Outsourcing to the Small and Medium Business Market


Today I met with two very different companies that are alike in one important way: they provide outsourced services to small and medium sized business. I've always had a soft spot in my heart for small businesses---my Dad owned a small grocery store when I was growing up and I spent my formative years working there doing everything from pulling weeds to running the cash register. Consequently, I always enjoy seeing services aimed at making business better for the small business.

The first is a company called Nexpedite. Nexpedite provides "after click" services for eCommerce. That is, the provide warehousing and shipping services. What makes them stand out is their use of IT to provide differentiated services. A customer can place their goods in the Nexpedite warehouse and send order electronically, follow the shipping process, process returns, and track inventory. They do this via thin client web apps, downloads to Quickbooks, or even plain old Excel spreadsheets. Its another important piece of the B2B or B2C service line. They're cash flow positive right now, but small and having a tough time growing. What they need most is a way to do some marketing, beef up the technology infrastructure that sets them apart, and build out.

The second company I visited today is called DirectPointe. DirectPointe is smack dab in the middle of a market I've thought for a year or more has some real potential: IT services management for small and medium sized businesses. If you've read my Modular IT Organization paper, you'll know that I think IT organizations perform three core functions: value innovation, application development, and basic IT utility services. DirectPointe is aimed squarely at the last function. They provide fully managed file, print, and messaging services to organizations that have between 10 and 150 PCs. From all accounts they do an excellent job of providing reliable service for less than the organization was doing it themselves. I think they've got a pretty neat business model, especially the financial services aspect. They're another company operating in the black in tough times. They're also part of the Lindon Utah high tech community.