4Africa has been a profitable and growing concern, escalating its market share and expanding further into Africa every year. For the 2006 financial year, the company is looking at a $50 million turnover, about 25% of this coming from South Africa; with CIS Group turnover in the region of $250 million."
Strength in Africa
Success over the whole continent of Africa has eluded even the most experienced distributors in the past. The continent does not require companies to spend copious amounts of money setting up complex supply chains and multifaceted deals. Instead, it requires good service from partners who understand and can operate in local conditions, while still maintaining a globalised outlook.
One of IT4Africa's strengths is its flexibility. Even though a large multinational owns the company, its executives have the liberty to adapt to any circumstance and change in the environment in realtime; ensuring customers get exactly what they need. Moreover, Nasr says this flexibility applies not only to large enterprises or to government IT departments, but to even the smallest companies that need an experienced and reliable IT partner.
The company also benefits from an experienced team of senior managers, who between them bring over 20 years of experience in the IT industry. In addition, IT4Africa has recruited a highly focused team of support personnel in each of the markets in which it operates. "We pride ourselves on creating a good working environment for staff, allowing everyone to grow and reach their own potential within the company," Nasr adds. "The enthusiasm and commitment this engenders in the staff rubs off on our partners and customers."
IT4Africa’s Fujitsu Siemens Computers’ team
In addition, IT4- Africa also ensures its supply chain is as streamlined as possible by outsourcing its warehousing and logistics to an expert in the field. It has warehouses and related facilities operating out of Johannesburg, France, Dubai and the UK. This means stock can be delivered anywhere in Africa in the shortest possible time.
According to Nasr, "IT4Africa's strategy represents the optimum fusion of the traditional distribution model with the benefits that the Internet makes available. To this extent, many of the standard transaction processes will be Web-enabled to give all customers, irrespective of which markets they operate in, equal access to information about the products and sales processes.
"Our drive to focus on selected tier-one brands will position the company as a unique supplier of products on the continent. This position allows IT4Africa to install a presence in some of the newer markets within a very short time."
Strengthening ties with Fujitsu Siemens Computers
IT4Africa's entrance into the South African market was marked by the announcement of a partnership with what was then a new vendor for the company, Fujitsu Siemens Computers. Even though the distributor had to start out training its staff and building a customer base from scratch for this brand, it has in the past four years established itself as a leader in supplying the full range of Fujitsu Siemens Computers' equipment in South Africa.
IT4Africa's South African Fujitsu Siemens Computers' team is headed up by division manager Toni Ward and product manager Gus Pinto. Even in tough trading conditions, the team has proven its mettle and grown the business substantially over the past four years and is relishing the challenge of establishing the Fujitsu Siemens Computers' brand in Africa.
The next logical step is naturally to take the Fujitsu Siemens Computers' brand into Africa through its network of branches and business units on the continent. See page 11: Fujitsu Siemens Computers ready for Africa.
IT4Africa's staff throughout Africa are undergoing training in the Fujitsu Siemens Computers' range of equipment and they are also passing their knowledge on to the reseller channel in order to properly educate the market in terms of who and what Fujitsu Siemens Computers is, and also how this leading European vendor can assist African businesses.
As if in support of the growth expected from Africa in the coming years, Fujitsu Siemens Computers recently announced its results for the first half of fiscal year 2006, spanning the April to September timeframe. The company achieved 3,1 billion Euros in revenue, breaking through the three billion Euro mark for the first time.
Bernd Bischoff, president and CEO of Fujitsu Siemens Computers noted: "We have managed to assert our market position in an extremely tough market environment. For the first time in its history, the IT industry is experiencing that a generally good economic climate is not automatically followed by increased demand in the IT sector. We are taking the right decisions now to prepare our company for ongoing competition in the long-term. I am especially pleased that the integration of our new services business is progressing so well. We are already benefiting from increased synergies and have won new customers as a result."
For the reporting period, Fujitsu Siemens Computers recorded 18 million Euros in operating profit, but needs to absorb 14 million Euros in restructuring costs. Profit before tax was confirmed at 4 million Euros. For the second half of the fiscal year (ending 31 March, 2007) the company is expecting the IT market to show a slight increase in demand.
Although entering a heavily traded market, the insight and drive behind IT4Africa has more than proved itself and today the company sees itself positioned as the premier, trade-only specialist distributor of technology products. In fact, vendors looking at the African continent as a new, largely untapped market will not be able to find any other company that can offer a Pan-African distribution network with a proven record of accomplishment and experienced, reliable feet covering the ground from Cape to Cairo.
To provide an efficient supply chain for quality products throughout the African continent.
To be the superior supply chain business across Africa by providing the highest levels of service to our valued partners. This is achieved through partnership with our shareholders, harnessing the skills of our staff, using the latest technologies and the most efficient infrastructure en route to market.