22 MINICOMP LTD:Driving Channels To Success

In an attempt to have the best of both the worlds, Minicomp Ltd has decided to adopt a dual-pronged distribution strategy. This marks the incorporation of Minicomp Infotech, which handles agency sales, in January 2000. The company also continued with its direct sales efforts.

Minicomp has been a long-standing partner of Dell, HP, Eizo and Micron. They have also entered into a joint venture with Taiwan-based I-Systems. Minicomp hopes that this tie-up would double its turnover this year. The equity participation by Minicomp in this venture is 90 percent and the machines are branded as Minicomp I-Systems. Though the agreement was signed in December 1999, shipments started six months later. Over 10,000 units have been sold till date.

Minicomp Infotech recorded a turnover of Rs 51.2 crore in 1999-2000, which constituted over 60 percent of Minicomp's total turnover of Rs 86 crore. Direct sales amounted to around 28 percent and the rest came from implementing software solutions and setting up networking projects.

During this fiscal, the company expects to cross a turnover of Rs 160 crore of which they have already achieved Rs 29 crore and Rs 27 crore in Q1 and Q2 respectively. With the imminent launch of the I-Pad, which is a Internet protocol access device, promoters of the company are hopeful of reaching their target.

South contributed the highest sales at 40 per cent. This was followed by the western region with 22 percent and the north and east made up the rest almost equally. Though Minicomp is headquartered in Mumbai, agency sales in the western region are not very encouraging due to the presence of their direct sales personnel. The company has also witnessed little growth in the metros. Non-metro cities like Baroda and Bhubaneshwar on the other hand, made a huge contribution to the revenue.

Minicomp has a specific policy for appointing partners. Every B-class city will have two dealers while one dealer will be appointed in C-class cities. This has been done to ensure that there are no geographical clashes in the channel network. Besides this, there are seven stockists throughout the country. Till the end of 1999-2000, Minicomp had a channel network of 180 partners. This number will be doubled by the end of the current financial year and the company is running schemes to retain existing ones.

In 1999-2000, the company had decided to give a Maruti 800 car to their best selling dealer. Unfortunately, no partner could drive the car home as qualification to the scheme required them to make sales of over Rs 8 crore.

This year around, Minicomp has upped the stakes and the best-performing channel partner could become a proud owner of a Honda City. Other prizes include a Maruti 800. Going by the scramble amongst their channel partners to achieve their target, the cherry on the cake should vanish pretty soon.

Minicomp had established over 10 offices in the previous fiscal and this year they plan to set up five more offices. The ones currently in the pipeline are Pune, Bhubaneshwar and Thiruvananthapuram while the other two locations have yet to be decided.

One of the biggest sales that Minicomp witnessed in 1999-2000 was a Rs 14 crore order from Indian Oil Corporation Ltd for Micron systems. Minicomp is deemed public and will soon file for an IPO. It is also working on setting up a B2B site for its channel members, which should be up and running by December 2000.