Wax Digital apply marketing nous to procurement technology

It’s been an eye-opener for me in the last few months, getting closer to the landscape of interesting procurement-related technology firms.  One whose name kept popping up was Wax Digital; the name comes from the origins of the firm which was as a digital media outfit that did have a recording arm (‘wax’ as in old records).  But from those beginnings, they got into designing apps for clients, including catalogue and B2C type products, which eventually led them to more conventional ‘procurement’ technology products.

The firm is still owned principally by the founders, Daniel Ball and Paul Ellis. Their marketing background perhaps explains a core belief; that “intuitiveness is fundamental”. For example, they look to replicate the ‘Amazon type’ user experience in the B2B environment rather than the traditional ERP approach.  And that rubs off into other user-friendly features; being able to approve requisitions via email without having to go into the system for instance.

We spoke to Wax themselves and to one of their clients, the County Durham and Darlington NHS Foundation Trust. We’ll feature that conversation early next week, but it is an impressive story. Indeed it may surprise some readers to see a public sector organisation that has  implemented really strong processes that often elude private firms, in areas such as ‘no PO, no pay’ and rationalisation of demand through supplier catalogues.

Anyway, Wax has been going for about 10 years now. Based in Manchester, they offer a full eProcurement solution; that is, one that encompasses both P2P cycle (requisitioning, ordering, stock control, invoicing) and a sourcing solution (spend analysis, RFX, auctions etc).  We haven’t had the full product demo, and Wax would admit to not covering every base (advanced sourcing / optimisation for instance) but for a lot of potential clients, they offer everything that is needed in the procurement technology space.

Some numbers - they’re turning over around £5 million annually now, with recent bottom line margin of better than 10%, 72 employees, 58 customers and 240,000 users in 34 countries.  Their software was all designed in house, and they’ve historically spent over 20% of turnover on product development.  Product design is modular and designed ‘to make it easy for third parties to configure’.  It integrates well with ERP, they say; they’ve developed their own ‘middleware’ and have a dedicated integration services team to help clients manage implementation issues. And from the beginning, they’ve worked principally  on an on-demand, hosted basis.

They also support some clients on the sales side – for instance, running the catalogues and stock control system for a major web-based entertainment B2C retailer.  Although we’re featuring their NHS case study soon, their client base is skewed towards the private sector actually, with large clients in retail, media, hospitality and other sectors. (We may have another client story at some stage from the private sector).

Why aren’t they bigger, I wondered, given what seem to be impressive references and product range? Measured, profitable growth (and profit is something not all growing tech firms care about) has been their mantra, so they have proceeded along a steady growth track.  But they’re aiming to take it up a gear; they implemented a reseller programme last year, looking to partner with consulting firms to extend their reach; and they’re pushing into the mid-market, partnering with Sapphire Systems for lower-cost deployments.  The UK is 75% of their business at the moment, but international growth is another target.

I’m hoping to have a full demo as well in the not too distant future, and get Jason Busch to cast his expert eye over the offering. But there seems no reason why Wax Digital can’t grow pretty quickly from here; and they’re an interesting company to have on your radar, particularly if you’re attracted by the prospect of the ‘end to end’ approach to eProcurement, encompassing P2P and eSourcing capability.

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