Inside Axis Communications' U.S. expansion plan

Last week, Axis Communications announced a “U.S. Expansion Plan,” which the company said is intended to help bring them closer to their channel partners and end user customers across the country. As part of the plan, which went into effect on Jan. 1, Axis has designated six U.S. Business Areas (Northeast, Mid-Atlantic, Southeast, Midwest, South Central and West), all of which are slated to have their own dedicated, customer-facing offices complete with an Axis Experience Center.

Axis has experienced tremendous growth in North America over the past several years and added more than 60 new regional employees in 2013 alone. From 2010 to 2012, the company opened new offices in Canada, Mexico and a new North American headquarters in Massachusetts. Three new offices are planned to open in 2014, including the Northeast office located within Axis’ Boston-area North American Headquarters that opened as of last week, the Midwest office opening in Chicago planned for Q2, and the West office opening in the Los Angeles-area during the second half of 2014.

SIW recently caught up with Axis Communications General Manager Fredrik Nilsson to discuss the company’s growth and how this U.S. expansion will help provide added support to their partner network.

SIW: What was the major impetus for this expansion plan in the U.S. and in what ways will it help you to provide better support for your channel partners?

Nilsson: We’ve been opening offices over the past couple of years… and the focus of all of those facilities was not only offices for the employees, but more importantly for the business and briefing center we call the Axis Experience Center. That includes both meeting facilities, demo facilities as well as training facilities for our customers. By doing that over the last couple of years, we found that our partners liked it and we had more than one visit a day last year when we were fully opened in (our Chelmsford, Mass. office) and there’s also great activity in Toronto and Mexico City. We wanted to take that out to more places throughout the U.S.

SIW: How have you seen market demand for network video solutions grow in the U.S. and is part of this expansion plan intended to help you and your partners keep pace with this increase in demand?

Nilsson: When we look at the growth we’ve had over the years, we’ve had a pretty consistent rate of growth and one of the successes that we’ve had with our product is not necessarily focused just on having the lowest price, but rather we focus a lot on education, focus a lot of partnerships and focus a lot on being there with the customer to make sure they understand the benefits and technology and are specifying the right product. As we see more and more of those partners, more and more of those projects and more and more end users who are pressed to have discussions directly with the vendor, even though we never want to sell direct to the end user… they want to have a direct relationship with us to understand the long-term roadmap and the benefits of the product. With our position of being that company that focuses a lot on values - while a lot of things may be done over email and phone today - face-to-face meetings and getting out and showing and demoing the product are our main focus when it comes to driving sales in the market.    

SIW: How will having these six business areas impact your various training programs?

Nilsson: Last year, we had instructor-led training for some 4,500 people throughout North America. And a lot of those are being done where we have 15 to 30 partners in a room and classes that range from one to five days. We have our own trainers that travel throughout the U.S. to conduct these classes and the benefit of having our own facilities is that we can have all of things they need – all of the computers there, all of the cameras being put out, projectors – so it can all stay ready for people to improve their training even further. For the trainers, hopefully, they won’t necessarily have to be on the road but they can be at their home base and come out for trainings there. We will still take (trainings) on the road and other places where we don’t have offices, but we’re going to increase the number training that we’ve had.

SIW: Do you believe that this expansion will help you broaden your partner base and are there any particular regions within which you’re looking to increase your footprint?

Nilsson: We continuously expand our base, both by numbers and also by partners that do greater revenues and become more and more loyal. We are a very long-term focused company, so we focus on long-term partnerships, but the market is always changing and people lose partners. The best way to show them what we can do and how we’re different is to first of all, show that we have their back and will work with them to help them out with a product or project.

SIW: How much was this decision to expand impacted by the rebounding U.S. economy and the increase that is expected in new construction over the next several years?

Nilsson: We’re a public company and we want a pretty consistent growth rate. In our public statement, our CEO said our long-term goal is to have growth of around 30 percent a year. Axis did $720 million (in revenue) last year and close to half of that belongs to North America and, of course, the U.S. is a big share of that. And if you start adding 20 percent to those kinds of numbers it becomes relatively large. Again, we are a long-term based company and in this economy or a bad economy, we want to show our commitment to the market. We think it is rebounding and doing better right now, but even when it wasn’t looking so great a couple of years ago, we continued to expand and hire people. It’s not necessarily a reaction to a short-term opportunity of the construction market rebounding, it is more of a long-term shift of the market over to IP and also a more long-term shift from manpower and guards over to electronic security.