Profile: ScanSource, Inc. (SCSC.O)

ScanSource, Inc., incorporated in December 1992, is a wholesale distributor of specialty technology products, providing distribution sales to resellers in the specialty technology markets. The Company operates in two segments: North American distribution and international distribution. The North American distribution segment markets automatic identification and data capture (AIDC) and point-of-sale (POS) products through its ScanSource POS and Barcoding sales unit; voice, data and converged communications equipment through its Catalyst Telecom sales unit; video conferencing, telephony, and communications products through its ScanSource Communications unit, and electronic security products and wireless infrastructure products through its ScanSource Security Distribution unit. The international distribution segment markets AIDC and POS products through its ScanSource Latin American and European sales units, while communication products are marketed through its ScanSource Communications sales unit in Europe.

North American Distribution Segment

The ScanSource POS and Barcoding sales unit markets AIDC and POS products, which interface with computer systems used to automate the collection, processing and communication of information for commercial and industrial applications, including retail sales, distribution, shipping, inventory control, materials handling and warehouse management. The bar code family of products is referred to as AIDC because it includes all types of portable data collection terminals, wireless products and bar code label printers, in addition to scanners. POS products are those personal computer (PC)-based products that have replaced electronic cash registers in retail and hospitality environments and the peripheral products that attach to them. These peripheral devices include such items as cash drawers, pole displays, signature capture units, display monitors and magnetic strip readers. ScanSource POS and Barcoding also sell products that attach to the POS network in the store, including kiosks, network access points, routers and digital signage displays.

The Catalyst Telecom sales unit markets voice, data and converged communication systems and is a distributor of Avaya communications solutions, including Avaya Global Communication Solutions (GCS), Small Market Business Solutions (SMBS) and Internet protocol (IP) products. Catalyst Telecom also markets products complementary to the Avaya product line from vendors, including Extreme Networks, Juniper Networks, Plantronics, Polycom and multiple wireless vendors.

ScanSource Communications is a distributor of total communications solutions, including video and audio conferencing products; telephony solutions, including voice-over IP (VoIP), and computer telephony building blocks. ScanSource Communications’ manufacturing partners include Polycom, Audiocodes, Plantronics and Quintum.

The ScanSource Security Distribution sales unit focuses on hardware distribution of electronic security equipment using the two-tier distribution model. The product offering includes identification, access control, video surveillance, intrusion-related and wireless infrastructure products. Manufacturers include Alvarion, Axis, Cisco Security, Datacard, Digiop, DSC, Fargo, GE Security, HID, Motorola Wireless, Panasonic, Sony, Tropos and Zebra Card.

International Distribution Segment

The Company’s international distribution segment markets AIDC, POS and communications products exclusively to technology resellers and integrators in the Latin American (including Mexico) and European markets. Vendors include many of the same vendors that supply the ScanSource POS and Barcoding and ScanSource Communications sales units of the North American distribution segment. Other vendors include Siemens Communications, Shortel, Star Micronics and Mitel.

The Company competes with Avnet, Ingram Micro, Synnex, Tech Data, Bluestar, Jenne, Voda One, Nimans, Westcon, ADI, Anixter, Northern Video Systems and Tri-Ed.