Orbrix, based in the Netherlands, was formed in 2003 as a unit of Quartess eBizz bv to handle SAP for Business One solutions. The separate business unit was necessary because Quartess already had ERP activities and wanted to retain its market independence. Orbrix, in turn, has acquired one of the consultancy arms of Exact, a local SMB software provider.
Quartess eBizz was evaluating a product from India at the time it first heard about SAP Business One. The company was actually looking for a more mainstream product to help them generate a stable cash flow. SAP could provide this, and Orbrix was impressed with the quality and stability of the product and the technology, despite its being in initial release.
“This kind of product will become a commodity in the market,” says Mario Röttjers, Orbrix CEO. The SAP brand will help position the product there.” He adds that Orbrix employees are “very proud of the product and happy that they can be part of the team that is evangelizing it.” SAP has the means and resources to support the product, he adds, noting that not many vendors can invest in such packages. The local Dutch vendors don’t have the necessary scalability; the only real alternative is Microsoft, and he did not consider them an option.
Orbrix has found the benefits of SAP Business One to be even larger than initially anticipated. The company can already see substantial revenue streams coming from various markets: “Exact has approximately 20,000 DOS installations,” notes Röttjers. “If we can convert only one percent of this market to SAP Business One, we already have a large window of opportunity.”
Even in a tough market climate, Orbrix has found it relatively easy to attract new SAP Business One clients. It initially signed 10 new clients for SAP Business One, eight of whom have gone live. Röttjers expects the firm to break even by the middle of this year. After that, it should be able to substantially lower training costs for consultants and commercial training.
Functionality from partners
Orbrix has no plans to develop additional functionality for SAP Business One but to acquire it as necessary from other partners. The company’s main goal is to focus on license sales. Currently, 60 percent of revenues derive from licenses, 30 percent from consultancy, and 10 percent from support. Consulting services are important for clients working with Orbrix, says Röttjers, but are likely to provide a smaller source of revenue in the future.
A signal success involves an implementation at a trading organization that imports goods from China for which it assumes legal ownership. Its customers can make specific order requirements – such as for a particular packaging or color. This approach leads to a complex logistical environment, yet Orbrix implemented SAP Business One for a fixed price and budget.
The project was both a challenge and an opportunity, recalls Röttjers. Since the company had no legacy IT system, Orbrix could implement SAP Business One from scratch. The client is very satisfied and delights in the reaction of its Chinese trading partners when it mentions it works with SAP.
Aiming for the top in the Netherlands
Orbrix is working to become the best-known SAP Business One provider in the Netherlands. Looking to the future, Röttjers expects there will be room for only two or three large partners in the SMB area, so it will be SAP’s responsibility to keep its partner group focused and of high quality. Orbrix has adopted an aggressive growth strategy to open smaller affiliates, first in the eastern Netherlands, then expanding to the whole country. The firm plans to sign 60 clients by the end of 2004 and around 100-150 per year afterwards.
Working with a large organization has several advantages for Orbrix, explains Röttjers. In marketing and sales, SAP is efficient in both the activities it initiates and the excellent material it makes available. SAP has provided active marketing support in the form of radio commercials which generate numerous leads. The training from Germany is also good. Overall, he says, “they always deliver on what they promise.” He notes that SAP has an “influence” on larger system integration partners like CGE&Y and BDO, whose recommendations that their clients work with SAP Business One will influence the market for Orbrix as well.
Despite a generally positive feeling about the relationship with SAP, Röttjers observes that SAP has been through a “learning curve” when it comes to working with partners in the SMB space. In the past, he ran up against account managers who did not fully understand SMB partner issues. Account managers, he suggests, should learn more about the SMB market and focus on hands-on account and sales support. He also suggests that SAP has been lagging in joint business development investments but that this is changing since SAP has stressed partner support.
The SAP account managers work hard and are always “on the job,” says Röttjers. “SAP has a lot to gain in prestige in the SMB market – maybe even more in prestige than in actual revenues – and should be aware that it takes different people and different partners to sell to this market.”