Shortly after GPS and software providers Everyday Solutions and Synovia merged in September to form Synovia Solutions, we sat down with the new company’s president and CEO, Jon King, to discuss how the deal went down and what it all means to existing and new customers and the industry as a whole.
King said the merger focuses on melding strategy, functionality of software, market size and market share to take advantage of "best of breed" solutions previously offered by both companies. He also said that, increasingly, school districts are seeking solutions for not only student ridership and fuel savings but also efficiencies for tracking driver time and attendance payroll are becoming.
School Transportation News: What was the impetus for the merger?
Jon King: Number one, we have been on parallel paths for, obviously, 10 or 11 years in the same space selling 95 percent of our solutions to the K-12 market. The CEO of that company and myself started chatting informally in December (2011) about the synergy and the pluses versus the minuses of bringing the two companies together in a merger. We reached the conclusion that: a) the integrated technology that Everyday brought to the table and the software and the technology that we brought to the table that integrated together in a brand new, what I’ll call, “technology roadmap” would make us more formidable in the market. It was a technology best-of-breed software integration that would make us a stronger company. Number two, as a combined entity we would double our market share. We would be, we think, a more viable tool for school districts in the market. Three, by doubling our market size, we could look at additional opportunities for school districts that were Everyday’s customers that could benefit from some of our solutions, and vice versa, so it would provide us with an opportunity to provide incremental solutions and revenue as a result of that to a wider market. I think, finally, any time you bring two companies together you hopefully do it in such a way that there are efficiencies and process gains. Some companies do that integration well. Others do not. We would like to think we are going to do that well. We both, independently, were functioning with the same financial software to run our companies, so integrating that is easier and better and easier.
STN: What does this merger mean to current customers of both companies? Is it business as usual?
King: We literally called every current customer and talked to them live in addition to sending them an email and letter, as well as, obviously, they could have seen the press release. I can tell you for the group of customers that I called, which was our largest, they were very excited about what they viewed as additional value that they could receive. The second piece of the equation, if you just stay in the school bus space and don’t venture out to other areas of the public sector, there is a quarter of million of school buses in the United States that don’t have (GPS), our product or our competitors'. So, to the degree you can get there with a more powerful solution, and you can get there quicker, it presents a tremendous opportunity for us and those prospects to become customers, and the growth of the company can be material.
STN: GPS growth, as Synovia Solutions is forecasting, even with budget concerns nationwide, do you see school districts making due and purchasing?
King: The short answer is, if you pursued (sales) the same way we each had done in the past, and that was to go to a school district and talk to them about the application of tracking and comparing it to their routing software so they could better manage their fleet of vehicles. And you went to them and asked, ‘What do you think?’ And they said, ‘We embrace it, we like it, but our budgets are tight.’ And you still had to operate out of the capital budget acquisition model, it would be tough. If, however, you could go to that same school district and say to them, 'Look, we will provide to you the hardware, the software, the training the whole thing for x number of dollars, and the cell coverage to transmit the data, for x number of dollars per school bus so that for your acquisition costs you don’t have to appropriate any capital up front. You could do it on a more of a monthly model. Does that change the way you look at things? And by the way, if you do it that way, that approach can almost be self-funding, if some of the ways you can save money for school bus are materialized?'
The answer is a resounding absolutely. So we’ve not only changed the size of the company, and the technology will go to market and the size of the of the organization will go to market with our solutions but the way in which the customer or the school district can acquire it.
STN: What can you say about trends in the GPS reporting space, especially with regard to key performance indicators, student tracking and maintenance?
King: I think there is much more interest by school districts relative to safety and management of student ridership. Understanding what kids got on the bus, what kids got off the bus and keeping track of the students for the benefit of the parents. That has becoming much more talked about. Pick a number: two years ago, while it was certainly there, it was not as prevalent of a discussion topic as today. Second, there is a lot more emphasis, and I think you’ll see a lot more focus, on the savings aspect because of tight budgets. There are two ways a school district using our software can accommodate that. One is, can you save fuel? Number two, can you more effectively, fairly and accurately pay the employee who is driving the school bus. If you can integrate your payroll system with the bus driver or bus drivers so that you pay them fairly but you only pay them for the hours worked and take the manual, tedious payroll entry out and integrate it immediately with payroll, the savings can be material.
STN: Anything you’d like to add?
King:I think you’ll see us take a more positive and aggressive approach to the white fleets, those vehicles that are a part of a school district that are not yellow in color, but are vehicles that have to be managed, tracked, accounted for, etc. That’s more important, and you’ll see us have a bigger presence there, and I think you’re going to hopefully see the brand of Synovia Solutions become more prevalent in the whole fleet management business.
STN: Thank you.