Mr. Frantzen, infra:business solutions has been an SAP business partner for SAP Business One since SYSTEMS 2004. Why have you now decided, exactly one year later, to sell the company to SoftBrands?
I’ll start with the first part of your question. Infra:business solutions was originally a subsidiary of ERP provider infor business solutions AG. I joined forces with a business partner in June 2004 to take full control of the subsidiary in a management buy-out. Right from the start, our aim was to put the foundations in place for safeguarding the long-term future of our corporate strategy through partnership with SAP. The development partnership with SAP also ensured that, in conjunction with SAP Business One, we could provide our customers with an innovative PPS add-on (PPS = production planning and control) based on standard business management software.
From the outset, one of our corporate goals was to have a presence on the global market too. The marketing this required for the PPS add-on, at least within Europe, was only possible with a strategic investor who either had a shareholding in the company or took it over. Selling to SoftBrands was therefore the logical development of our strategy to become an SAP partner and market our PPS solution worldwide supported by an international SAP business partner. I should add that throughout this process we worked in close cooperation with SAP.
Why have you sold your company to an SAP business partner from the USA? Were there no interested parties in the German-speaking world?
We initially examined completely different options, such as partnership with an SAP business partner from the German-speaking world. SAP supplied us with the relevant contacts and we had talks with other companies too. In the course of the different discussions, it soon became clear that the aims and strategies of infra:business solutions and SoftBrands dovetailed best and offered the greatest synergy potential.
SoftBrands focuses on sales of SAP Business One and has a globally oriented sales and product strategy for SAP’s standard business management solution. Both our companies are also SAP development partners developing and supplying integrated add-ons for small and midsize manufacturing companies based on SAP Business One, namely Fourth Shift Edition for SAP Business One and infra:ONE. On top of this, both SoftBrands and infra are highly successful with their own products (editorial note: Fourth Shift and infra:NET) and these have numerous existing customers in the production industry. This meant the decision was a logical one.
In your view, what were the critical factors in SoftBrands’ decision to take over infra business solutions?
SoftBrands already had a European subsidiary in the United Kingdom and, as part of its continuing expansion strategy, was looking for a suitable strong partner that was well established in the German-speaking world in particular. Germany is one of the world’s major manufacturing markets, with a large volume of small and midsize manufacturing companies. Anyone looking to become a successful software provider throughout Europe in this sector must first prove themselves on the German market. Infra:business solutions is well established on this market and has a solid reputation, which was a major factor in SoftBrands’ decision to take us over. An additional aspect to consider was that SoftBrands, as a global SAP business partner for SAP Business One, had turned to SAP for support in finding a suitable partner. SAP recommended us to them and actively supported the takeover process too. That is something we are proud of.
What opportunities do you see in the transatlantic partnership with SoftBrands?
SoftBrands is present worldwide through its sites in China, India, Africa, and the United Kingdom. This strong, internationally focused partner is essential for us to be able to implement our own ambitious internationalization strategy.
In the medium term we are planning to expand from Germany into Eastern European countries in particular. Many manufacturing companies now have subsidiaries and branch offices in Poland, the Czech Republic, Hungary or Ukraine. They require future-proof solutions in their branches, which we offer and implement. But I see major market opportunities in Southern Europe too, especially in Spain. For SoftBrands, infra will practically be a bridgehead for a European expansion strategy in the future.
With the “Fourth Shift Edition for SAP Business One”, SoftBrands has a PPS solution for small and midsize manufacturing companies. How do you intend to successfully launch the product onto the German-speaking market, especially as there are already several PPS add-ons for SAP Business One from other SAP business partners?
All I can say is that competition vitalizes business. In Germany alone we have some 250 competitors in the PPS sector, and that’s not including SAP-based solutions. However, that doesn’t make us afraid to launch our own PPS solution and establish ourselves on the market. On the contrary – we see excellent opportunities for success in this country. One reason for this is that SoftBrands enjoys worldwide support from SAP. This is hugely important in winning major orders since an international company is unlikely to conclude a contract with a partner whose limited human resources, for example, do not allow it to operate beyond Germany’s borders.
A large number of midsize manufacturing companies based in Germany are already active on the world stage too. These would prefer to choose a partner that is also established globally with appropriate support structures. Imagine the following situation. A global manufacturing company intends to install SAP Business One with an integrated PPS solution at its production sites abroad and link this up to the SAP system at head office. This only works if the implementation partner also operates at an international level. Joining forces with SoftBrands gives us these possibilities.
So you’re confident of success?
Yes, of course. What’s more, there’s another factor to add to those mentioned earlier. SoftBrands has been established in China since 1989 and currently has over 130 employees and 400 customers there. This means we can bring solutions to market faster and, above all, more cost-effectively. And this gives us the edge on a fiercely competitive market, enabling us to stand out from our competitors. At the same time, we can meet the needs and expectations of existing and prospective customers. These are looking for future-proof, highly integrated PPS software combined with SAP Business One that can be implemented fast and deployed globally, and is also cost-effective.