SUSTAINING LONG-TERM SUCCESS AT BECHTLE AG

© 2008 WACRA®. All rights reserved ISSN 1554-7752

SUSTAINING LONG-TERM SUCCESS AT BECHTLE AG

Ralf Klenk and Gerhard Schick formed Bechtle Company in 1983. On March 30, 2000, Bechtle went public. Going public provided the funds for financing business development and it increased pressure on the company to succeed. On February 14, 2008, Bechtle AG reported that 2007 was the most successful year in its 25 years history. The growth rate of revenue was 13 percent, which was above the average for the market. Revenues were Euro 1.38 billion. EBT were Euro 59 million, an increase of 28 percent over 2006. Bechtle employed 4,200 people, an increase of 8 percent over 2006. During the past few years Bechtle was ranked first or second among the Top-25-IT-Service Providers. Bechtle management was convinced that the existing strong competition would lead to further concentration and specialization of the IT-Service Providers. CEO Ralf Klenk and the chair of the supervisory board, Gerhard Schick, were faced with the exciting challenge of sustaining Bechtle’s position in the market. The case presents the evolution of an innovative company in IT-service provider and IT-e-commerce business, the opportunity to analyze a competitive environment and to identify and evaluate strategies for sustainable growth. A detailed TN is available from the authors.

KEY WORDS: IT, service provider, managed services, acquisition strategy, growth strategy, competition, business model

THE IT SERVICE-PROVIDER BECHTLE IN COMPETITION “Ralf Klenk and Gerhard Schick founded the Bechtle Ltd. EDP-Technology on July 21, 1983. At that time Ralf Klenk was the only employee and worked in a 70 square meters (sqm) office in Heilbronn selling computers from Apple, Basis and Victor-Sirius. On March 30, 2000, Bechtle went public. Going public provided the funds necessary for financing business development, but at the same time it increased the pressure on the company to demonstrate success.

On February 14, 2008, Bechtle AG reported that 2007 had been the most successful year in the 25-year history of the company. The revenue grew by 13 percent to Euro 1.38 billion, which exceeded the Gerhard Schick

average rate of about 10 percent for the market. Compared to 2006 the EBT increased by 28 percent and attained Euro 59 million. Bechtle AG employed 4,200, representing an increase of 8 percent on 2006. In the past few years Bechtle AG has always appeared within the top two positions in the ranking of the 'Top-25-IT-Service Providers'. The management was convinced that the strong competition in the market would lead to further concentration and specialization of IT-Service Providers in the near future.” (Bechtle’s website, Time Line of a Success Story)

THE DEVELOPMENT OF THE BECHTLE GROUP

After completing his education as an industrial clerk in 1957, Gerhard Schick worked for several manufacturing companies in their accounting departments. From 1967 to 1994 he was Managing Director of Wilhelm Bott GmbH & Co. and worked with Professor von Jan, faculty member of the mechanical engineering department of Heilbronn University. Professor von Jan had the idea of entering the business of Electronic Data Processing (EDP) and together with Ralf Klenk, who graduated as a mechanical engineer in 1983 from Heilbronn University. He founded Bechtle in Heilbronn. Stefan Sagowski, Director of Finance, explains the origins of the company’s name “Bechtle”:

“Mr. Schick and Mr. Klenk set out two criteria for the name of the company: 1) the name should start with a letter near the beginning of the alphabet, and 2) it must sound Swabian (i.e. demonstrate its local roots). These criteria and the payroll list from Bott GmbH led them to the name Bechtle. Today, the name itself can be considered a competitive advantage.”

