Which B2B AIM firm's customers should I research?

Monday, Dec 18 2017 by
6

It dawned on me a while ago that investors have no real idea as to the true relationship firms they invest in have with customers.

Why did customers buy? Who else did they consider or also buy. What's the likelihood they will continue to buy/buy more/stop buying. 

For instance, take IQE (LON:IQE) ( I don't hold). I read recently that one of their customers decided to buy from another vendor when I was led to believe that IQE's Epitaxial wafer product was unique. Wouldn't it be good to know what that customer really thinks of IQE rather than simply believe what IQE wants us to believe? 

If it was possible to understand this, we as investors would have a better understanding as to what was driving the numbers today and how much to believe the forecasts. 

So, I'm considering researching one AIM firm to test this out. My initial criteria would be:

  • B2B
  • Growth agenda
  • Less than 100 customers

With this in mind, which firms should I consider? Please let me know in the comments below. And if you like this idea, please give this post a thumbs up. 


Francis

PS: I'd like to do Image Scan Holdings (LON:IGE) only because I have a long position that is deep underwater and I want to know whether they're worth the pain!



Filed Under: Growth Investing, Interviews,

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2 Posts on this Thread show/hide all

daveinthelakes 18th Dec '17 1 of 2

Good idea if you can sort it but most companies do not produce a list of all their customers and the percentage each contributes? If you do find this info not sure the customers will answer your questions!

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Graham Ford 18th Dec '17 2 of 2

“For instance, take IQE (LON:IQE) ( I don't hold). I read recently that one of their customers decided to buy from another vendor when I was led to believe that IQE's Epitaxial wafer product was unique. Wouldn't it be good to know what that customer really thinks of IQE rather than simply believe what IQE wants us to believe?“

Francis, IQE are unlikely to disclose who their customers are in any detail as a lot of their supply is covered by non disclosure agreements with their customers. The Apple supply chain is well known for having to say ‘no comment’. Who is this customer that has supposedly gone elsewhere? If it is just a rumour then it’s unlikely anyone is going to give you a comment.

In general B2B do not discuss customer supplier relationships very openly. Occasionally a general market research survey is done where a customer may give their anonymous opinion about suppliers but I think it highly unlikely you can get anyone to make a useful comment to you that can be attributed to them.

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