Westcoast calms fears stirred up by Orion buy

Westcoast has been quick to reassure its resellers that it will not follow up on its acquisition of consumables distributor Orion Media Marketing by establishing a direct-selling hardware division.

The privately owned distributor last week acquired Orion, which has a direct-sales arm, for an undisclosed sum, and announced that the firm will operate as a trading division of Westcoast.

Andy Dow, commercial director at Westcoast, said: “Orion is the second largest Hewlett-Packard [HP] consumables distributor in the UK and Westcoast is the third, so the combination of the two gives us a tremendous opportunity.”

As well as HP, Orion also distributes Epson, Lexmark, Canon and Imation, among others.

The two companies combined will form a distributor that turns over more than £500m. “We haven’t had much overlap except for two contracts, which means that all the other vendors have been incremental to us,” said Dow.

Dow added that Westcoast intends to keep Orion’s three distribution divisions – trade, corporate and retail – functioning for the time being. “Integration will happen, but we are not in a position to say when,” he said.

Paul Musgrove, managing director of VAR PS Office Supplies, welcomed the acquisition, but expressed caution about Orion’s direct sales.

“Strategically, this is a good merger which will give us access to a wider range of consumables.

“But our concern is that Orion does have a direct salesforce. It would be good to know that Westcoast does not intend to extend this to selling hardware,” he said.

Dow said there was no cause for alarm. “At the moment Orion’s direct arm is for supplies only and it looks after the corporate and government sectors. It is a world away from hardware. We have no intention at all to change that at this time. Our core value is trade distribution, so there is no need for concern,” he said.

Paul Barlow, managing director of Equanet, said: “This is quite a clever move, as there is good margin in consumables. It will see Westcoast strengthen its position further.”