The company achieved the following milestones. Until 1992 Bechtle was primarily a regional company. In 1992 Bechtle started IT-direct marketing in the form of catalog selling on a countrywide basis. With approximately 100 employees and sales of approximately Euro 12.5 million, Bechtle was one of the largest IT-service provider companies in Southern Germany. The next decade was characterized by the expansion into other geographical regions. A number of acquisitions contributed to the growth in both Germany and abroad. In 1999 the legal form of the company was changed to a public limited company and in 2000, an additional 5.5 million new shares were issued through an IPO. Subsequently, funds of around Euro 145 million were available to support the further growth of the company either organically or by acquisitions. In 2002, the Bechtle group employed 2,254 people and generated Euro 751.7 million in revenue. In the IT-service provider business Bechtle had representations in 43 locations in 9 European countries, thus achieving a high degree of proximity to their customers. Construction of the new headquarters in Neckarsulm began in the fall of 2002. The new headquarters provided space for 700 employees and also contained a logistics center of 10,000 sqm. Company growth continued into the third decade. In 2005, Bechtle headed the list of the 25 largest IT-service providers in Germany. The year 2007 was the most successful in the 25-year-history of the company. For 2010 Bechtle has set the following goals: Euro 2 billion in revenues, EBT margin on sales should improve to 5 percent and the number of employees should increase to 5,000.

BECHTLE´S BUSINESS MODEL

Bechtle´s business model combines the IT-service provider business with direct marketing of IT products using e-commerce (IT-e-Commerce). In 2008, the IT-service provider segment, Bechtle was represented in approximately 50 locations in Germany and Switzerland (Exhibit 1). Bechtle offered a complete product line, independent of any specific manufacturer, to customers in many different industries. Bechtle´s fundamental principle of being “close to the customer” was reflected in its regionally based organization. The locations of the IT-service providers were, in general, less than 100 km apart, so that the radius of action of each location was 50 km and each customer could be reached from at least two locations within a short period of time.

The product and service portfolio was focused primarily upon IT infrastructure, which included IT applications. The range of products and services covered the complete life cycle for IT Infrastructure (see Exhibit 2), starting with IT-planning, through IT-integration and ending with IT-operations. The IT-service provider branches were supported by 20 competence centers. These competence centers were typically located at a particular IT-provider location and provided specialist support to both products and services:

e.g., Remote Services, Archiving Documents, Linux and High Performance Computing, IP Telephony, Security, Storage Solutions and Virtualization. A broad spectrum of education and training products supplemented the portfolio. Bechtle used the number of PC workplaces in a company to segment the market (see Exhibit 3). The main focus was business customers with between 20 and 2,000 PC workstations. Bechtle did not service private individuals and the small and home office market segment. More than 700 sales people and over 2,100 service experts (including more than 1,600 service engineers) were employed in the IT-service provider market.

Bechtle’s IT-e-commerce business was active in nine European countries (Exhibit 4). The Bechtle catalog presented the total product portfolio in 900 pages; it was produced in nine different country-specific versions (five different languages) and had a circulation of 180,000 copies. The catalogues were updated twice each year. The Bechtle web-shop (Bechtle direct in Exhibit 3), which was available in six different languages, offered approximately 30,000 products. The web-shop offered 24/7 services and was visited more than 121,000 times per week. Not only did customers have the ability to find and compare products quickly, but also they could obtain current information relating to the products availability, delivery dates, and prices. This information was up-dated daily. In addition, customers could request a binding quotation for specific orders. In a normal week, 4,000 orders were processed and 210 new products were added to the portfolio. The 'Bechtle information and ordering system' (bios®) was a customer-oriented online-procurement system aimed at reducing cycle time and costs. It was based upon a basket of products, defined by each individual customer (company), and supported a paperless order and delivery process. The bios®-platform could be connected directly with the customers enterprise resource planning (ERP) system, eliminating the need for separate data recording of orders and goods received. This was particularly useful for medium- to large-sized private and public organizations. More than 15,000 customers have used bios® and have reduced the cost of their procurement process by up to 60 per cent. Bechtle employed 60 product managers who continually reviewed the offers of more than 290 IT manufacturers and 400 distributors. Bechtle’s system accessed more than 1.7 million items of information, e.g., price and availability, and placed them in a centralized database resulting in one of the best administered databases for IT products. Every night, one of the largest “online reverse auctions” in Europe took place automatically. Typically an order volume of approximately Euro 2 million was available each night for bids throughout nine European countries. Suppliers who provided the lowest price combined with immediate availability were awarded the contracts. Using this system, more than 40 per cent of the prices changed every night. This enabled Bechtle to ensure the lowest prices and immediate delivery to customers. The business area IT-e-commerce established a second brand “ART DATACON” which had a similar business model to Bechtle direct (Exhibit 3) and was aimed at small enterprises and individuals. The multiple brand strategy enabled Bechtle to differentiate its product portfolio with respect to the use of its own brand and sales approach. Through a judicious selection of products, the cannibalization effect was estimated to be low, i.e., below 30%.

