CHS Electronics is to embark on a vendor cull over the next two months in an attempt to alleviate its cash problems.
The move comes in the wake of the distributor's second-quarter loss of almost $90m, and the announcement that it intends to look for strategic alternatives - effectively putting itself up for sale.
Peter Rigby, director of marketing and communications, told PC Dealer: "We have to look at our vendor line-up because we presently have more than we are happy with."
He said there would be "developments across the board" over the next 60 days, but added that particular focus would be given to the vendors it had gained through recent acquisitions, which include Karma and Metrologie - now renamed DNS.
"We have had time to look at them and see how they contribute to the business, and now we need to sort the wheat from the chaff," Rigby said.
Commenting on CHS's strategic options, Rigby said a full or a partial sale of the business or delisting from the stock market were possibilities.
A scaledown of CHS operations in Europe has already started, with the sale of DNS's Sun Microsystems distribution business to its management for $50m.
But Rigby insisted that the distributor was not panicking. "There's nothing to be gained from making rash decisions and we're not in panic mode. Our cost structure is the problem and we are taking measures to address this."
He added that the company was in negotiations to move all of its UK operations into a 60,000sqft facility in Slough.
Graeme Watt, managing director of Computer 2000, said: "CHS's biggest challenge is to hold on to its manufacturers' and creditors' confidence. It has to change from its current form and act quickly. Cutting down on vendors is a good way of focusing on short-term costs."
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