VI Group Plc, the CAD/CAM software company which floated earlier this year, has made a significant breakthrough in the US market after signing an exclusive distributor agreement with Trans Global Services Inc for clients in the automotive and aerospace industry. VI, which was spun out of the Olivetti empire, has built a modest business with revenues of 3.9m pounds last year. It has built up a following with 4,000 design and manufacturing companies, with an inexpensive product that appeals to small and medium-sized organizations. It says its big advantage is an ability to run on Windows-based PCs while many of the competition are still moving over from Unix platforms. Under terms of the deal with TGSI, the US company has agreed to sell software worth at least $5.2m over the next three years to keep exclusive distribution rights. Apart from acting as a value added reseller, TGSI will use VI software in its ‘virtual office’ concept, where it will offer design outsourcing services to aerospace and automotive companies. Despite its puny revenues, VI is aiming at a mechanical sector of the CAD/Cam market which analysts Dataquest estimated to be worth 3.6bn last year. The market is also highly fragmented with no dominant vendor and VI believes that its focus on the medium-sized user will enable it to benefit from the trend among big companies to outsource design operations.
