Domino Comptech Holdings
Products and Services
DCH provides the management, marketing, and financial expertise to assist those companies that we acquire in continuing to maintain a strong and steady growth pattern.
Kettle-Moraine is especially focused on providing network systems and services to small, medium, and large businesses. The systems include both PC-based LAN systems and minicomputer server-based systems. Our services include design and installation of network systems, servers, and printers in addition to full training, and support. KMCI’s production department assembles the branded lines of servers, workstations, and laptops where each phase of the production process is governed by an ISO 9001:2000 Quality Management System. This certification is also registered through British Standards Institution, Inc.
3.1 Product and Service Description
The hardware provided to KMCI’s customers includes servers, workstations, laptops, and network hardware. KMCI’s production department assembles the branded lines of servers, workstations, and laptops where each phase of the production process is governed by an ISO 9001:2000 Quality Management System. This certification is registered through British Standards Institution, Inc. KMCI is also a charter member of the North American System Builders Association (NASBA). Lynx Caracal, President and CEO of KMCI, currently serves on NASBA’s Board of Directors.
KMCI was the second company in North America to be ISO 9001:2000 certified to the newest standard by the British Standards Institute, the largest of six ISO auditors worldwide. Certification to ISO Standards for procedures and policies ensures KMCI products and services will be of consistently high quality, offering higher levels of assurance to KMCI customers. This certification allows KMCI the unique ability to compete for state, federal and international contracts as more companies require ISO certification in bid proposals.
KMCI’s trained engineers provide a full range of services. They are matched with the company’s experience in Local Area Networks (LAN), Wide Area Networks (WAN), and both single and multiple server installations. Network engineers hold certifications including Novell, Microsoft, Sun Microsystems, Cisco, Unix and Citrix.
KMCI provides on-site and remote services through trained professionals for the company’s branded product lines, as well as for IBM, Compaq, Lexmark, Hewlett-Packard, Dell, Gateway and others. The infrastructure services offered by KMCI include data network wiring, telephone cabling, CATV wiring, fiber optic cable, and wireless connection.
3.2 Competitive Comparison
Domino Comptech Holdings doesn’t compete with any other companies in or around Central City, the State of Gulfstate, or in the neighboring states; however, KMCI is in direct competition with several companies.
KMCI competes with IBM, Gateway, Dell, and Compaq and all original equipment manufacturers (OEMs). Recently Compaq, as well as many other OEM’s, announced they will focus more on computer services rather than hardware sales. KMCI has already capitalized on this strategy and will continue to place an emphasis on the company’s services, which have a proven higher margin than product assembly.
KMCIs greatest advantages over its competition are:
- We sell, build, test, and ship directly from our own facilities.
- We maintain a 5% or less failure rate.
- We have designed and Implemented Shrinking Expenses Advancing Technology (S.E.A.T.) Management
The S.E.A.T. Management program allows companies, institutions, schools, colleges, universities, and state government offices to purchase the technology (hardware, servers, printers, software, networks, on-site service, and help desk) as a line item expense (over a three year contract). When the contract terminates we remove the old technology, and replace it with brand new technology. The result is a guaranteed new sale every three years. Full disclosure and sales information are contained in the marketing section of the business plan.
3.3 Sales Literature
DCH is a holding company and as such doesn’t use sales literature; however, the companies that we own do. Samples of those pieces are attached.
3.4 Future Products and Services
Benefits of Acquiring a Software Company
Domino Comptech Holdings is aware of several companies which provide integrated business software solutions. These software programs generally provide fundamental business process management as well as expanded functions for multi-location product distribution, inventory management, customer service contract management, field service operations, help desk and sales force automation.
This type of system is designed to improve business operational performance and provide knowledge in order to achieve profitable growth. Generally these companies have a strategic focus on one industry, which makes their company dominant in their market. These companies have a proven track record of a long-term loyal customer base, positive cash flow, internally-generated capital and a very positive bottom line.
DCH proposes to acquire a software company such as this and use KMCI’s relationships and positions in the computer industry to enable the software company access to a vast new market of computer dealers. In addition, DCH will introduce the concept of S.E.A.T. Management to the new and existing software customers. This will allow them to forego the major up-front capital investment needed to update hardware and change software. In place of the traditional up-front cash outlay, the business will pay a license fee per month for each terminal, which will include all hardware, network and software services.
There is a large potential market of small dealers who have, in the past, been unable to afford the up-front capital expenditure required to purchase the product. By providing them a total solution which includes application software, hardware, and services, the newly merged company will drive sales and profits to a previously unreachable customer base.
The first step in conducting the merger will be to consolidate back room services. Upon completion of this consolidation, other departments will undergo integration based on further analysis. An effective integration of the companies is anticipated for completion within one year. The merger will result in the following outcomes:
- Creation of a business culture focused on fast growth.
