After 9 years of distributing printer consumables, A.C.T. has extended its offering, giving customers a complete solution that includes printer hardware, consumables, finance and support. This will position A.C.T. as the only value added printing focused distributor in the Southern African I.T. channel.

“ACT always focused on the printer consumables supply chain but recent economic trends, in both the global and Southern African market, show that a more holistic approach to how people want to buy consumables is needed,” says Pickford.

“This move towards offering customised printing solutions will empower our resellers that specialise in the ‘printer’ space to offer a professional, cost efficient and relevant print solution to the end user customers,” says Gary Pickford, managing director of A.C.T.

A.C.T. has started with a focus on only three printer brands: Samsung, OKI and Canon. “We will also not focus on the entire range for these brands – we have worked closely with the Vendors to look at the most appropriate offering initially and the solutions and bundles will evolve as we see the demand grow. We are also specifically focussing on the business market, targeting the SMB segment in South Africa.

“We have received a positive response to the move as our resellers recognise that by adding printers to the mix we’re giving them the ability to become more involved with their customers’ printing needs as opposed to simply supplying them with consumables in a timeous and cost-effective manner,” Pickford adds.

The MB Technologies Group, Africa’s leading value-add distribution group, which includes, A.C.T, Channel Capital and Channel Risk Management, Platinum Micro, Printacom and Tarsus Technologies among its operating companies, has announced a change of distribution strategy for the Samsung printer brand within the group.

This change sees the repositioning and transfer of the Samsung Printer Distribution agreement from Tarsus to A.C.T. This is in line with the group’s strategy to position A.C.T. as a value added printer distributor offering customised printing solutions to its resellers. A.C.T. has been a Samsung consumables distributor for the past two years. This change will enable the MB Technologies Group to maximise the full potential of this leading brand in the printer industry.

“A.C.T. will assist our partners to market Samsung’s excellent range of business printers by focusing on the competitive total cost of ownership offering” says Gary Pickford, Managing Director at A.C.T.

Samsung currently holds the number one position for Laser Printer in South Africa with annual sales in excess of R350 Million. With a broad, expanding product range and a focused market segmentation strategy, A.C.T. provides Samsung with a great opportunity to grow its business range of printers and multifunction printers into the corporate, government and enterprise market.

“We are delighted to welcome A.C.T. on board as our newest Printer Distributor” says Dennis Brett, Samsung IT/OA Division Head. “A.C.T. is a leading national Printer Consumables Distributor with a reputation for sales and service excellence. With the addition of the Samsung printer brand to their portfolio, they can now offer a complete printing product offering.”

A.C.T. officially commenced distributing Samsung Printers from 1 March 2011.

Anton Herbst, managing director of Advanced Channel Technologies (A.C.T.) since March 2001, will be leaving A.C.T. with effect from 1 February 2011.

As a consequence of his resignation Anton will relinquish his position as a director on the MB Technologies main board effective1 February 2011.

Anton has made an outstanding contribution to the MB Technologies Group over the last decade and will be leaving to pursue personal interests.

In December 2000 Anton and his fellow directors presented a compelling business plan to the MB Technologies board to expand its offerings into the IT consumables market. From humble beginnings, but with an ambitious business plan, significant strides have been made in developing a formidable IT consumables business.

In his gentle and authentic way, Anton together with MB Technologies and his fellow directors and management team, have developed A.C.T. into a comprehensive business with deep management and significant relationships with vendors, customers, banking partners and staff. He has shaken the consumables market in his gentle manner and has created a winning team with a significant focus on its service offering.

“When we started A.C.T. we felt the need to build a business that would last forever. In striving to achieve that we have created a business that is sustainable, whilst being agile. We have also developed mutual respect between A.C.T. and its vendors and suppliers, and most importantly, staff that can see and chase after our big hairy audacious goal. My time with A.C.T. has been beyond my expectations and I will sorely miss the camaraderie of the team, the joy of creating strategies and then the involvement of all in their execution. I am looking forward to the change of pace though and am going to spend a good deal of time focusing on philanthropy, which will come as no surprise to those that know me,” says Anton Herbst.

Gary Pickford, who has held the position of sales director for the last decade and who has an intimate knowledge of the IT consumables market, has been appointed as managing director of A.C.T. with effect from 15 January 2011.

