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

border="0" hspace="2" vspace="2"> JOINT MANAGING DIRECTOR: AK Patni color="#FF0000">* PRODUCTS AND SERVICES: Systems, Networking, Facilities Management * TECHNICAL COLLABORATION: Data General Corp. * AGENCY OPERATIONS: Cabletron Systems, IBM * size="1"> START-UP YEAR: 1984 * EMPLOYEES: 609 * DEALER OUTLETS: 163 * ADDRESS: 310/316, Raheja Chambers, Nariman Point, Mumbai 400021 color="#FF0000">* TEL: 2875525-28 color="#FF0000">* 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. hspace="2" vspace="2">

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.