Eight years after starting his business XL in a one-room, one-desk Johannesburg office, Jacques Duyver now runs a company with an annual turnover of Rl billion and has plans to set up operations in the UK and Australia.
Drive around Johannesburg and you will see the orange billboards advertising Itec everywhere.
But Itec is now a lot more than the distributor of Konica office equipment it started out as. Not only is it SA's fastest-growing digital-imaging solutions provider with an ever-growing share of the office equipment market, last year it expanded successfully into the lucrative telecommunications market.
For Duyver, founder, majority shareholder and CE of Itec, it's a dream come true. From R30m sales in its first full year of operation, sales hit R800m last year and are set to grow further.
The compound 150% sales growth over the past seven years is matched by strong profitability, he says. "Our turnover for this year will be more than Rl billion with the strong contribution from Itec Telecoms."
The company's fortunes have been boosted by the strong rand, which makes importing and distributing equipment in SA a lot more competitive.
This year will also see the opening up of Itec operations in the UK and Australia, possibly in the third quarter. "We are finalising our business plans and
Jacques Duyver From one office to R1 billion will build partnerships in these countries once we are there. We are confident of this move because we are good at starting new operations," Duyver says.
Apart from SA, Itec has offices in SA's neighbouring states and Reunion.
Duyver has grown Itec without any reliance on debt funding. He has structured the company into three divisions: office automation, finance and telecoms — all of which are expected to boost profits this year.
Itec Telecoms was launched last year in a joint venture with empowerment firm Tiyende Telecoms, whose directors include Sasol executive Max Sisulu, SABC chairman Eddie Funde and former Denel chairman Ian Deetlefs.
Duyver expects the telecom division's turnover to be between R40m and RI00m by year-end. "Our partnership with Tiyende is ideal; they bring skills and we offer capital and infrastructure," he says.
Itec has pumped R20m into the business and gives the telecom group access to 18 000 corporate customers and its national dealer network.
The concept behind Itec Telecoms is one of a "virtual network operator" (VNO), which takes advantage of the convergence between data and voice communications. VNOs act as intermediaries between corporate customers and network operators such as Telkom, the cellphone companies and Internet service providers.
Itec's move into the telecom industry is likely to put it on a collision course with Altech and its subsidiary, Auto-page, as well as with Reunert subsidiary Nashua. Both have plans to position themselves as VNOs.
Some of these are also the group's competitors in the office automation market, where Nashua holds a 23% market share, followed by Minolco with 15% and Csinoa with 10%.
Itec, which has added Minolta products to its dealership since Konica and Minolta merged recently, has 11% of the market but Duyver plans to grow the share significantly. "We want to be the major player," he says.
Itec has 65 franchises in SA, 24 of which are black economic empowerment (BEE) franchises. They employ almost 600 staff. Duyver, who is aiming for 50% BEE-owned Itec franchises by 2006, believes this route allows for "true BEE entrepreneurship". Makweru, one of its BEE dealerships, is among the fastest growing in Itec's network and already boasts Telkom, Standard Bank, SAB and the Reserve Bank among its clients.
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