“Gary has made a significant contribution to A.C.T. over many years and has been well groomed under the leadership of Anton to lead A.C.T. into the future and grow the business further. In conjunction with Anton they will ensure a smooth transition,” says Glenn Fullerton, CEO of MB Technologies.

He adds: “Shirlinia Jacobs, who currently holds the position of enterprise sales executive and who has been with A.C.T. since inception, will assume the role of sales director effective 15 January 2011. Utilising  significant experience in the sales arena that she gained under both Anton and Gary’s mentorship, I am confident Shirlinia is well qualified to spearhead A.C.T.’s sales team”.  Helene Liebenberg, who has vast experience in managing A.C.T.’s logistics over the last ten years, will continue in her current role. No further appointments will be made to the A.C.T. board.

“The MB Technologies Board would like to thank Anton for his invaluable contribution to both A.C.T. and the MB Technologies Group and wish him everything of the best with his new endeavours,” concludes Fullerton.

Anton will continue to be associated with the group and will offer strategic consulting services to the MB Technologies Group.

With the Rand about 20% stronger than what it’s been in previous months and the price of stock the cheapest it’s been in a long time, many stationers and resellers are predicting a natural upswing in the market as customers rush out to benefit from better pricing on hardware, consumables and other business essentials.

Unfortunately, the rising running costs members of the channel and their partners are experiencing throughout departments will scupper all hopes of that upswing transpiring.

Realistically, the market can expect the cost of electricity supply to rise more than 25% on top of last year’s 46% increase, the petrol price to climb another 10% to 20% by April and an increase in the consumer price index of between 6.5% and 7% (depending on how you calculate it) take any chance of increased sales volumes out of the game.

There’s also no way we as an industry can even begin looking at adjusting our margins downwards to create a more buyer-centric market – in fact, we should be doing the opposite.

The 20% reduction in the cost of stock has meant, should margins remain static, companies will be making 20% less profits than they did in previous years.

The only solutions are therefore for us as an industry to increase the volume of stock sold to customers by in excess of 20% (since 20% will only place us on a par with previous years), drop our service levels so our businesses reduce overheads and in doing so cope with the same margins as in previous years, or raise our margins so that good profitability and health returns to our businesses.

As we’ve already discussed, the first option isn’t plausible in current market conditions.

When it comes to service levels, I believe a company should never take a route that leads it down the path of lowering its service levels to customers.

The only option that remains is to raise our margins – and this is personally what I think we have to do in order to survive.

Besides this being the only way for companies to continue servicing their customers, it’s a move that separates the proverbial men from the boys, since the only companies capable of increasing their margins are those that are confident in the level of value they add to their customers’ lives. And quite honestly, those with customers that will be prepared to pay more by virtue of the service they are afforded.

If a company can’t raise its margins so as to remain healthy and capable of adding value to its customers’ lives, how much value is it truly adding and how good a relationship does it in fact have with its customers?

It’s a sobering thought but one that’s worth considering.

Rest assured, if you’ve remained true to the tenets of good business practice, you and your business shouldn’t have too much issue negotiating this adjustment. IF you haven’t however, it’s probably time you asked whether or not you truly want to be part of this business.

By: Anton Herbst

Despite the positive news drifting in fromUS and European shores about the end of the recession and returning confidence in the market, on local shores things haven’t looked as uncertain as this in quite some time.

On one hand, 2010 has seemed far more positive than the past two years, with good sales figures returning to the channel and daily sales volumes returning to the same, if not a better, level as what they were 12 months ago.

On the other hand, things haven’t looked worse for some companies.

And that’s the confusing part – all of that positivity should mean that market closures, bankruptcies and the need for bailouts should be a thing of the past.

Instead, the first couple of months of 2010 have seen a number of VARs closing their doors and others hanging by a thread, doing everything in their power to prevent their own closure.

It’s clear that the market is in limbo and the trends, patterns and history we have so often relied on in previous years for insight, don’t seem to apply.

While this uncertainty reigns supreme, it’s good to see more people realizing that we’re at the deep end of the pond and things aren’t going to get worse from here on in.

Over the coming months, I do believe we can expect things to become more upbeat in the market and for market factors to begin steadily improving.