The departments of the company had a number of common functions at the primary and secondary levels (Exhibit 5). Bechtle Logistik & Service GmbH, located in Neckarsulm, managed and operated procurement and logistics activities for the entire group, except for the business in Switzerland. A centralized system of filling customer orders generated savings through synergy and scale. All suppliers (290 leading manufacturers and more than 400 distributors) were part of a European-wide logistics system, which included a completely electronic order and delivery process. An important part of this logistics concept was the so called “fulfillment solution”, in which customer orders were filled directly by Bechtle´s suppliers. This approach shortened lead times, decreased the cost of handling and inventory and reduced the risk of obsolescence (writing off inventory with a short life cycle).

Bechtle´s inventory consisted primarily of items with a high turnover rate and items necessary for projects in the IT-Service provider business. In 2006 the inventory turnover rate was 45 and the average investment in inventory was Euro 11.6 million. Because of its size, Bechtle was considered an important partner by large IT-vendors in the hardware and software market (e.g. HP, IBM, Microsoft, Cisco Systems, Fujitsu Siemens, 3Com, etc.). This not only affected the conditions of purchase, but also the degree of co-operation between the partners, which subsequently provided Bechtle with competitive advantages. An example of the co-operation with Hewlett Packard (HP) illustrates this. Nine HP employees, designated VIPMs (Vendor Integrated Product Managers), were working at Bechtle. They were more than just the extended sales arm for HP projects at Bechtle. They formed the central contact point for product announcements, changes to the HP solutions portfolio and joint sales campaigns. This

enabled Bechtle to provide an optimum service for customers regarding speed of action and competence. Further indicators of successful partnerships with vendors were the numerous certificates and commendations (from Microsoft, Cisco, etc.) confirming that Bechtle employed competent people.

The holding company Bechtle AG (see Exhibit 5), headed by Ralf Klenk and Thomas Olemotz, performed the following common activities centrally: human resource management, accounting (financial and managerial), corporate communications, investor relations, marketing, computer centre and internal training. This allowed relieving customers and market oriented IT-service provider units of administrative chores. The logistics and the accounting functions used the enterprise resource planning solution from SAP AG.

The corporate board, Ralf Klenk (CEO) and Dr. Thomas Olemotz (CFO), formulated the strategic direction for the Bechtle group. The strategy was then implemented with the assistance of a continuous reporting system involving the executives of the business units, the IT-service provider and the IT-e-commerce units. The decentralized, modular structure of the company permitted executives of the legally independent IT-service provider companies to act as entrepreneurs with a high degree of individual responsibility. Despite its size, Bechtle was able to keep its SMB (small and medium-sized businesses) characteristics when doing business with their typically mid-sized customers.