- Completion of the graphic user-interfacing project within six months. Movement of the product to a SQL database platform.
- Launch of the product into several other verticals (computer dealers and the medical industry being the first targets).
- Provision of true business consultation.
- Acquisition of additional technical employees by relocating Programming and Development to a major metropolitan area (if deemed necessary).
- Increase deployment by delivering the software application via the ASP model* (defined below) for low-end users and customers that want to outsource their entire IT services.
*Definition of ASP: Application System Providers enable the use of business applications through the Internet and other low-cost communications vehicles. ASPs offer organizations low overhead combined with cost-effective and timely use of strategic business solutions. Using browsers or other thin client types of access, these customers — primarily small or mid-tier organizations — subscribe to the ASP’s applications. These applications include supply chain integration, distribution and human resource management. Using the ASP model, the customer is not required to purchase the hardware, operating systems, databases, licenses, IT staff, and ongoing overhead associated with buying or building an application. A subscription application offers end-user organizations an option more affordable and efficient than buying and maintaining a private network.
Benefits of Acquisitions of Storage, Telephony and Security company
The evolution of technology and services, combined with recent terrorist events, has created a new emphasis on storage, telephony and security. Because of the limited market size within a small area, DCH felt it best to look for an acquisition located in a major metropolitan area. We decided to incorporate these services through acquisition, rather than expansion of existing companies, because of the high level of training required for necessary technicians. Some of the various certifications needed in this area cost in excess of $100,000. Finding a company with multiple employees with the necessary certifications and an existing client base allows us to leverage the revenue stream. A further explanation of the three areas key to this acquisition follows:
Analysts predict storage area networks (SANs) will be deployed by 70% of all mid-to-large sized companies by 2002. As data grows enormously at a rate of 60% per year in normal businesses and up to 100% per year in e-businesses, SANs will help to ease data management and the storage capacity needed to maintain it. The market for disk storage systems is forecast to rise about 16% a year to $42 billion by 2002, according to industry analysts.
Storage Devices and Systems:
Fibre Channel is being provided as a standard disk interface. Industry leading RAID (Redundant Array of Independent Disks) manufacturers are shipping Fibre Channel systems. Soon, RAID providers will not be regarded as viable vendors unless they offer Fibre Channel.
Storage Area Network:
The network behind the servers linking one or more servers to one or more storage systems. Each storage system could be RAID, tape backup, tape library, CD-ROM library, or JBOD (Just a Bunch of Disks). Fibre Channel networks are robust and resilient with these features:
- Shared storage among systems
- Scalable network
- High performance
- Robust data integrity and reality
- Fast data access and backup
- Disaster Recovery
In a Fibre Channel network, legacy storage systems are interfaced using a Fibre Channel to SCSI bridge. IP is used for server to server and client/server communications. Storage networks operate with both SCSI and networking (IP) protocols. Servers and workstations use the Fibre Channel network for shared access to the same storage device or system. Legacy SCSI systems are interfaced using a Fibre Channel to SCSI bridge. Fibre Channel products have defined a new standard of performance, delivering a sustained bandwidth of over 97 MB/second for large file transfers and tens of thousands of I/Os per second for business-critical database applications on a Gigabit link. This new capability for open systems storage is the reason Fibre Channel is the connectivity standard for storage access.
“Computer telephony” describes the technology that enables voice and data to travel the same network (LAN/WAN) and function in an integrated manner. In the past, all businesses maintained two totally separate network infrastructure, one for voice and one for data. Each infrastructure had its own independent communications links and hardware. Each infrastructure had its own separate set of applications for usage and management. As a result of the total isolation of voice and date networks, infrastructure costs were high, administration costs were high (because separate teams of engineers were needed to manage each), flexibility was limited, and interoperability was non-existent.
A new technology emerged that began closing the gap between voice and data. The new technology was Voice Over IP (VoIP). With VoIP, businesses could begin to leverage their existing, and much less expensive, data infrastructure to handle voice traffic as well. This opened the door to cost savings through lowering infrastructure costs (reducing the number of dedicated voice circuits) and lowering long distance costs between corporate sites (because voice calls could travel across pre-existing data links rather than the public switch phone network).
Seeing the great efficiencies of converging voice and data (and video for that matter) onto one IP-based network infrastructure, the demand for business applications has created a whole new industry. This hot new market is called IP Telephony (or computer telephony). IP Telephony has created the technological foundation for unified messaging (unifying e-mail, voice mail and faxes into a common inbox), interactive Web-based call centers, greatly simplified systems management and more. This new market is still in the emerging phase, so many more applications will be forthcoming.
In fact, the business applications are limited only by our creativity! To quote a Cisco article, “the numbers show that migrating to IP telephony is possible and profitable right now. According to a survey by Stamford, Conn. based Meta Group Inc., 26% of enterprises have already begun to move to integrated voice and data networks, and 42% plan to begin such a migration within the next two years. Two thousand Cisco Systems Inc. customers have already implemented such merged networks, ranging in size from several hundred phones to 25,000 phones.”
