By Tom S. Noda
Computerworld Philippines
February 1, 2008

For Juan Chua, president of the Philippines’ oldest IT distributor company Wordtext Systems, Inc. (WSI), the term “partnership” has been thrown around a lot in the enterprise world lately, but only a few companies have really lived up to its true sense and meaning.

Chua attests that in reality, very few companies really practice and deliver on true partnerships. “Usually, most partnerships are based on expediency only. In our case, we believe in growing and developing with our partners.”

Living up to its vision of becoming the best distributor of IT products in the country, Chua says WSI values its partners and customers—who are mostly IT resellers and computer firms—by developing and working closely with the proper channels through effective marketing and proficient support.

“A lot of our partners—the core customers of WSI—have been our customers ever since we started, and we’ve grown some of our resellers,” Chua says. “We are very happy and it’s really fulfilling to see such growth from our partners.”

A clear example of WSI’s commitment to the value of partnership among its suppliers, resellers and end-users is its long-lasting relationship with Star Micronics, Inc., the first printer product WSI exclusively carried when it started in 1982. WSI celebrated its 25th year anniversary on Sept. 28, 2007.

Another factor which WSI considers to have contributed to its continued success is its distribution model. Product sales have always been coursed through its channels, as WSI believes it should not compete with its customer resellers but rather it should work together for everybody’s success.

Growing with WSI
Chua claims WSI’s slogan: “we help your business grow,” says it all. It has served as WSI’s marketing and product strategy from the very beginning, which carried the company to its present growth status.

“Our role is to really help our resellers grow their business. We provide them the best-of-breed product lines in the market, which they can put in as part of their product portfolio or as part of their solutions; so they could sell more and deeper into their customer base. That’s the guiding principle that we have,” Chua says.

He explains WSI seeks out the best products there are and helps its resellers in getting acquainted with them. “We train our resellers with those products so they in turn could integrate it into their product lines, and with that we help them grow their business.”

Aside from constant technical update sessions for its resellers, Chua says WSI also matches the type of products with each reseller. For example, the company offers retail type of products for those focused on retail; solution-centric products for system integrators; and IT security products for security firms.

Company Evolution
Chua recalls WSI began in 1982 as a simple IT company that serves customers of the Star Micronics dot matrix printer. Founded by its chairman William Chua, who ran the company with three family members, WSI has successfully grown through the years and now has 450 employees.

From word processing services, William Chua decided to go into distribution of printers, starting with Star Micronics products and later on added Hewlett Packard (HP) and some other products.

Sixteen years later in 1998, Juan Chua who was the president of Nexus Technologies Inc., bought into WSI, wherein the two companies became partners and the rest, as they say, was history.

“I took over management and added a lot more product lines. We branched out into software computers and a lot of other IT related products,” Chua says.

During WSI’s 25th anniversary celebration last year, William Chua declares: “WSI has come a long way now; from a small family corporation selling only printers, it has become a highly professional and highly skilled industry leader that can rightfully claim its preeminent place in the world of IT business.”

He says the company has outlived many leading dot.com companies, such as Radio Shack, Digital Equipment Corp. (DEC), Burroughs, Osborne, VisiCalc, Dbase II, and WordStar. William Chua notes WSI’s success is reflective of the success of its stakeholders and partners, to whom they render true partnership.

Chua adds WSI has grown tremendously, having several subsidiaries and other branches all over the Philippines. They also take pride in contributing well to the life of the local IT industry and to its development in the country.

Chua describes WSI’s greatest achievement is the gainful employment of its 450 employees and the skills and talent it contributed to many of its alumni. “Many workers who graduated from WSI have gone out and took much bigger roles in the IT industry, and we are very happy for them.”

With WSI’s 450 people, Chua says 40% of them are doing technical services, 30% for sales and marketing, while the remaining 30% are assigned for backroom operations, logistics, and product delivery.

Addressing Challenges
The WSI president shares staying alive in the IT industry for 25 years is not that easy and the most amazing thing he considers is that, after all these years, WSI remains to be relevant and very vibrant in the local IT arena.

“Most companies would be gray and old and irrelevant in 25 years but we’re not like that. We are still growing,” he says.

Chua says the biggest challenge for IT distribution in the Philippines is probably the same worldwide. He identifies two greatest challenges—hyper-competitiveness of the market, and dealing with obsolescence, or when IT products become obsolete.

In dealing with hyper-competitiveness in the IT industry market, Chua says margin erosion has been a constant concern.

WSI, he says, engages with the problem by figuring out how to continue growing with razor-thin margins.

However, Chua reveals the time rate against obsolescence is fast that for every three to six months, there could be a total overhaul of product lines especially on the hardware side.

“For every three to six months, HP will come out with product launches. And this could render the products you have in your inventory obsolete,” he says.

Chua says as a distributor, WSI is required to stock up and provide inventory for its resellers. “The challenge is to provide enough inventories to avoid stock shortages or stock outs, but at the same time not stocking too much inventory, so that when new products come, the company won’t be stocked with a lot of outdated and out-modeled inventory.”

Service Innovations
In its 25 years of doing business in the Philippines, WSI has introduced a number of service innovations in the IT industry market, which include the 1-800 easy dial-up service, online inquiry, mobile inventory van, and now the popular product seminars in movie houses.

Chua claims WSI was the first IT distributor in the Philippines to offer the 1-800 easy dial-up service during the ’90s, meant for its provincial resellers to call toll-free.

In early 2000, WSI offered the online inquiry for its customer resellers—a type of e-commerce but not open to the public—now commonly known as business-to-business (B2B) online.

With its online inquiry service, WSI’s resellers could order and inquire about availability and prices of inventory online.

“A lot of the computer retail outlets are run by the owners themselves and during the day they are very busy selling and attending to their operations,” Chua says. “At night time when they close shop, that’s when they know what to order to replenish their stocks in their shops and we would be close. And so we allowed them to order online and check the availability and we promise they would get the delivery the following day.”

He adds WSI recently equipped some of its delivery vans with Personal Digital Assistant (PDA) computers with mobile printers geared to do mobile inventory.

Chua says the roving van with PDAs works well in assisting its resellers with retail stores in shopping malls. “For example, if they have a customer who walked in and wanted a copy of Microsoft Vista and the store didn’t have the goods right there and then, they could just text us and the roving van would go immediately there to cut out the invoice and have the product delivered within 15 to 30 minutes.”

Unknown to many, one of the service innovations that WSI popularized were the product seminars conducted in movie houses.

“WSI pioneered the use of a movie house to do product seminars followed by a movie showing. We started that with My Cinema in Greenbelt 3. Now many IT companies are doing the same,” Chua says.

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