To prepare the company for future growth, the single strategic decision making level, in 2006/2007was divided into two levels: a corporate group level and an operations level with strategies for each business area. Gerhard Schick considered that Bechtle’s past success was based upon its ability to develop a successful relationship with employees, resulting in a highly motivated workforce. This was reflected by a fluctuation rate of approximately 10 per cent p.a., which was lower than the industry average. A motivated workforce was also considered a prerequisite for achieving growth in the future. Bechtle’s considerable development over the past 25 years is demonstrated by increase in the number of employees, the growth in revenues and EBT (Exhibits 6 and 11). Ralf Klenk describes the company's philosophy as the foundation for this development in a letter to shareholders in the 2006 annual report

“Endurance races like the famous ‘Le Mans 24 Hours’ demonstrate one thing: the winner is not necessarily the one who keeps his foot on the accelerator the longest. Over long distances in which the conditions are changing constantly, it is the combination of: speed, stamina, teamwork and strategy that lead to success. Bechtle´s ability to use these factors has been responsible for achieving its outstanding market position, and will be even more important in the future to promote further growth.”

THE MARKET FOR IT-SERVICE PROVIDERS

To describe the market for the IT-service provider division (Exhibit 7), Stefan Sagowski, the financial executive, used the value chain as follows:

“Basically, the value chain can be divided into three steps. The manufacturers deliver to the distributors who subsequently deliver to the value-added resellers (Bechtle’s IT-service provider division is a member of this group), who then sell to the end users. We see the IT-service provider as the integrator of hardware and software to provide an IT Infrastructure. If the IT-service providers are large enough they also act directly with the manufacturers. Large manufacturers, such as HP or IBM, have discovered the business of solution providers and as a result they are increasingly contacting the large end users directly and not using the distributors and resellers. This forward integration represents a fundamental threat to IT-service providers. This is especially true for our competitors who concentrate on the 500 to 1,000 largest companies in Germany as their customers. Bechtle concentrates primarily on upper, middle sized companies as customers which are not so attractive for the manufacturers.”

Exhibit 8 shows a ranking of the IT-service providers in Germany based on business results for the year 2006. Bechtle ranked just behind the market leader (Computacenter AG) and had a significant lead to the third company, PC-Ware AG. The results of an annual survey in 2007 (Wiltschek, 2007), to determine the expectations of the market in the near future, revealed the following: 80 per cent of the IT-service providers expected an improved investment climate compared to 2006; more than 95 per cent expected further acquisitions, mergers and insolvencies in the industry during the next 12 months. The most important concerns were: lack of qualified people (67.2 %), low profit margins (65.8 %), forward

integration by manufacturers (58.6 %), and increased competitiveness (45.4 %). Nearly 80 percent of the companies interviewed expected that their company would grow quicker than the market. This optimistic view is similar to that of the same survey taken in 2001. The prerequisites for realizing growth were the increased demand and the ability to find sufficient qualified personnel. 76 percent of the leading IT-service providers planned to hire new personnel within the next 12 months. The survey also posed the question ‘Who do you think is your most important competitor'? The results were the same for the past two years. 57.1 percent of the respondents placed Bechtle in the top position. However, Gerhard Schick named the large number of local, small companies as the real competitors of Bechtle. In the past Bechtle has been very successful acquiring such companies.

THE ACQUISITION POLICY OF BECHTLE AG Stefan Sagowski described the acquisition policy of Bechtle AG as follows:

“Actually the growth policy is structured very simply. In the IT-e-commerce business segment we have a growth strategy, which applies to all of Europe. We have a sustainable business model, which can be applied, easily to other European countries; therefore, Bechtle prefers internal/organic growth. Exceptions are the acquisitions in Switzerland and Spain. Compared to this, the growth policy in the IT-service provider business segment is different. The primary issue is geographical coverage; this is limited to German-speaking countries. The language and cultural differences make it unprofitable to acquire IT-service providers in non-German-speaking countries. Only companies that pursue the same business goals and offer potential for synergies are acquired. There is no diversification. For the individual IT-service provider, typical advantages of Bechtle´s network are: reduction of administrative accounting activities, a unified and centrally controlled inventory management system, purchasing advantages through central logistics (Exhibit 5), central marketing, and a unified market appearance. Integration into the group structure opens up new customer segments, which were not accessible to individual companies. In addition, excess-capacity and under-utilization can be balanced by moving personnel.”

