SAP AG, the largest maker of business management software, said on Friday it plans to double its China workforce by the end of next year despite the gloomy economic outlook.
The plan is being driven by the company's rapid expansion in serving small and medium-sized enterprises in the world's second-largest economy.
"Chinese SMEs will be more eager than ever to rely on information technologies to reduce their transportation and operation costs, especially when the economic outlook goes bad," said Robert Enslin, president of sales and a member of SAP's global managing board. "And that is what SAP is good at."
Enslin added that SAP's recruitment may be faster than expectations amid the rapid growth of the company's China business.
In the first half of this year, SAP added about 1,000 employees to beef up its sales team in China. The move was a part of the company's four-year $2 billion investment plan in China, which was announced late last year.
The Walldorf, Germany-based company now has more than 3,500 employees in China.
SAP's revenues in China jumped by 30 percent year-on-year in the second quarter. The company expects its China revenue to hit 1 billion euros ($1.2 billion) "in the medium term", mainly boosted by demand from SMEs, Bloomberg News reported, citing Alexander Atzberger, senior vice-president of SAP and head of China strategy.
"The number of SMEs accounts for 79 percent of our total customers in China, and they helped to generate about half of the revenue," said Hera Siu, president of SAP China, without elaborating.
China's GDP growth slowed to 7.6 percent in the second quarter, the lowest quarterly expansion in three years. But the IT industry is growing faster than other sectors as the nation strives to lift its level of informatization.
"IT growth stagnated in Japan, where spending increased only in the software segment. By contrast, emerging markets, particularly in China and India, continued to record double-digit growth," said the company.
SAP is in a good position to enlarge its profit margin as the government encourages IT development throughout industries, a move that may boost demand for IT services, said Enslin.
In addition, the company is poised to conduct more cooperation and make more acquisitions deals to feed growing demand in emerging markets.
On Thursday, SAP signed an agreement with Huawei Technologies Co Ltd, the world's largest telecom equipment maker by sales, to jointly develop business-to-business IT service solutions and marketing.
"Teaming up with Huawei enables SAP to further explore emerging markets such as China, Africa and Latin America, where the Chinese telecom giant has established a sound service network," said Siu.
Another cooperation deal with China Telecom Co Ltd, which was announced on Friday, showed that SAP is striving to meet surging demand in emerging industries such as mobile Internet.
"We believe that adequate coverage is the key to success in China because of the size and structure of the country," said the company.
