Northampton-based EBS (Elite Business Systems) was, more than most airtime distributors, in the eye of the cashback storm two years ago as the dealer market unravelled around cashback and misselling.
EBS has been among the leading connectors for network operators Orange and 3 for several years now and was Orange and 3’s highest volume connector between 2004 and 2006.
The distributor helped build up Orange in the prepay boom of the late 1990s, when Gareth Jones (now EBS non-executive chairman) was in charge of Orange’s dealer operation.
And it was still putting through vast quantities of consumer contracts for both Orange and 3 through the middle of the decade, as the market share ‘landgrab’ started to fade.
But EBS got stung by cashback in 2007 only because the changed market forced its dealer partners to take measures to compete.
“Cashback dealers aren’t something we jumped on the back of. We had dealt with these people for 10 years, and, as their businesses developed, they just got themselves involved in cashback dealings,” according to EBS commercial director Mark Jennings (pictured left).
“And, we’ve not witnessed a drop off in the past year or so in terms of [dealer] numbers – compared with three years ago which is when the dealer market really started to suffer.”
Asd the sales channel has developed and matured over the past 18 months, EBS has managed to stay consistent in terms of its client list and its supplier base, as well as its product portfolio.
Any distributor’s claim about dealer accounts should really be approached with a big bag of salt. The market has contracted to such an extent that most airtime suppliers rely on fewer than 100 consistently-active accounts for the lion’s share of their connections.
No matter, EBS claims 650 dealers across the board and 100 regularly active, but makes clear it is operating in varied channels.
Large-scale call centre operations, is a channel generally criticised for misselling, but still comprise a significant chunk of EBS business.
Jennings makes clear its big-volume fulfilment partnerships are robust and reliable.
He says: “We’ve focussed a lot of our business on fullfilment and servicing a lot of call centres – credit checking their orders, provisioning and despatching handsets. We deal with their returns too. It’s just a part of the business, but has been very successful over the past five years.”
EBS uses Orange and 3 for airtime connections. EBS was originally set up in 1985 as a B2B seller, and also developed a string of 13 retail outlets in its time, before changing tack to facilitate business for other dealer operations.
Between its launch as a distributor in 1996 and its appointment by 3 in early 2004, it worked as an Orange solus supplier, like Mainline and Midland. But EBS retained its independence (Orange took stakes in these others), and expanded its supplier partnerships.
Jennings remarks: “We’ve gone from being like Mainline or Midland, with just one network on our books, to gradually securing a number of other distribution partnerships.”
Now, in this recessive market climate, EBS’s twin supply deals for airtime connections look to be right on the money.
It does not have the onerous task of keeping five network paymasters happy, simultaneously. And its network allies appear to be reasonably consistent in their vision of the dealer market, with Orange’s new revenue scheme a friendlier version of certain others’ for traditionalist connectors, and 3’s landgrab ongoing and its SME play expanding.
Sales director Andrew Dawson (pictured right) observes: “Some distributors have lost [partner] networks – think of Avenir, which was doing all the networks when [former managing director] Tanny Price was there. She was perceived to be the best thing since sliced bread because of that.
“But now Avenir is only dealing with a couple of networks really, and is actually benefiting more because it can focus its energy on them, rather than all five.”
Jennings adds: “The argument is that you may be over-exposed by connecting all networks, and that you spread yourself too thinly.”
Full article in Mobile News issue 439 (May 18, 2009).
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