Shebang has doubled its turnover each year for three consecutive years, and now plans to more than treble its 2009 turnover to reach £100m.
The handset and accessories distributor increased turnover from £7m, to £15m, to £30m in 2008.
New sales director Julian Burton has been at the distributor for just three months, but is already making big plans to increase revenue by injecting a ‘little bit of corporate’ into Shebang, drawing on his experience in previous roles at Vodafone and Tesco Mobile.
Burton tells Mobile that distributors can no longer compete solely on price in an increasingly cluttered market, and must be innovative to win customers.
Mobile: What are the current challenges in distribution?
Burton: How to maintain differentiation from ‘classic’ distributors is our focus – the philosophy to try to compete exclusively on price was never the way forward. The next factor for Shebang was to be the most innovative on systems; this continues to be a big unique selling point, but rivals could still catch up. Currently, Shebang is trying to become a leader in customer service.
Is your ‘virtual warehouse’ Sellfone 3G a big part of this?
Sellfone 3G is our core platform and gives us a real edge. We have two deployed versions; the first is for web retail delivery and the second is for in-store retailers. It provides an infrastructure for our retail partners to manage core connectivity, taking the cost out of doing it themselves and providing it immediately.
Above that, Sellfone 3G was built with the explicit goal of taking all the admin pain away from sales people, allowing them to devote time to the consumer, whether through auto replenishment, automatic commission reconciliation or the ‘virtual warehouse’ that grows their product range to an almost limitless extent.
Alongside this, we have a whole host of side services, from helping them deal with the proposition end to end, to deploying experts and sales coaches onto shop floors.
What pressures are on dealers now?
After macroeconomic pressures, there are currently two major difficulties for dealers. Firstly, the networks’ move towards a revenue share/ongoing payment system. Particularly for smaller dealers, there isn’t a big pot, and though the new systems will promote greater lifetime profitability for the dealer, can they afford to wait? Supermarkets and other new entrants are also eating into the available market, so dealers will need to focus even more on core strengths such as real local customer service.
What changes have you made since joining Shebang?
I’m not rushing into anything – Shebang is a young, entrepreneurial company but there is a healthy desire for it to grow up a little. I’ve come from a corporate background (Vodafone and Tesco) and I’ll be injecting a bit more of the corporate nature into Shebang without taking away from the entrepreneurial nature of it.
I’ve restructured the sales team into the traditional lines of category (prepay, accessories, contract and Sim-free) and account. This ensures
the team knows what is expected and our retail and network partners benefit from a more focused service. It’s not a new innovation, but why change
How important is having an online presence as a distributor? How have you been developing this?
Three weeks ago we went live with the website for our in-house brand of mobile phone accessories Nexxus. We will shortly be rebranding our core Shebang distribution site to reflect all the services we now offer; however, the current priority for our IT team is supplying our existing customers.
How has the market changed since 2008?
Sim-only has been a massive change. Retention dynamics for networks have altered massively – there is now a trade off for customers between getting a sexy new handset and getting a better bundle of minutes and texts. That has been around for forever in retention land, but now with Sim-only that
offer is available cross-network.
Retention is still dominated by networks but Sim-only is changing that. A customer can walk into any independent retailer and the option is available to them – if networks work more closely with indirect on this, it could be a more significant change for the indirect space.
Are there any other market issues?
Box breaking is becoming a hot issue again, as it is more organised than people think. There won’t be a quick fix anymore, a more joined up solution will be needed.
We’ve got a live market solution right now, eloquently called the ‘box-breaking prevention scheme’. It means the handset user cannot separate the Sim card from the phone without mitigating the value of the handset. We are also sitting on two further developments that we can bring online if needed, to make it more difficult for box breakers.
What deals has Shebang got lined up?
We will be looking to continue our growth this year. We’ve just got exclusivity on the Sonim Land Rover S1 rugged phone – this is in conjunction with a partnership with Land Rover. Both were a big coup for us.