Hence, the acquisition of an IT-service provider company was generally a gain for both the IT-service provider company and for the Bechtle group. As growth was a deciding success factor in this market, it was crucial to obtain competitive terms and conditions from the suppliers. These are achieved through volume purchasing. Sagowski described the expansion policy in more detail:

“We set ourselves the goal to be well represented over the entire German region and to achieve this approximately 60 locations were defined in 2000. By 2008, Bechtle was represented in approximately 50. Entering the Swiss market has been particularly successful. Using selective acquisitions Bechtle became the market leader in Switzerland in just two years. Austria still presents a number of opportunities for the group.”

Most of the smaller IT-service provider companies in Germany were founded in the 1980s and 1990s. Many of these founders were confronted with problems of succession planning and ensuring the continued success of their company in an increasingly competitive environment. Numerous companies had not been able to reach the necessary critical size. Bechtle received offers to buy such IT-service provider companies every week. Bechtle understood the market and recognized areas for future investment. A formal due diligence process did not exist at Bechtle. Gerhard Schick (the former chairman of the board) possessed an excellent knowledge of the business and he understood well the numbers of the business. As chairman of the supervisory board he still brought his experience to bear on acquisitions. Stefan Sagowski explained as follows:

“The key questions begin with the first telephone call, in which it is clarified whether it is worth beginning negotiations for an acquisition. The first evaluation criterion is the purchase price. Is the purchase price justified by the expected cash flow in future years? For Bechtle, a price that is between four to six times pre-tax profit is a realistic basis for negotiation. If the price asked is significantly higher, then this must be justified by additional strategic reasons. For example, is regional market leadership worth paying for? The second criterion for the evaluation of a purchase offer is that the company must have been profitable in the past “

Gerhard Schick explained further:

“We don't manage ‘turnaround’ cases any more. Due to changes in the tax laws, the incentive for carry losses forward no longer exists. If a company has not demonstrated its ability to take advantage of market opportunities in the past, then it will probably be unable to do so in the future, even with Bechtle´s support and, therefore, is not of interest to the group. We prefer companies with a return on sales of about 2 to 3 %. A higher performance rate is difficult to improve significantly and this also leads to an unacceptable high asking price.”

In terms of size, the acquisition candidate should have at minimum 30 employees with sales of around Euro 10 million, of which a substantial part should be generated by services. Smaller units are difficult to manage as self-sustaining organizations in the Bechtle network, because the amount of management support necessary increases disproportionately. As a third criterion Stefan Sagowski mentioned:

“The current financial results must also be verified as quickly as possible. If a company has not presented the result of the last financial year by August of the next year, then it is not considered further. Apart from the financial aspects, other criteria are also relevant. Bechtle´s primary business area is system integration and the administration of the acquisition must be consistent with this. Bechtle is not active in the area of IT-applications. This excludes software companies as potential acquisition candidates. Furthermore, an acquisition should not be dependent upon one particular customer, but rather have a mixed customer profile. Another important issue, which must be agreed upon before an acquisition is finalized, is who will lead the unit after the acquisition? Usually the former owner or managing director continues to lead the organization. If they decide to leave the organization (golden handshake), a suitable manager from the next management level will be appointed to ensure continuity within the organization. In addition to these criteria, other details are before finalizing an acquisition: a selection of accounting documents, the order book, contribution margin per order, profit and loss structure and in particular any non-recurring income and expense items. Further important factors are: the customer profile, the employee profile, the utilization of employees in service areas and the company culture. Of particular interest are the interaction with customers on the telephone, working hours, salary and wages and performance of employees.”

