| | Resource Stocks Advisory & Struther's Future Tech Report
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Investment Opportunities & Strategies in the Markets for Tomorrow
SmartSales SA on CDNX 52 week trading range $0.07 to $0.80
Recent Price $0.20 I would buy at current prices
Shares out 16.5 million
Fully Diluted 24.5 million
Management - approx. 55% fully diluted
Smart Sales is a software company that is just moving from its incubation stage into strong revenue growth stage. The company has been around for about 5 1/2 years and is located in Toronto Ontario. SA is in the same office building and has strong support from an established software company called DataMirror Corp., DMC on Toronto ($23Cdn). Nigel Stokes, CEO of Data Mirror has a significant interest and ownership in Smart Sales. The support from DatMirror is obvious with news on Oct 31st that SmartSales obtained the right to distribute DataMirror iDeliver software as a key component of its new InSmart Product Suite to enable seamless integration of customer data stored in BackOffice or legacy systems.
SmartSales' InSmart software can use DataMirror's iDeliver data integration technology to empower users with real-time information such as inventory levels, delivery schedules and customer status that would otherwise be difficult to access. DataMirror's iDeliver software components ensure that data from BackOffice and legacy systems can be delivered directly to users within the SmartSales OutSmart CRM application.
SmartSales products are specifically designed to enhance the efficiency and effectiveness of the sales cycle for both sales representatives and corporate managers. They have a niche product that can be used by any company that sells material or service, the focus is on the Contact Manager with Outlook (Microsoft). There are approx. 65 million desktops using Outlook. Customer Relationship Management (CRM) applications are expensive and take a long time to implement. SAs product is easy to learn, so this is advantageous with sales people under time constraints.
Product
This will give you a little more idea what SmartSales software does
SmartSales Central allows any number of people within an organization to work remotely with SmartSales - at home, on the road, or at branch offices - without being connected to head office.
SmartSales Partner brings together and distributes important salesforce information to third party resellers, distributors and vendors.
SmartSales RealTime, which installs on a Windows NT server, allows a head office to gather the latest sales and marketing information from any number of field representatives and merge them into a corporate SmartSales database.
SmartSales Opportunity Generator automatically loads leads from a text data source and creates new opportunities in your SmartSales database.
SmartSales Territory Assignment automates assigning opportunities to your sales force. Define your sales territories and let Territory Assignment distribute the opportunities to your entire sales force. Leads get in the hands of your salespeople immediately.
Customers using Smartsales include Toshiba Canada, DeVries Data Systems Inc., Citibankâs Business and Professional Banking Division, Red Brick Systems, Los Gatos, CA Digital Equipment of Canada, Ltd., Symantec Corporation, Cupertino, CA. SmartSales is actively marketing their software to numerous large clients and recently issued a news release in early November on progress.
Companies such as DataCore Software Corporation and LifeSkills International Inc. have already deployed OutSmart and are realizing its benefits and value in helping increase their sales organizations efficiency, satisfaction and return on investment.
"We are thrilled at the response from our customers," said Don Parker, president and chief executive officer at SmartSales Inc. "The reaction from our customers is verifying what we have always believed OutSmart does for companies with its product attributes and the value it brings to our customers."
"We're in one of the fastest growing segments in technology and response to our product offering has been overwhelming," said Nyron Ramsingh, IT manager with Florida-based DataCore Software Corporation, whose innovative storage domain server software helps companies manage the exponential growth in data storage. "By implementing SmartSales' OutSmart solution, we have streamlined the management of all opportunities so we can make the most of each opportunity worldwide."
According to Stephen Murgatroyd, president for LifeSkills, a U.K.-based, wholly owned subsidiary of Axia NetMedia Inc.: "We are already realizing the benefits of OutSmart as it leverages our existing IT environment. Our consultants enjoy using it and are very satisfied with the product and the service. It has made all our stakeholders very happy and OutSmart allows us to provide superior service to our customers. We hope to use this to our competitive advantage within our IP applications environment."
Many OutSmart users have quickly realized the benefits to their business of implementing the SmartSales CRM solution. For example, a financial services company required a solution that would minimize downtime from implementation and training. OutSmart was operational in its environment and used by its sales force within a week. An IP telephony services company was able to better manage its sales force and be more productive servicing and adding value to customer experiences with the rapid implementation of OutSmart.
"Hearing our customers rave about the product and how valuable it has been in their organizations is really what SmartSales is about," said Don Parker, chief executive officer and president of SmartSales Inc. "We provide CRM solutions that add value to organizations and help increase their efficiency almost immediately upon implementation. We are honoured to be working with these companies and as their marketplace, business requirements and demands change, we will continue to renovate and innovate our products in order to meet their needs."
Finance
SmartSales had record results for the third quarter. Revenues increased to $185,182 for the third quarter of 2000 from $59,162 in the same period in 1999. This represents an increase in revenue of 213% year over year and an increase in revenue of 105% over the second quarter of 2000. The net loss for the third quarter was $383,989 or two cents per share compared with a loss of $243,163 or two cents per share for the same period last year.
Summary
SmartSales market place, CRM is huge. U.S. heavyweight Siebel Systems Inc. dominates the CRM market with total sales expected to top US$1-billion this year. A host of smaller firms with sales of less than US$100-million are nipping away at the heels of the industry giant. Janna Systems Inc. 'JAN' on the TSE was a recent company to move into this market and its stock price soared from $0.90 in 1999 to a high of $41, of course this was in a much hotter market, but never the less, the potential for SmartSales is huge.
SmartSales is very cheap with a market cap of approx. 8 million. I expect they will achieve revenues of $2 to $3 million over the next year as they roll out their product. The longer term goal of the company is annual sales of $20 to $30 million and I see no reason why this cannot be attained. The people and company (DataMirror) behind SmartSales really increase the odds of their success.
Software companies normally have very high profit margins and once your product is out there, upgrades and related software products can provide a continued revenue stream. I have not put the software to practical use, but from what I have seen, it looks very good. This is also confirmed by the list of clients that have already purchased the software. SmartSales has expanded their sales force, has DataMirror behind them and is very actively marketing to some large customers, a few sales agreements here will quickly multiply existing revenue numbers and the stock price should start to respond.
The stock is an excellent bargain around $0.20 and you should be able to accumulate at these prices during the current market weakness and tax loss selling. I believe that 2 to 3 years down the road we could be look at a stock price in dollars instead of pennies. |
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