PCS INDUSTRIES LTD – Focused Expansion

PCS Industries managed to grow by 22 percent during the year, to reach a turnover of Rs
110 crore. Amongst the initiatives that were taken this year, a definite push at channels
figures at the top. Toward this, the company augmented its in-house resources and

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JOINT MANAGING DIRECTOR: AK Patni * PRODUCTS AND SERVICES: Systems, Networking, Facilities Management
* TECHNICAL COLLABORATION:
Data General Corp.
* AGENCY
OPERATIONS: Cabletron Systems, IBM
* START-UP YEAR: 1984 *
EMPLOYEES: 609
* DEALER
OUTLETS: 163
* ADDRESS:
310/316, Raheja Chambers, Nariman Point, Mumbai 400021
* TEL: 2875525-28 * FAX: 2873984

PERFORMANCE HIGHLIGHTS

  • l Grew by 22 percent to reach Rs 110 crore.
  • l Sold over 10,400 machines in the desktops, workstation, and portables category.
  • l Pure systems revenue at 86.4 crore; services and networking brought in Rs 18.5 crore.

pcs-1.jpg (40759 bytes)

created a channel management organization headed by a country manager to provide
more focus to the entire area. The company added 300 business partners. The plan this year
is to reach a total of nearly 900 partners covering the entire country.

An internal SWOT analysis revealed that PCS Industries was amongst the very few
companies in the country who had nationwide presence and infrastructure to support
operations in virtually any part of the country. On the direct sales front, the company
decided to focus more intently on the top 200 customers and gather services and solutions
revenue from them-to yield better margins.

The company has also decided to narrow down its focus on customer segments.
Traditionally, the company has been looking at 14 segments, of which banking and finance
alone yielded 45 percent of the revenue. The other two strong segments are government and
PSUs and the education and R&D segments. The company now plans to reactivate its
energies to focus on hospitality, healthcare, private corporates, and mass transport. In
short, the company hopes to balance the segment portfolios.

In terms of products, 70 percent of PCS’s turnover came from its own brand. Realizing
the potential, the company decided to brand it as Oriion and carried out a branding
campaign in its select segments. The Oriion range would be expanded to include desktops,
servers, and multimedia machines at very low price points for the price-sensistive market.
In the high-end systems range, the Intel-Aviion range from Data General did not do as well
as expected. The reason was that the product could neither compete with RISC systems,
because it was an Intel-based machine, nor with Intel machines because it was high priced
for that range.

The company received large orders last year from banks like SBI, Canara Bank, Vijaya
Bank, CBI, and Corporation Bank. Government orders came in from Excise Department. A large
networking order came in from MICO, Nashik.

Plans for the next year include consolidation of the moves that the company took in
1997-98 and expansion into Pune, Ahmedabad, and Chandigarh to provide better coverage. The
company is looking for at least 60 percent growth in the current year and substantial
improvement in the bottomline by concentrating on large turnkey projects and
services-based businesses like ERP and networking.

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