Gerhard Schick summed up Bechtle´s basic attitude as follows:

"If I visit the company and I realize that it is in disarray, even if the business shows good results, or if I feel that my negotiators are telling me stories, then my conclusion is that we do not have a basis for future cooperation."

The purchase negotiations were based on a standard contract, which included a list of 25 items to which the vendor had to provide specific guarantees. Gerhard Schick estimated the opportunities for further acquisitions in the market to be good, especially for Bechtle. The combined market share of the six largest IT-service providers in Germany was estimated to be approximately 10 per cent of the total market. Small IT-service providers who typically did not serve large customers, but focused upon regional, medium sized customers, made up the remaining 90 per cent. These companies were potential candidates for future acquisitions.

FUTURE CHALLENGES FOR THE BECHTLE AG

Bechtle presented its plans for 2010 in September 2007. To communicate the company vision and plans to employees and business partners, the most important goals were posted at the main entrance of the company’s headquarters (Exhibit 9).

Bechtle’s business included IT hardware and the software licenses and services necessary for installing and integrating the delivered hardware and software. The ‘traditional project based business’ did not appear to be sufficient to ensure success in the future. In the past few years the market had changed. IT-service providers felt increased pressure from their customers to lower prices and, at the same time, to improve systems in terms of security, availability, and stability. This required the delivery of more

intensive and extensive types of professional service.

Bechtle called this change “the move from a supplier to an operator” and their response was to re-organize their services portfolio into a product called 'managed services'. The provision of these IT-services could eventually result in the provider becoming responsible for all IT-activities of a customer. The range of services varied from a simple “all around” service for a personal computer, remote maintenance and eventually the complete operation of the IT infrastructure. Bechtle Managed Services (BMS) comprised of six main services each containing a range of service modules that could be configured to provide a solution to a customer's requirements (Exhibit 10). The different service modules illustrated in Exhibit 10 demonstrate that BMS was a logical development of Bechtle's services. For example, the life cycle services included: procurement, system configuration, software installation, on-site installation, hardware and/or software recovery and finally deletion of data and disposal of the IT equipment at the end of the life cycle. The monthly rate for a “powerful business PC” with a basic maintenance package was Euro 19.95 in 2007. This basic service could be enhanced by additional services such as virus protection, patch-management, backup/restore, and service desk etc. Managed services would become one of Bechtle's core products in the future. Ralf Klenk said: “We consider ourselves well positioned at the moment, but we are also convinced that we will need to improve ourselves." At the end of 2005, Bechtle took over the service of 50,000 PCs from IBM's 'strategic outsourcing' business unit. This contract strengthened the new business area. However, to accomplish this, Bechtle quickly needed to assemble several well-qualified teams. These were obtained by continuing the employment of those who previously worked for IBM. In this way, the necessary critical size to provide such centralized services was achieved quickly and efficiently. At the shareholders' meeting in June 2007, Ralf Klenk commented: "Without question we are currently at the beginning of the managed services business, but we already have marketable products and services which have proven themselves."

Beside the traditional hardware business and the expansion of high value services, Bechtle also planed to expand the software licensing business. The increasing complexity of the software license business made it necessary to concentrate the competencies and services in a single business. Comsoft Company had accomplished this in European. In addition to the traditional software consultancy and sales, a new service for managing the all software assets of a company had been developed. It appeared that future prospects were promising [Bechtle Annual Report 2007, p. 11 and 44].

In the 2007 annual report, Ralf Klenk wrote that the costs for the strategic investments in the field of managed services were higher than revenues. He expected the first surplus in 2008 and by 2010 revenues that could represent between one-third and one-half of Bechtle’s total revenues. The chairman of the supervisory board, Gerhard Schick, expected implementing the concepts developed into the existing business structure as one of main challenges in the near future. Implementation would require developing a high degree of competence in consultancy and also require changing the way business was done at Bechtle. The IT-service provider business of selling hardware and software licenses accounted for around 70 percent of Bechtle’s revenues. The move towards complete services would impact on future investment and revenue streams. Instead of receiving the traditional single payment for hardware and software with subsequent small payments for extra services during the life of the product, monthly payments over the contract period would be received. This required an additional business model for the IT-service provider unit and could, in some areas, conflict with the existing model. If a customer needed a new IT infrastructure the sales people of Bechtle could either offer a traditional sales contract or a contract for managed services. In this context an additional challenge would be how to adapt the performance management system for the IT-service provider units in the future.