Sensitivity to security issues has risen dramatically with the propagation of the Internet as a business tool, new government regulations regarding privacy, and concern with terrorism. The Internet has opened up the enterprise network to the world! But in reality, security has always been a serious issue. The Internet has simply illuminated and intensified awareness of the issue. Security services must assess the impact of security policies (or the lack thereof), practices and technologies at three main levels of the infrastructure:
- Physical security refers to the physical safety of electronic data from unauthorized physical access. For example, can just anyone walk up to a workstation on the network? Could someone literally grab a laptop off the desk and walk out with it, and the sensitive corporate data that it contains? These are examples of physical security issues.
- Systems security refers to the safety of server- or workstation-based user/application data to unauthorized access. For example, are there proper security parameters around system user accounts to prevent unauthorized user access to sensitive material, such as payroll data? Are auditing tools in place to detect unauthorized access attempts? Are clearly defined security policies in place?
- Infrastructure security refers to the safety of application data, system data, user information and other network traffic from unauthorized access, monitoring or impediment from outside entities. For example, does the organization utilize an optimized firewall? Are VLANs being utilized where it makes sense? What is the organization doing to prevent attacks from the outside that could overload routers or servers thereby denying access.
DCH will structure its future departments so as to facilitate collaboration in meeting our customers’ needs from all angles of technology use. This will allow KMCI to offer additional services to its customer base, and will allow the software company customer base to enjoy the benefits of the S.E.A.T. Management program.
From 2000 through 2002, the technology industries have taken a huge financial hit. The most noticeable change was that all companies, regardless of industry or size, simply stopped purchasing computer hardware and software in the same quantities as before. The companies switched their focus from replacement of antiquated equipment to upgrading that equipment (if possible). In addition, companies that had projected spending on hardware, software, and servers, immediately began revising their projections, and purchasing or upgrading fewer and fewer units. This change was felt across the industry.
In response to this downward trend, KMCI designed and implemented the S.E.A.T. Management program, which changes the entire way that companies purchase and service hardware and software. S.E.A.T Management encompasses the complete management of information technology assets from hardware to software, on-site service to removal and updating of all equipment. In an age of outsourcing, KMCI proposes treating information technology products and services the same as a utility such as electricity, water, or cable television. S.E.A.T. Management eliminates the need for large capital expenditures and reduces the need for grand funding or new bond issues.
S.E.A.T Management provides:
- State-of-the-art information technology.
- Installation of products and services selected from KMCI’s program menu.
- Resolution of problems in a prompt, professional manner.
- One convenient monthly invoice for all products and services.
- Removal of all hardware at the end of the 36 month contract period.
- Following removal, a replacement of equipment and software with new items, according to the customer’s current information technology needs.
S.E.A.T. Management benefits the customer:
- The customer stays current with state-of-the-art technology and service.
- Eliminates technology maintenance tasks and reduces staffing requirements.
- Eliminates responsibility for information technology hardware removal and disposal.
- Eliminates the need for large up-front capital expenditures.
- Reduces the need for grant funding or proposal of new bond issues.
- Reduces the time and resources spent on costly bid processes.
- Eliminates Microsoft licensing issues.
- Offers accounting advantages in expense write-off versus depreciation of hardware.
- Allows technology products and services to become part of the customer’s recurring monthly expense budget.
- Offers a convenient single bill per month for information technology products and services.
KMCI is currently signing up dealers and customers at a 50% close rate on the first call.
DCH acquires businesses that produce, market, and service their own products. This eliminates the middleman, and allows us to keep our products priced competitively when compared to the competition.
KMCI owns a 100,000 square foot manufacturing facility (the plant), which is completely paid for. In addition, KMCI builds every product to customers’ specifications, and therefore, eliminates the need for hardware inventory (computer and servers) that are already built, and may or may not sell. KMCI continues to deliver every order on time (on or before the promised delivery date), while maintaining a 5% or lower failure rate on every product KMCI produces.
In order to hold costs down, we only order the specific supplies that we need to complete the orders that have been made and paid for. This eliminates the problem that our competition has, of having non-current technology (computer parts) sitting in a warehouse. The secret to our business is to provide the most current technology, combined with outstanding service on everything that we build and sell, and make it easy for our customers to purchase from us. In addition, for those customers that require “brand names” we are a value added reseller (VAR) for Perpetual Systems, IBM, Compaq, Hewlett-Packard, Lexmark, and Cisco, to name a few.
Service and installation is a major part of our business, and also one of the most profitable ones. KMCI has hardware, software, wiring, backbone infrastructure, maintenance, and consulting capability. This eliminates the customers’ frustration in dealing with multiple vendors.