Local IT companies ponder consolidating presence on external markets

Take TotalSoft for instance. The company's vision is to become the strongest supplier of software solutions for management and eBusiness solutions, and also a preferred partner for companies in the United States and Western Europe that wish to outsource some of their processes of development of customized software applications.
At this point, TotalSoft has two offices abroad, in the United States and in Serbia. While the office in Serbia (Belgrade) is still inactive, “We intend to revitalize it and promote our products on this market, especially the system ERP – Charisma Enterprise,” Liviu Dragan, general manager of TotalSoft, tells Business Review.
“We have opened the office in Serbia with a team from Romania but we realized that in order to be successful we need a local team who know the market, its specific requirements and the economic climate very well and are able to identify real sale opportunities,” says Dragan, adding that this strategy will be put into practice both in Serbia “but also in the other two offices that we intend to open, in Bulgaria and Hungary.” The company has not made public the number of employees it intends to hire to support this expansion.
TotalSoft representatives forecast that this year the company will post a turnover of EUR 16.5 million. “At this point we are on schedule, and by the end of the year we believe we will even surpass our expectations,” says Dragan.
At the moment, 20 to 25 percent of the turnover posted by TotalSoft is represented by external projects but the company wishes to increase the value of these projects in the future. “By 2013 we have proposed that the share of external projects in the turnover of the company will amount to 40 to 50 percent,” said Dragan.
However, the company's external projects span a wider area than what is geographically covered by branches, as they are being implemented in countries such as Poland, Greece, Bulgaria, Albania, Serbia, Russia, the Czech Republic, Hungary, Ukraine, Germany, Sweden, the United States, Belgium and Israel.
A study entitled “Software Systems for the Leasing Industry. An International Overview,” carried out by IT consultants and leasing specialists Eelco Wolters and Marc Peeters, places TotalSoft among the top ten international suppliers of informatics solutions on the equipment and finance lease and automotive leasing segments.
External clients of the Romanian- based company mainly come from the sphere of financial services. Among them are Raiffeisen Leasing Bulgaria, Raiffeisen Leasing Albania and Raiffeisen Leasing Ukraine, BMW Bank Greece, BMW Leasing Greece, BMW Leasing Russia, Scania Credit Bulgaria, NLB Leasing Bulgaria, Balkan Star Bulgaria and Piraeus Leasing Albania.
The company's activity expansion plans include enlarging the sphere of its product Charisma Enterprise system sales from the financial services to companies.
TotalSoft aims to promote the application series Charisma on external markets, and especially its main product, the ERP (enterprise resource planning) Charisma Enterprise.
“Our aim is also to become the main supplier of ERP solutions in Central and Eastern Europe, an objective that up to this point has translated into the implementation of the system in 10 European countries,” says Dragan.
Another objective of the company is to target companies in the construction business with a unique integrated solution Charisma & Primavera, which is “successfully sold on the Romanian market as well.”
Another local company with a significant presence on external markets is Siveco Romania, which is developing informatics projects in countries in Central and Eastern Europe, in European Union countries, within the space of the Community of Independent States, in the Near East and Middle East and in North Africa.
“These markets represent a good business environment for replicating our successful projects in domains such as eHealth, eAgriculture, eCustoms and eLearning,” Alexandru Cosbuc, deputy manager for international sales and global partners in Siveco Romania, tells Business Review. He explains that in these countries Siveco has identified “economic and cultural conditions in which we can put to good use the expertise we have obtained in unfolding large-span and complex projects,” he says.
Incomes from external markets make up approximately half of Siveco's turnover, according to Cosbuc. “Generally, we try to keep a balanced contribution in the source of our incomes between large and smaller projects, internal and international ones, and between economic domains with high growth potential. This approach is all the more healthy and prudent as generally large and complex projects take place over a longer period of time,” says Cosbuc.
There are similarities between Romania and the other geographical areas where the company runs its activities. “As a general characteristic, you have to mention the increasing demand for eLearning, eAgriculture, eHealth and eCustoms solutions, which are our area of competence. Still, every market should be approached in a specific manner,” says Cosbuc.
The company's projects outside Romania's borders are developed with global and local partners, Cosbuc says.
“We have initiated projects of eLearning, eAgriculture, eCustoms that are now in advanced stages of implementation, or are already completed,” says Cosbuc.
Since the company operates in the business-to-business domain and in the development of international projects, Siveco relies a great deal on collaboration with partners.
Last week, Siveco Romania in collaboration with Latona company completed the implementation of the IT program for the Health Insurance House in Bulgaria, this being the first company project implemented in this country. The contract amounted to EUR 3.5 million and its implementation lasted for 18 months. The contract also stipulates a 24-month maintenance period.
Other clients of Siveco Romania outside the borders are the Ministry of Education from the United Arab Emirates, National Health Insurance Fund Bulgaria, the Ministry of Education and Culture of Cyprus, the Ministry of Education and Higher Education of Lebanon, the Organism of Rural Payments in Cyprus, and the Customs Service of the Moldova Republic.
“For this year we wish to achieve a 20 percent increase in turnover and we have every reason to believe we will do so,” says Cosbuc. In 2007, Siveco posted a turnover of USD 70 million.
Another Romanian-based IT venture, the Romanian producer of IT security solutions Bitdefender, has so far opened branches in Germany, Spain, the United States and Great Britain. Company representatives predict that in 2009 Bitdefender will have a share of 50 percent of the local market of antivirus applications, while currently, Bitdefender's market share is situated around 45 percent. The market is estimated at EUR 6 million. However, only 5 percent of the company's sales come from Romania.
In the future, Bitdefender will concentrate on expanding its presence in Asia and also on consolidating its position in Croatia and Serbia.
“We are studying the possibility of opening an office in Asia, the most probable target for this operation being the Japanese market,” said Razvan Valceanu, country manager for BitDefender Romania.
In total, Bitdefender is aiming for a share of 5 percent of the international antivirus market, which is estimated to be around the global sum of USD 7.3 billion in 2010.
The company also announced it had reconsidered its decision to float on the stock exchange, a move that was announced for this year.
At the end of last year, seven investors bought share packages in the company. Bitdefender was on a mission to attract investments. A listing on the stock exchange was considered in order to support the company's expansion on external markets.
However, the listing on the stock exchange was postponed for next year due to the situation on the international economic markets.
Recently, Valceanu told the media the company was in talks with possible investors and that all financing options were open.

By Otilia Haraga