APPENDIX

EXHIBIT 1: LOCATIONS OF THE IT-SERVICE PROVIDING COMPANIES [SOURCE: BECHTLE AG]

EXHIBIT 2: THE IT-SERVICE PROVIDING COMPANY SERVICES [SOURCE: BECHTLE AG]

EXHIBIT 3: THE MARKET SEGMENTS FOR THE IT-SERVICE PROVIDING COMPANIES [SOURCE: BECHTLE AG]

EXHIBIT 4: LOCATIONS OF THE IT-E-COMMERCE COMPANIES [SOURCE: BECHTLE AG]

EXHIBIT 5: BECHTLE´S BUSINESS MODEL [SOURCE: BECHTLE AG]

IT Service Provider

EXHIBIT 6: INDICATORS OF BUSINESS DEVELOPMENT AT BECHTLE [SOURCE: BECHTLE AG]

EXHIBIT 7: THE VALUE CHAIN [SOURCE: BECHTLE AG]

EXHIBIT 8: THE TOP TEN IT-SERVICE PROVIDERS IN GERMANY [WILTSCHECK 2007, P. 6]

Position Company Sales Mill.Euro* Employees

2006 2005 2006 2005 2006 2005

1 1 Computacenter AG & Co. OHG, Kerpen 958.4 905.0 3,639 3,591

2 2 Bechtle AG, Neckarsulm 815.9 784.2 2,772 2,850

3 3 PC-Ware AG, Leipzig 370.0 344.2 550 515

4 4 Cancom IT Systeme AG,Scheppach 232.4 191.5 1,254 567

5 7 TDM Gruppe Schwerte 230.0 135.0 450 360

6 5 Comparex Deutschland GmbH, Mannheim 205.0 190.0 680 650

7 6 ADA Das Systemhaus 152.3 185.0 1,000 1,038

8 10 Fritz&Macziol Software und Computervertrieb GmbH 150.0 111.0 410 310 9 8 Profi Engineering Systems AG, Darmstadt 140.0 135.0 260 250 10 12 Comline Computer & Softwarelösungen AG 113.0 102.0 328 338

*Sales Revenue in Germany adjusted by the market research company

Manufacturer

Distributor

Value-added-reseller

EXHIBIT 9: VISION 2010 FOR THE BECHTLE GROUP [SOURCE: BECHTLE AG]

EXHIBIT 10: THE BMS-SOLUTIONS [SOURCE: BECHTLE AG]

EXHIBIT 11: SELECTED FINANCIAL FIGURES FOR 2000-2007 [SOURCE: BECHTLE AG ANNUAL REPORTS]

