Provenco Group

Excellent customer knowledge and expertise in developing smart technology solutions for the retail oil industry has helped Provenco Retail Automation achieve exports sales of $32 million in 2006, up from $1.5 million in 2003.

Provenco Retail Automation is the international arm of Provenco Group, an Auckland-based publicly listed technology company with over 30 years experience developing EFTPOS and payment solutions and retail oil automation solutions. The Group’s operating revenue for 2006 was $154 million.

Chief Executive David Ritchie says over the past three years, Provenco’s international business has grown from being a successful local supplier of technology for the retail petroleum industry (service stations) to a thriving regional player, exporting its payment technology to more than 20 countries predominantly in the Southern Hemisphere, with recent expansions into India, Belgium, the Middle East and South-East Asia.

The company has developed sound partnerships with high profile oil companies across these regions, which use Provenco’s technology and systems to run their service stations, including point of sale, back office systems and payment devices.

Provenco has developed a suite of innovative products which can be sold as an integrated solution and implemented across multiple service station sites, or individual products that can be integrated into existing systems. Benefits to clients include greater security and reliability and lower IT, administration and hardware costs.

Mr Ritchie says continually developing new technology is one of the keys to success to working with the multi-billion dollar global oil industry; all Provenco’s research and product development is carried out at its Auckland and Palmerston North offices where staff numbers in the international division have increased by over 100 per cent in the last three years to 140.

“At the core of it is that oil companies are changing their business model and how they want to interact with customers, and technology is the enabler for that. Things like paying at the pump (pay@pump), or linking up with supermarkets for a discount. There are always changes going on and Provenco aims to be close to our customers and understand their drivers and trends to deliver technology solutions that make doing business easy for them.

“Our organisation is supremely flexible and responsive to opportunities and client needs through the ‘can do’ attitude and innovation of staff.”

He says Provenco is developing world leading technology, such as its G5 outdoor payment terminal for the service station market, one of the first to comply with the new EMV security standards. EMV is the new specification to ensure secure interoperation between chip cards and payment terminals. Provenco recently developed and installed a network of EMV card-readers for petrol pumps in Malaysia for Petronas and Shell, which together account for about 70 per cent of that country’s retail oil market.

Mr Ritchie says Provenco’s strategy is to time its entry into new export markets in order to meet immediate business drivers of the retail oil industry. Based on these triggers, it develops a local presence through joint venture partnerships or Provenco staff on the ground. It then builds credibility by establishing local reference sites.

Following its success in New Zealand and Asia, Provenco is now looking at creating a global presence, with reference sites currently secured and being developed in Kuwait, India, China and Belgium and the USA. It also has the rest of Europe in its sights.

A key success factor for Provenco is building relationships with global oil companies at multiple levels. Mr Ritchie says frequent travel to visit clients and potential clients is essential, and he points to Provenco’s first contract in India earlier this year, which was the result of three to four years of regular trips to the market.

Provenco Retail Automation is aiming for annual sales of at least $100 million by 2009, though Mr Ritchie points out that working in a contract-based business, the growth rate won’t be constant.

“Sometimes we have sizeable contracts and other times it’s quieter, and that’s when market and product development is a focus. But we are expecting very good growth.”

He says exporting technology is not without risk and New Zealand companies have to understand that things can go well and can also go the other way.

“There has to be an appetite for calculated risk to be successful. It’s tough and you don’t always get it perfect, but there’s absolutely no doubt that New Zealand technology companies have the expertise and ability to be successful international leaders in niche areas.

“There may be lower cost markets for R&D, but New Zealand is much lower cost for the high level of creativity and innovation around software development, and that is recognised by our customers.”

Provenco is also expecting strong growth from its other key export business, Vantex, a distributor of mobile and wireless technology in the Asia-Pacific, selling leading global brands. Its sales growth is being generated through a combination of organic growth and acquisitions.

Image: Provenco outdoor payment terminals being manufactured.

Contact:
Gabrielle Domett
Group Marketing Communications Manager
Provenco Group
Phone:    +64 9 361 0500
Email:     Gabrielle.domett@provenco.com
Website: www.provenco.com