Duncan Forsyth, group managing director at Westcoast, tells Tim Wickham why he’s so positive about the IT product and service provider’s future as it enters new markets and makes more of a name for itself.
Westcoast has built its core business by distributing IT products extremely well for over 30 years. In 2017, it broke through the £2 billion annual revenue mark.
“Until now, we have tended to operate under the radar, preferring to represent vendors’ products rather than market ourselves, or brand our services as Westcoast,” said Duncan Forsyth, who joined the company in 1996.
That’s changing as Westcoast makes more of its extensive IT service capabilities. The company’s understated confidence began back in 1983 when owner Joe Hemani started importing technology products from the US west coast – hence the business name.
One of Hemani’s earliest customers was technology giant HP, which he convinced to use Westcoast as the UK distributor for its products. This broke the traditional mould of computer vendors either selling direct to customers or through a reseller.
Hemani’s hallmark running Westcoast are the dual financial disciplines of strong working capital management and a ceaseless focus on lowering its cost base. Growth has been organic, along with strategic acquisitions to gain market share using internally generated funds.
Another Hemani touch is Westcoast’s flat management structure. “Our strong centralised financial control gives us the confidence to empower managers and let them prove themselves,” said Forsyth.
Growing the business hasn’t been all plain sailing, though. An early hiccup provided a harsh lesson. After an unsuccessful link-up with a venture capital firm Hemani bought back control of his company and has kept it privately owned.
In the early 2000s, Westcoast sought to extend it business base by expanding both the markets it addressed and vendors it represented. “Throughout our development we have competed against two of the world’s largest distributors, whose turnovers are $35b and $44b, so we always have to provide strong evidence to customers and vendors of our credibility.” said Forsyth.
About 300 of the company’s 2,300 staff are based in Theale. It has warehousing and offices in Milton Keynes, Nottingham and Dublin, and is expanding in Europe. “We now have a presence in 13 European countries and are trading in 18 countries,” said Forsyth.
He regards Brexit as a double-edged sword for the company. “Some employees from eastern Europe have decided to return home. We trade in sterling, the dollar and the euro, which reduces the effects of exchange rate fluctuations. We see opportunities from businesses wanting to set up in the UK post-Brexit.”
He added: “What concerns us more than Brexit is the ability of the UK and the Thames Valley to remain a centre of excellence for technology. We are behind the rest of Europe in engaging with countries like China.”
The company is expanding the value added service side of its business, particularly for cloud computing, software and IT infrastructure. “We have a lot of tools in our toolbox that we haven’t made the most of. We call them our hidden treasures,” said Forsyth.
Three years ago, Westcoast was one of the first in the UK to offer Microsoft’s cloud service, which took it in a new business direction by providing 24/7 support to end users. It now has over 300,000 Microsoft cloud customers with around 10,000 joining every month. About 80% of these recurring revenue customers are new to Westcoast.
The company is also strongly positioned for the boom in emerging areas including AI, VR and 3D printing.
As well as recently completing a corporate identity makeover, Westcoast plans to launch its own branded services. “I’ve never been so confident about our future because we have so many different strands to the business,” said Forsyth.