A nimble, North American strategy has helped propel SoftChoice Corp. to the top of this year’s CDN Top 100 Solution Provider listings.
Some 200 VARs gathered at Toronto’s Liberty Grand ballroom last month to applaud the publicly-traded Toronto-based software firm, which branched into hardware sales two years ago, has been among the biggest Canadian solution providers by revenue for several years.
But in 2004 it declared revenues of $784 million, a 24 per cent leap over the year before, making it the national champ for the first time.
Ingram Micro’s Mark Snider presented the award to SoftChoice president Dave MacDonald.
“It was a great year,” said MacDonald in an interview, who credits the growth in part to a 61 per cent jump in hardware sales, which totaled $142 million. Some 35 per cent of SoftChoice customers buy everything from servers to cables from several name-brand manufacturers.
He also credited the purchase last year of Brossard, Que.-based 3-Soft Software Group, and SoftChoice’s expanding asset management services business with helping push revenues.
Overall 2005 was a pretty good year for the industry, with revenues totaling $5.58 billion, an increase of five per cent over 2004.
Still, total revenues for the top 10 companies declined from the year before, which echoed a trend in 2004. Significantly, revenues of those ranked 11 through 20 averaged an increase of nearly 29 per cent compared to the year before.
Rounding out the top 10 on the new list were, in order, NexInnovation, Xwave Solutions, Compugen Inc., Software Spectrum, Insight Canada, Hypertec Group, Soroc Technology Inc., MicroAge and Bell Business Solutions.
SoftChoice’s roots are corporate software sales, so there’s no surprise that it’s Microsoft’s fastest-growing large account reseller in North America as well as the biggest in Canada.
It has parlayed that into becoming a North American player, carving out a niche in serving business markets, and partnering with systems integrators for installations.
It now has 600 employees in 29 branches in the U.S. and five in Canada.
Sixty per cent of its business now comes from south of the border, a figure MacDonald believes will rise this year to 65 per cent. So far the jump in the Canadian dollar hasn’t affected sales.
It’s made MacDonald a busy man. When interviewed him for this article he was in Ottawa quickly downing a chicken salad sandwich before going into a meeting of the Information Technology Association of Canada, of which he’s vice-chair.
After an Easter break skiing with his family in Banff, he was off to visit one of the company’s call centres in Seattle, then chat with Microsoft executives in nearby Redmond, Wash.
While he was pleased with his company’s placement on the Top 100 list, he was equally delighted that it was just listed as one of the top places to work in Canada by a business magazine.
That’s because increasing employee retention by spending more on training is one of his priorities for this year. Getting word out that SoftChoice is a good place to work will help that goal.
“We’re going to continue to grow our hardware business (in 2006), which we think will grow to a very significant rate,” MacDonald said. “We believe we can take more share in the U.S. in the software licensing business, and then provide those customers with hardware products.”