TAD S.r.l. is a Sicilian software solution developer focused on the fashion industry. It maintains headquarters in Palermo, with two offices on mainland Italy, in Rome and Turin. The company markets its own software product which it distributes to 180 Italian clients, working through a network of partners.
TAD has traditionally concentrated on the larger fashion vendors in Italy, but the firm is now changing its focus to the small and midsize business segment, which TAD’s CEO, Claudio Cuccia, feels will become a more important market in the near future. These smaller businesses prefer a solid partner who can guarantee continued investments in product and market development, he notes.
After comparing several midmarket-oriented products, TAD signed a partnership for SAP Business One in June 2003. Cuccia sees room for only a limited number of software vendors in the Italian midmarket, with smaller houses eventually disappearing. “We see in SAP a market leader, and they feel they can improve our business as well as our clients’ business,” he says. He characterizes SAP Business One as flexible yet focused and easily adaptable to the needs of the user.
At this point, the company’s strategy is to start with SAP Business One, then possibly expand into mySAP All-in-One or SAP R/3: SAP is famous in Italy, says Cuccia, and TAD has already had client requests for other SAP solutions.
Shooting for number one
First, the company aims to become the number one partner for SAP Business One in Italy. The plan is to improve its competence in specific industry solutions – starting with the fashion industry – then possibly expand to other aligned industries. This growth strategy includes both its existing customer base and new clients. With the existing clients, Cuccia sees an opportunity to migrate to SAP Business One from the present TAD solution.
“When presenting its own solution, TAD deals with its customers in a highly personal way,” explains Cuccia. After extensive discussion of the client’s needs, the company tries to come up with an innovative solution at a customer’s site. TAD then works to standardize the innovation, so that other customers can benefit as well. He feels that this same development approach will serve them well with SAP Business One. Though TAD may need to develop add-on functionality, he has identified this as a business opportunity, since they have development resources and expertise in-house, plus market credibility.
TAD reaped substantial benefits from the SAP Business One partnership early on, selling more than 10 projects during the last quarter of 2003 and an additional six in the first quarter of 2004 – figures that exceeded its expectations. Cuccia credits this success of SAP Business One in the Italian midmarket to its ease of installation and use. It also enables companies to grow while maintaining their IT system intact, he says.
Putting SAP Business One on the table
Sicily is famous for its bakeries and pastries. TAD expanded beyond the fashion industry to implement an SAP Business One solution at a Sicilian bakery which needed to improve its logistics, storage of goods, administration of suppliers, and archiving. TAD completed the SAP Business One installation within a day. This proved how easy it could be for the firm to move away from its core fashion focus.
The SAP Business One partnership is promoted through events, mailings, and telemarketing. TAD had previously supplied no budget for advertising but is now exploring joint marketing initiatives with SAP. According to Cuccia, a joint road show with SAP in Sicily would benefit the firm greatly since the business opportunity is spread across Sicily.
The SAP relationship has already improved TAD’s competitive position – more so than Cuccia expected. In the Sicilian market, many smaller software houses can deliver and support solutions cheaply, he points out, so price competition is intense. But the fame of the SAP brand name has helped the company to improve market perception of its business and skills.
He adds that TAD has received excellent support from SAP in marketing, sales, and lead generation, and that training has been crucial in building the skills and knowledge needed to drive the business. Technical support has also been effective. As for information, he says that the company is kept completely up to date and in the loop.
Summing up, Cuccia concludes that the SAP partnership is opening doors for TAD that it would not have been able to find by itself: “We now feel part of the world, just as SAP is part of the world.”