As I’m sure everyone is aware however, it will take some time to deal with the issues the market has faced over the past couple of years.

Like the cocktail of factors we find afloat in the market today, the coming months will undoubtedly continue to be a mixed bag.

While those who were previously being crushed by their high-debt levels are getting some relief in that the costs of servicing that debt are on the decline, there’s not an abundance of disposable income to amortize those debts quickly.

The 2010 soccer world cup which South Africa will be hosting in a couple of weeks’ time is also drawing nearer and unlike many market pundits who believe positivity will flow from every aspect of this event, I’m a little more conservative in my views of what the world cup will bring to local shores.

I can’t dispute for one second what the event will do for the level of patriotism in our country. In think however the timing is unfortunate, since it will end up being a disruption in the progress the market has made this far in its recovery.

So what can we do about it? My personal belief is that we should do nothing more about the World Cup, but enjoy it. Hopefully what we can do as a country however is remember what we were busy with before the festivities hit and get back to it as soon as possible.

After all, soundly managing our businesses and focusing on what’s important is what’s gotten us thus far. And it’s what will get us through to the end of the year smiling.

By: Anton Herbst, managing director of A.C.T

I’ve discussed strategy in this column a number of times before and in all likelihood, this won’t be the last time it comes up again.

That’s because a sound strategy is imperative to all companies’ success and often, companies that are in trouble as a result of any number of factors can turn to their strategy for answers on how to get through that difficulty.

While most business people understand the value of having a sound business strategy, few realise that unless their strategy is tightly married to the operational and tactical management of their company, it’s unlikely to get them anywhere.

Don’t get me wrong. Many companies are excellent at managing their business, and have neat, clean and efficient operations.

But, unless their strategy is present in the way they manage their operations, their company could potentially be headed in a direction that’s completely opposite to what the business heads want.

The strategy is after all where the understanding of who the customer is, what they need and how best the company can best service those needs resides.

The company’s strategy is also the place that the company’s posture towards opportunities and threats in the market, economy, legislative environment and business climate at large is defined.

If a company doesn’t marry its operational management to its strategy it’s likely to plod along year after year, missing out on opportunities or being broadsided by changing market forces.

Ironically, these are the companies that refer back to their strategies questioning why these factors affected them so badly, only to find that their strategy catered for these eventualities perfectly – the company just didn’t follow the strategy.

Marrying these two domains together is the only way to truly succeed, but it’s also far easier said than done.

It often means a complete re-engineering of a company’s measurement methodologies so that matters at a strategic level is translated into key performance indicators for staff.

This means, for example, where a stock-picker was previously measured on how quickly or accurately they picked an order, they will now be measured on how effective they are at building customer loyalty.

But can you imagine the reaction if you told your stock picking team that they will now be measured on customer retention?

That’s the reason the team’s key performance indicators need to be set up to drive the kind of outcome the business strategically required.

So, while customer retention is one of the strategic objectives of the business, the business will need to ask itself – from a stock picking perspective – whether it’s more likely to retain customers if stock is picked quickly or more accurately. And possibly entertain the idea that the answer lies in a combination of the two.

Figuring out what the tolerances or perfect combinations are, remains the challenge.

Knowing the answer to this however allows the company to operationally manage its stock-pickers to drive customer retention.

And that’s the reason the link is so important.

By: Anton Herbst, managing director of A.C.T.

Body copy: While the triple bottom line is proving to be a great tool for companies and individuals aiming to be more responsible to the environment and their communities, it even has something to offer companies and individuals that are stuck in an archaic mindset that correlates success to financial performance.

That’s because, when one delves into the environmental and social impacts of your business, you find a number of steps you can take to not only reduce your environmental and social impact, but catalyse financial performance.

Logistics is just one example of this in practice.

Using a purely financial yardstick to plan your company’s logistics infrastructure, you would keep all of your stock in a centralised warehouse and send delivery trucks to each region, planning routes for the lowest running costs, while still maintaining a reasonable service level.

The triple bottom line approach to the same problem brings the community and environment into the mix – and thus seeks out innovative ways of maintaining acceptable service levels and good cost efficiency, while most importantly, having a reduced or neutral effect on the things around us.

And it can be a more cost effective way of thinking than purely focusing on the finances.

