So, to kick off this month’s theme we sat down with Shaun Lynn, CEO of Inventory as a Service (IaaS) provider Agilitas, to find out how the company got involved in more service-led business, how it’s working with resellers, and why it’s mantra is ‘a box is a box’.
Tell us how the company began
The company started just over 25 years ago. We started life as CPI – Computer Parts International, and we essentially sold parts and were specialists in IBM midrange and mainframe products.
We then built on the technical capability of our people and would buy whole systems and de-manufacture them – tearing them down into components parts. You can create more value that way.
We essentially had a niche business that grew from an entrepreneurial start up and it built out in terms of adding extra product sets and manufacturers.
In the late 90s we started getting involved in more service-led business. What that meant was that instead of being a reactive business that waited until someone needed a part and hoped they came to us, we started providing inventory as a service.
We then captured the interest of Acal – they were a market leader in manufacturing, reselling and distribution. In the early 2000s they realised there was a lot of money in IT and the supply chain and they wanted to build out from electronics and have three divisions – electronics, high-end medical and IT.
They eventually decided that they didn’t want to do reselling and distribution due to huge consolidation in the market and ended up selling off the IT section, which led to a management buyout and a re-brand to Agilitas.
What do you offer that makes you stand out from what others do?
Essentially we provide five main offerings to our customers. We have the inventory as a service (IaaS), where you can get us to support on a per-device or per-system basis and you can chose whatever service level and risk profile you want.
We also have other services such as training – we train company engineers how to keep current on products and on an enablement perspective. As well as this we perform training for the likes of Oracle. We also provide repair services, parts and technical support.
This year is the 25th anniversary of the business. What changes have you seen in the industry over this time and how have you had to adapt to these changes?
There have been huge changes both in our business and in the market. Some of that’s been the business having to follow the market and some of that’s been the business getting ahead of the market.
25 years ago you could exist and have quite a niche business purely focused on IBM, data centres and the mid-range market. There wasn’t the same knowledge of the parts and systems and there were far fewer players in the market.
Now more people have entered the market with more third party maintainers taking business away from the manufacturer. That meant you’ve got to offer something different. You’ve got to move out and support more vendor products.
Now we support pretty much everything that you will see in a data centre. We’re totally vendor agnostic so something of a mantra for us is ‘a box is a box’.
We had to grow out rapidly. We now support IBM, HP, Fujitsu, Dell, Oracle, EMC, NetApp, Cisco and many more. It’s very much a sweet shop of server storage, networking and data centre products.
The market now demands more services. You have to continue to add more value. So having a part is great. Having it in the right place is even better. And having it at the right price is brilliant. But it’s still only a transactional relationship – you’ve got to offer more and keep creating value.
What types of businesses do you work with?
Our customers were traditionally the OEMs. I see the market as a pyramid with those guys at the top. So we started to move down the pyramid into the SMB space.
So you’re looking to grow your number of SMB partners?
We’re always looking to grow. About 66 per cent of our business is in the UK and about 20 per cent is in France, but we actually trade in 26 countries.
We’re quite unique in that we’ve got this network across Europe and we can move inventory from up to 7pm tonight to be ready to be collected by 9:30 tomorrow morning. A lot of the other inventory companies are playing catch up with that side of things.
Do think any reseller can offer services or do you think a partnership is a better option?
Resellers are all trying to gain a competitive advantage over one another and some of that is about bolting on more services. The reason for that is for customer retention, but more importantly, it’s to do with the margin. Essentially, it gives you a greater potential of retaining that relationship.
I think it’s part of the changing market that resellers will attach more services, which will be far more of an opportunity for the likes of ourselves to be an enabler to make that happen for them.
How do you see the IT services sector evolving in the future?
There is a lot more product volume but at a lower price per unit. So resellers need to do more, and that’s where the increase in services comes in. I think we will see a change in the market in that there will be fewer players because I don’t think some of the third party maintainers will be there. So I think the supply chain will shorten.
What’s in store for the company over the next year or so?
We’ve grown our workforce by 40 per cent in the last 18 months and we’re very much investment focused so we’ve added lots of technical skill and customer facing roles. We’ll continue to do that and probably look at some more niche products and services.
Networking has been a big thing for us in the past 18 months in that we’ve always been a server and storage business, but customers have been asking if we can do the networking too. We’ll continue to grow the European business also.
We’re growing at very good percentages and we’re reinvesting, so for us it is all about never standing still.