Dale Foster: No. Yeah, we’re not on track with the DataSolutions team. And just to add to that, Howard, we integrated the sales teams early January for DataSolutions, and some of their, you know, managers are running now our Climb UK teams. So that team is pretty integrated. That’s step one. The next part of the integration is upcoming. It’ll be in line with our ERP that’s going to roll out in July, August timeframe. And we believe by the end of this year, we’ll have – every company, we have a lot of them on our systems right now, but everything we’ve acquired in the last two years will all be under one. And Drew is running the project, but the focus is by the end of Q3 so that we have a true Q4 on one ERP for reporting. And you can imagine from three different disparate systems trying to pull those all together. It’s not like we’re special. Every company goes through it, but we want to get through it in Q3.
Howard Root: Well, good luck with that one. We all know how hard that is to pull off, but it has to be done. Second question. I’ve always modeled it, keeping it simple, like 5%, gross profit 5% of adjusted gross billings, then SG&A below 3%, so net income is above 2%. And this quarter I think somewhat because of the acquisition and cost there. You’re 4.8% on gross profit, 3.5% on SG&A, so net income is down at 0.8%. Are those realistic targets for the business, the 5%, 3%, 2% [ph] Or how do you look at that? Or am I off on my assessment of what the numbers should be?
Dale Foster: Yeah, I think your first modeling is more accurate. Like we said, we had low soft in Q1 on some of the margin profile, some of our bigger vendors, but we don’t see that. We don’t see the trend. And we know as these vendors get bigger, it’s the larger the vendor. There’s two parts that happen. They expect there’s less work to be done in the channel, so they try to reduce the margin profile not only to us, but also our reseller partners. But on the other flip side of that, as a distributor and reseller partner, as they grow and it gets wider of their business, we’re more efficient at actually transacting it. So we save the dollars on that. So it kind of goes for one for one. But that’s a pretty good way to look at it.
And if you look over the last couple of years, we have enough emerging vendors coming in that have a higher margin profile than that to make up for these larger ones. And I can just tell you it’s nonstop. We talked about evaluating 42. There’s probably another 10 or 15 that we talked to that we are just – don’t even get off to the next phase because they’re just not ready even to have a channel talk yet. So if it wasn’t for that robust vendors just coming out of the startup phase, I would say, okay, it’s going to slow down a little bit. We don’t see that at all.
Howard Root: Okay, great. And then just more general. And I always like to do this kind of pulling it up to 30,000 feet. Dale, how do you see the sales environment and trajectory, in particular the economy and interest rates? Does any of the macro effects going on worldwide affect you and your business in any way? And how would you see that going forward the next year, 18 months?
Dale Foster: Yeah, I’m not that smart, Howard. So on the macro side, we look at it and we’re like, it has to have some kind of impact on us. But here’s what I would say is, we are so small in our market space with our peers, right? If you take a look at the big three distributors, they’re all $40 billion plus. They do a lot more hardware than we do. We are software, software. So we compete with divisions inside of each of those big guys. What we’re seeing though, is the larger they get in some of their vendors, because if you look at their top 10 vendors are bringing in 90% of their revenues. As soon as you get down the Line Card, those vendors are not getting the care and targeted approach that we provide. So we’re seeing share shift from our competitors to us in a pretty big way.
If I look at just the ones we talked about that we won awards for, if you take a look at those vendors, the share shift that they’re pushing to us because they’re just getting a much higher touch white glove service to sell their products out to the market. So on the positive side, our teams are really taking advantage of that, but we don’t see the effect because we’re looking at a much smaller target audience. We’re not selling to 30,000 resellers, we’re selling to 7000 globally, where our competitors are doing that. So it’s – we just don’t see it as much. And we think we can – we have a lot of levers we can pull. We have a great balance sheet. So we will just go and say, hey, this is where we’re going to target. Now, we can move very quickly and put a sales team like we have on a specific vendor and capture a bunch of their business and then do the same thing.
So it’s much more of a tactical approach there.
Howard Root: Okay, great. So the good news is the economy doesn’t really affect you. The bad news is it’s all on you. So success and failure is on your execution.