The fact that in the past, companies only looked at the financial aspects of their business and weren’t forced to be kinder to the environment and community around them, meant they never had to innovate. And innovation is where the real benefits are delivered.

So by contrast to the above example, since the triple bottom line would forbid waste, your company would in all likelihood analyze how much of its delivery fleet was running at half stock capacity and how much of it was full-up with stock on each run – and aim to increase the number of trucks running at full capacity, since this would reduce your business’s impact on the environment.

Inadvertently though, this would up the business’s efficiency levels and mean that on a per stock item transported basis, the logistics cost would be reduced – something that leaves more room for margin, or the ability to be more price competitive.

Your business would in all likelihood also look at the fact that there’s duplication of effort taking place in the channel.

Vendors, distributors and resellers all have logistics environments, and often these overlap – duplicating a ton of effort, cost and most importantly (in triple bottom line thinking) impact on the environment and inadvertently, the community.

By thinking innovatively about this, a distribution company can offer door-to-door deliveries to its resellers customers, thus bringing a new value added service on board, whereas a reseller can urge its distributor to create a door-to-door delivery service to their customers, since this will allow them to reduce their costs of doing business.

It’s important that all businesses realise the triple bottom line isn’t just about compliance – it’s about doing the right thing financially, environmentally and in the context of one’s community, and that it can be an opportunity for great financial performance.

All of these areas are mutually supportive and fuel each others’ effectiveness – and if your business’s financial reporting can benefit from being more environmentally aware and being a more responsible citizen, there’s little more reason one needs to embrace and focus on excelling at triple bottom line reporting.

As a small to medium sized business, your technology budget is precious. You can’t afford to squander money on solutions that don’t deliver real business benefit – and in the middle of protracted downturn, you’re probably more careful than ever about how you spend your money.

Yet there is a wealth of solutions that could enhance your business. So how does one go about choosing them? By remembering that technology is only truly useful to your business if it allows you to increase your revenues or decrease your costs. The worth of any technology to your business should be benchmarked against those goals.

No longer should you be seduced into buying a solution just because it’s new or to keep up with the Joneses – any solution you acquire must be measured against a clear business objective. Smaller businesses should probably take care not to buy into technologies too early in the hype cycle, but wait for them to offer tangible benefit. At the same time, you shouldn’t be left behind by technologies that could make a difference for your business. Keeping that in mind, what are the trends to watch for in 2010?

One element of your business that you should certainly be looking at is your online presence. According to the latest statistics from respected research firm World Wide Worx, more than 10% of South Africans are now online (some 5 million) and the number of connected people can be expected to double over the next five years.

Falling data costs (a gigabyte of ADSL data costs far less than it did just a year ago) means that your customers will do more online in the year to come and that you can do more online as well.

You don’t necessarily need to be setting up a major electronic commerce portal – that depends on the business you’re in – but you should be looking at what people are saying about your business using social networking tools like Twitter and Facebook and on customer service sites like HelloPeter. It’s an easy way to keep tabs on what your customers are saying and to respond to them, and the only cost is a little time.

In addition, you should also try to set up a web site if you don’t already have one and ensure that it’s up to date if you do. Thanks to innovations like Google AdWords, the online world also offers you some economical options for advertising.

Another important technology for the year ahead is mobile communications. Smartphones are finally at a point where they are easy to use and offer decent battery life; what’s more, data costs have fallen to a point where they are affordable. There is no reason for your managers and salespeople not to have email and calendar access wherever they go – this is a big potential money-saver since your employees can all use your time more efficiently.

They don’t need to come to the office to check email between appointments, for example. Receiving an email in a timely manner while you’re away from the office could sometimes spell the difference between closing a deal or not. It’s the sort of technology that is ideal for an SME – cheap and practical.

The world of technology is constantly changing and evolving, but the basic business principles remain the same. Choose technologies that are simple, affordable and have provable business benefits and you’ll reap a real return on investment from them without breaking the bank.

By Anton Herbst, managing director of A.C.T.

With last month’s installment of this column explaining what it takes to build an effective customer value proposition, we’re moving onto building a successful profit model and the steps towards thoroughly understanding the interplay between revenues, costs, profit margin and resource velocity.

Tackling and understanding each of these areas is relatively simple – figuring out how they impact different aspects of your business is far more difficult though.

