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05 Jun 2006
Resellers have dismissed the potential threat to their businesses from Tesco, after the retail giant revealed plans to triple the range of laptops and PCs in its stores and double the number of stores selling certain IT products.
Tesco claimed the move was “the biggest shake-up in its range since it entered the [IT] market in 2000”. From mid-June, 50 Tesco stores will sell Acer Travelmate, Samsung X11, Iqon family PC package and Gateway GM5024B computers. The retailer will also sell printers and flat-screen monitors as separates.
Katie Jenkins, a Tesco representative, told CRN: “We will also soon start selling wireless networking, hard drives and memory sticks.”
Jenkins dismissed suggestions that the move could squeeze margins for VARs. “It means it will open out the IT market as a whole, as more and more people will look for software and other products,” she added.
Semmy Levitt, country manager UK at Acer, also denied the move would put increased pricing pressure on its channel.
“Tesco has become a retail channel for vendors now,” he said. “The traditional channel must still be given the same opportunities by vendors.
“Some end-users are buying products off the shelf, but others will want a different service, which is where the traditional channel comes in.”
Tony Price, managing director of online reseller WStore, was unconcerned by Tesco’s move.
“This move will mostly be competing with PC World, e-buyer and dabs.com,” he said. “It may have an impact on the small office/home office sector, but is not so big for business-to-business resellers.”
Stuart Fenton, managing director of Insight UK, agreed. “This will provide increased competition for retailers such as PC World, Dixons, Comet and Curry’s and bring lower pricing and a broader assortment of products to the consumer and small businesses with less than 25 users,” he said. “Dixons has previously controlled many aspects of this market.”
However, Hamish Thompson, a Dixons representative, said: “We have operated as the undisputed market leader in the electrical goods market for decades.
“With our retail outlets and online web sites backed up by our support teams, we feel we have what is needed to remain number one.”
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