Computer 2000’s UK managing director Andy Gass has urged vendors to set realistic rebate and inventory targets, and to invest in distributors that are geared for growth but not saddled with debt.He made the comments at this year’s C2000 Vendor Partner Summit and warned that the credit crunch could have far reaching ramifications for the industry.
“The theme of the moment is that it’s bloody damn tough out there,” said Gass. “The shock that we’ve seen in the financial markets says that almost anything could happen.”
The credit-based nature of distribution means that the lowered availability of credit can easily play havoc with the industry and shrinking margins warn of a need for consolidation.
“A 20 per cent drop in the market next year and the resulting 0.5 per cent fall in vendor margins could spell disaster as the whole of UK distribution would make no money,” said Gass. “Distribution is already challenged as profitability was already under pressure.
“There will inevitably be consolidation through mergers, vendors choosing to work with fewer partners and some going out of business.”
Source: MicroScope
Advertisement
Related Stories
- Realtime signs up for PCR Retail Boot Camp Feb 9th 2012 at 11:14AM
- Distree 2012: A report from the ground Feb 8th 2012 at 5:34PM
- Samsung to launch Galaxy Nexus White Feb 7th 2012 at 10:08AM
- Microsoft UK pricing could rise Feb 3rd 2012 at 12:06PM
- Sennheiser partners with Midwich Jan 26th 2012 at 11:36AM
- Widget appointed Gemini Devices distributor Jan 26th 2012 at 11:32AM
- Interactive Ideas signs Bitdefender deal Jan 26th 2012 at 11:23AM
- Shepherd to head up VIP's new retail sales team Jan 10th 2012 at 12:31PM
- Gem to acquire Ztorm Jan 6th 2012 at 1:27PM
- Best Buy to leave UK this month Jan 5th 2012 at 4:08PM
Follow Follow this article if you would like to receive notifications of updates.
Add a new comment
You need to be logged in to post comments. If you do not have an account then please register.
Comments
0 comments
There are no comments yet, be the first to add one!