Selected Financial Figures in thousands of-Euro 2007 2006 2005 2004 2003 2002 2001 2000 Revenues 1,383,453 1,220,138 1,178,269 1,088,133 791,907 751,709 645,588 488,576 Gross Profit 195,332 173,581 157,855 149,080 106,192 93,678 81,224 83,079 EBIT 58,253 45,730 41,195 38,509 27,051 18,418 13,140 EBT 59,006 45,859 41,172 38,326 27,240 18,987 14,423 8,498 EPS in Euro 1.9300 1.4472 1.3791 1.4036 0.9171 0.5956 0.4461 0.2700 Number of Shares in thousand 21,200 21,200 21,200 21,052 20,025 20,150 20,200 N,A, ITService -Providing Revenues 885,772 816,998 811,042 729,981 602,951 557,919 488,291 384,427 EBIT 33,065 22,597 18,607 18,574 17,182 11,919 7,971 6,038 IT-E-Commerce Revenues 497,681 403,140 367,227 358,172 188,956 193,790 157,297 104,149 EBIT 25,188 23,133 22,588 19,935 9,869 6,499 5,169 1,860 Total Assets 451,423 420,082 413,946 381,121 278,484 246,755 229,274 216,755 Total Non-Current Assets 145,560 142,329 140,305 119,634 96,906 76,697 65,805 56,604 Thereof: Goodwill 99,909 97,412 89,519 81,495 69,513 58,866 50,650 45,796 Other Intangible Assets 19,214 18,681 20,195 17,654 11,760 8,359 4,442 Investments 19,563 18,784 18,567 14,480 11,848 9,472 10,500 10,415 Total Current Assets 305,863 275,174 273,641 261,487 181,578 170,058 163,469 160,151 Thereof: Inventories 46,817 39,006 41,829 36,541 28,962 24,396 20,432 24,299 Receivables. 189,312 181,086 164,291 142,462 106,186 95,332 55,269 72,007 Cash and Cash

Equivalents 52,300 36,710 48,178 61,497 33,694 37,867 41,200 21,117 Total Liabilities and Stockholders' Equity 451,423 420,082 413,946 381,121 278,484 246,755 229,274 216,755 Stockholders' Equity 276,465 252,033 237,447 213,450 180,224 164,213 160,601 156,532 Non-Current Liabilities 23,758 24,618 26,880 26,106 9,614 8,847 1,634 2,657 Current Liabilities 151,200 143,431 149,619 141,060 88,032 73,695 66,969 57,565

REFERENCES

Bechtle AG (Hrsg.): Verkaufsprospekt/Unternehmensbericht. Bechtle AG. Gaildorf 2000, http://www.bechtle.com/_rsc/content/download/ir/emissionbroschure.lang_de.pdf (27.2.2008).

Bechtle AG (Hrsg.): Annual Reports of the Years 2000-2007, http://www.bechtle.com/company/ir/ publications/annualreports/index.html?mo= (21.7.2008).

Bechtle AG (Hrsg.) Eine Präsentation der Bechtle AG, Neckarsulm September 2007, http://www.bechtle.com/_rsc/content/download/ir/unternehmenspraesentation.pdf (27.2.2008).

Mahler, G.: Systemhäuser entdecken Service als Rezept gegen die Absatzkrise. In: Computer Zeitung, Nr. 45, 8.11.2001, S. 10.

Wiltscheck, R.: Die 25 größten Systemhäuser in Deutschland. In: CPCompact, Juni 2007, S. 5-10, http://www.channelpartner.de/fileserver/idgwpcp_new/files/cp_compact_top_25_systemhaeuser_2007.pd f (27.2.2008).

Wiltscheck, R.: Systemhäuser in Deutschland: Stimmungslage 2007. In: CPCompact, Juni 2007, S. 14-16, http://www.channelpartner.de/fileserver/idgwpcp_new/files/cp_compact_top_25_systemhaeuser _2007.pdf (27.2.2008).

Website of the Bechtle AG: http://www.bechtle.com The following interviews were conducted:

Aug 09, 2001: Preliminary Interview with Dr. Rainer Eggensperger, Member of the Board of Bechtle AG, with the basic definition and formulation of the type and content of the study.

Oct 19, 2001: Interview with Stefan Sagowski, financial executive of Bechtle AG, currently CFO EU Nov 26, 2001: Interview with Gerhard Schick, Chairman of the Board of Bechtle AG.

Dec 18, 2001 Interview with Dr. Rainer Eggensperger, at that time Member of the Board of Bechtle AG Feb 2, 2008 Interview with Gerhard Schick, Chairman of the Supervisory Board of Bechtle AG.