Strategy update: Interesting new opportunities in the market - new offerings and long term targets.
Basware has updated its strategy for 2010-2012. The Basware Responsive Strategy framework allows the company to act with agility and sensitivity based on the company’s situation, market trends and other changes. The Responsive Strategy framework includes follow-up and analysis of internal and external trends as well as the company’s vision, mission and operating principles. Basware’s operating principles comprise of the company’s values, corporate governance and responsibility.
Objectives - Global leader in Invoice automation, Procurement and e-invoicing
The company aims at maintaining its position as a leading global supplier of invoice automation and procurement solutions. Invoice automation growth is strongly supported by a new mid-market SaaS (Software as a Service) “pay as you go” -offering to selected high potential markets.
Basware aims also to become a leading company in e-invoicing worldwide. E-invoicing and supporting Connectivity Services are now targeted to connect suppliers and buyers also outside of Basware’s existing software customer base leading into a higher potential.
The company’s long-term target is to grow annually more than 50% in SaaS, Connectivity Services and e-invoicing. SaaS, Connectivity Services and e-invoicing are scalable models and offer an increasing profit potential in the long run. The company’s long-term target is to grow annually more than 10% in License Sales, Maintenance and Professional Services. The target for operating profit margin is between 10% - 20%.
Geographical growth
The regional focus for Basware remains unchanged with following adjustments. All regions will have a centralized organization for increased efficiency during this strategy period. In all regions the high growth of e-invoicing is supported with a wide range of connectivity activities.
The North American segment is strategically the most important, and the company focuses mainly on direct sales development in this market. As new focus areas in the North American market, the company will target several new industry segments. For mid market Invoice automation growth a new SaaS “pay as you go”- offering is introduced.
In Central Europe, the UK, Germany and France will continue as the strategic growth markets. Medium-sized businesses are approached also with SaaS with a new “pay as you go” -offering. The Northeast segment, covering the functions in Finland and Russia, will focus on Russia in terms of growth. Finland will maintain a solid position in the company’s business with high profitability.
In the Scandinavia segment (Sweden, Norway, Denmark), profitable business growth will continue. Services offered to the current customer base will be reinforced in both the Scandinavia and Northeast segments.
In the Asia-Pacific segment, growth will focus on developed market areas in the short term, such as Australia, and also other markets in the area in the longer term.
During the next few years, the company will reinforce its direct sales operations and develop its partnership network towards a few strong partnerships.
Basware will continue expanding its Indian unit, which will improve the scalability, flexibility and efficiency of product development, for instance, and balance costs. During the next two years, the number of personnel (including product development and other functions) is expected to more than double.
Business operations
Basware’s business operations consist of License Sales, Maintenance, Professional Services and Automation Services (e-invoicing, Connectivity Services and SaaS). They comprise of the Basware Enterprise Purchase to Pay (EPP) product family and financial administration products.
Basware has further expanded its Automation Services offering with additional functionalities in, e.g., e-invoice service, supplier management and scan and capture services. Automation Services solutions are used in all market areas. The purpose is to increase the automation rate of customers’ functions and improve transparency and predictability of profitability throughout the purchase to pay process. Basware is one of the key drivers in transformation of purchase and invoice messages to fully electronic processing.
According to Basware, internal processing of paper invoices in companies will become obsolete. In practice, from the customer’s point of view this means that customer companies are able to outsource and automate functions that they have previously performed in-house.
The company’s target customer group will be expanded in selected markets by productizing the offering to better serve the small and medium-sized customers with the SaaS distribution model.
Business acquisitions
The company continues to actively screen potential acquisition targets. These include the strategic segments and the expansion of Automation Services in particular.
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