To recap, revenue is quite simply your company’s income, i.e. the volume of stock you are selling multiplied by the price you’re selling that stock at.

Cost is the sum of all expenses your company incurs in order to sell its stock to customers.

Profit is the differential between these two – and profit margin is the percentage differential between revenues and costs.

Resource velocity – the most confusing term of the four – is how  fast we need to turn over inventory, fixed assets, debtors and other assets – and overall, how well we need to utilise resources – to support our expected volume and achieve our anticipated profits

Sounds simple? Well, it’s a little more complex considering the economic downturn or recession we find ourselves in.

The Rand’s strengthening has been a challenge, since it’s meant that the price we are able to command for our products has slipped. At the same time, the natural slowdown in the market means demand for our products is tailing off.

Consequently, costs are coming under enormous pressure.

The only way to make healthy profits in this economy is to either increase margins or increase our resource velocity.

Increasing margins is counterintuitive in market conditions such as these – the tendency is towards selling higher volumes and this often calls for margins to be cut.

So, with margins under pressure, companies need to increase the velocity of resources. In a nutshell, companies’ cash to cash cycle has to speed up.

Building a sound profit model therefore revolves directly around finding the sweet spot between the profit margin your business is achieving and its ability to speed up its cash to cash cycle.

It is important to focus on both of these areas, since a company charging 10% profit margin on its stock, with a resource velocity that sees it turning cash into stock and back into cash again six times a year, makes the same return as a company with half the profit margin (5%), but the ability to turn cash into stock and back into cash again 12 times a year.

Personally, with the market as tight as what it is, I believe the key lies in maintaining margins at a reasonable limit and exercising excellent financial discipline.

There’s quite frankly far less room to move today when it comes to margins, after all, you need to remain competitive. There is however a ton more a company can do when it comes to managing its cash flow (cash to cash cycle) more effectively.

It’s no easy task, but after all we’re in a downturn – hard work is called for. I can personally testify to the fact that it can be achieved.

It can be done, but it takes focus, discipline and bravery. Good Luck.

By Anton Herbst, managing director of A.C.T.

Four months ago we embarked on a journey toward understanding the power of sound business models and how they can get you through the downturn.

And looking back on what’s taken place with the business and economic climates in South Africa over the past eight or so weeks, it’s clear this discussion point couldn’t have been timed better.

With the way things look in the market I believe the timing is right for us to take our business models up a level and not just be concerned with our own businesses. After all, the business models of our suppliers, peers and customers are vital influencers and contributors to our own success levels.

For this to take place, the business models of all concerned must align. It’s a case of asking oneself ‘what I do that makes your business better’ and vice versa.

It’s not just about what value your suppliers and partners’ hold for you, but how they improve the value proposition to the customer by working through you.

It’s an interesting way to begin thinking, because no matter how integrated we make our own businesses, in the greater scheme of things they are nothing more than silos connected together via a supply chain.

And since we’re all aware of how businesses cannot function effectively if they operate with various silos within their own business model, it’s not difficult to imagine what the potential of the end-to-end channel would be, if each player became more integrated with the next.

Since businesses are generally reticent to share their inner workings with peers and partners (everyone, after all claims to have a trade secret or a unique value proposition), the traditional communications models need tweaking.

We’re realizing that the styles of communication employed in the past aren’t speedy enough to cope with the complexity of a supply chain with merged business models.

Social media is becoming the enabler to the communications that take place across the supply chain, since the volume of information players in the supply chain need to communicate and the speed at which that needs to take place calls for a medium that’s instantaneous and capable of encouraging collaboration by its very nature.

If we get this right, we’ll find we are able to offer far more value to our customers than ever before, and that we are able to do so at a fraction of the cost.

But getting there is going to take trust – taking the first step towards trusting all of the members of the supply chain and sharing information freely is a bold one.

Despite this obstacle, I believe a more collaborative supply chain environment can work – and furthermore that it must work if we are to survive the rest of this economic crisis and whatever the future holds.

We must however clearly define the rules of engagement and ensure everyone involved is in it for the long haul.

This kind of thinking entails breaking new ground – companies can either evolve and become a part of it, or fall behind and become extinct, just like the Dinosaurs.