A Bet on the Cloud Pays off Big for Teknik Trading

Posted by Barney Beal, Content Director

Luis Alonso-Rincon, President at Teknik Trading Inc., attended a presentation about cloud-based software in 2005 and liked what he heard. The next day he had signed on as a customer.

“I remember sitting there and they were talking about the cloud. I didn’t know what that meant. It was so forward thinking and something I had never seen before,” Alonso-Rincon recalled. “I had used SAP for years. It didn’t take me more than 15 minutes to understand that the cloud was the way to go. I said to my GM, ‘this is the new software, we start tomorrow.’”

That bold, decisive thinking paid off for Alonso-Rincon both with his software and his business. Teknik Trading has grown from $5 million per year in revenue to $50 million after expanding from a freight forwarding business to countries in Latin America to a global procurement services business.

For one key customer, a large Venezuelan-based oil company, Teknik Trading it manages $150 million in procurement a year. It has 50 buyers purchasing products, issuing 11 reports a day. It’s managed with two people running NetSuite and Teknik Trading has been able to reduce the customer’s loss ration from about 11 percent to zero, a savings of almost $16 million.

“A big part of that is NetSuite,” Alonso-Rincon said. “The accuracy it provides us is incredible.”

At the same time, NetSuite (which had only recently changed its name from NetLedger when Alonso-Rincon signed on) has grown throughout Teknik’s parent organization. Teknik is one of 13 subsidiaries of Clover, the largest logistics company in Venezuela. Subsidiaries in Panama, Brazil and the Netherlands are now running NetSuite, reporting up to Clover where the organization still runs an SAP R/3 instance at headquarters, and more are converting to NetSuite.

Familiarity with SAP was one reason, Alonso-Rincon made the decision he did.

“NetSuite is like SAP for Dummies. It’s just very easy to use,” he said. “As long as I’m the international guy, I want NetSuite. I can see what’s going on in Panama, Rotterdam and China, without having to leave my Miami office.”

That’s an important capability for Teknik Trading, which sources products from all over the world. As Teknik Trading finds suppliers, it signs a contract with a local contractor or company and can give them access to the system.

“For me buying a good in the US or China it’s the same. Wherever they receive the goods, we know they’re on hand. I don’t have to have a server, I don’t have to have anything,” Alonso-Rincon said. “We have people in remote areas where they go out and do sales and close business and they’re somewhere in Chile. It’s very functional for us. There’s no need to open an office and we’re just as efficient.”

That’s approach and the automation provided by NetSuite allowed Teknik Trading to stay lean. As sales have multiplied 10 times, headcount has only gone up by 10 people.

A focus on lean, smart growth has helped Teknik Trading become the company it is today. For example, the company carefully monitors late deliveries by vendors and eliminates the ones that can’t deliver.

“It’s helped us improve the quality of vendors we have and eliminate vendors that don’t deliver,” Alonso-Rincon said. “Customer satisfaction has improved significantly.”

Now, Alonso-Rincon is hoping to bring the benefits to the Clover family of businesses. Siz subsidiaries have made the move and he hopes to have the rest up on NetSuite within two years.

“After 10 years, Teknik has grown faster than anyone else and become the standard,” he said. “In Teknik we do everything on NetSuite.”

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