ScanSource paints a picture of a digital future

Just weeks after it revealed plans to divest its hardware operation the firm has updated UK partners on the strategy

ScanSource has been setting out a vision of the future that is not reliant on the hardware business just weeks after it emerged it would be divesting its European operation.

The focus going forward is going to be based more around digital distribution with an emphasis on unified comms, collaboration, cloud, barcodes and security. Earlier this week the  channel player held an event in London and used it as a chance to update its vision for the  European operation.

Paul Constantine,  president of ScanSource Europe, expressed sadness at the recent decision to divest the hardware business but explained that the landscape in Europe had changed and putting the for sale signs up, "had not been how we anticipated it ending".

He added that the business did not have endless resources and it made more sense to allow someone else to step in and take-up the hardware challenge:  "We never quite got the same scale as in the US and at the end of the day it’s about scale".

Constantine  added that, "partners know what we are going through" because most of them were also looking to adapt their businesses for a more software and services led future.

The decision to divest the business was also made to ensure that it did not become a distraction to the rest of the European operation and would clear the focus on where the future revenues are coming from.

Where it leaves ScanSource is in a position of looking at the portfolio with a particular emphasis on building solutions that partners can take out to market. "Our job in Europe is to knit and bring all these together," said Constantine.

The ScanSource Horizon event this week was designed to bring UK partners up to speed on what the firm can offer and start to get the message around solutions out to more in the channel.

Paul Emery, vice president of cloud solutions at ScanSource, said that the number of hosted services were expanding and it was looking to encourage partners to take, "the opportunity to leverage multiple solutions together".

He gave the example of comms resellers that might sign up to carry one or two vendors but could add more through being guided through building a wider solution to take out to users.

"A lot of our customers are asking how they create more of a recurring revenue business and this is a great way of doing it," he added.

ScanSource announced towards the end of last month that it was looking to offload $623m of business operations outside the US as it put the focus on higher margin products and digital solutions.

Speaking at the time, Mike Baur, Chairman and CEO, ScanSource, explained the rationale for the decision: “After considering our strategic options, we decided that the Planned Divestitures would offer opportunities to accelerate our profitable growth and cash flow.”

“These actions will enable us to focus our investments on our higher-growth and higher-margin businesses in the United States, Canada and Brazil, as well as our digital businesses globally. This will give investors increased insight into our long-term growth opportunities," he added.

Constantine said that for now it remained business as usual and it was still stocking inventory and shipping orders.

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