Sub-distributor Gamma Global has gone out of business after 26 years after encoutering cashflow issues, having alluded to a "challenging year" in recently filed annual accounts.
The Mancunian broker – which had been striving to reinvent itself as an authorised distributor – confirmed on its website that it entered administration yesterday. All 30 staff have been made redundant, bar one employee who is assisting with the administration process.
Begbies Traynor has been appointed as administrators of the firm, which specialised in hardware brokerage.
"Recent losses gave rise to cashflow difficulties which led to the directors seeking the protection of an administration order," Begbies said in a statement to CRN.
"The administrators are open to considering offers from potential purchasers, who should contact Gareth Prince or Carole Mulloy at Begbies Traynor on 0121 200 8150."
Gamma’s last annual accounts, for the year ending 31 December 2013, paint a picture of a company scrambling to adjust to a world in which the in-house enterprise infrastructure it sold had become less relevant.
Losses for the year hit £150,000 on revenues that dropped 14 per cent to £37.2m.
"2013 has been an extremely challenging year for the business, resulting in some short-term losses of revenues and profits," Gamma said in its accounts, which were filed in September.
Gamma - which had offices in Manchester and Birmingham - also admitted it faced increased credit exposure due to "tightening credit lines" among credit insurers.
Sources CRN spoke to said firms operating in the broker market have not been helped by the influx of counterfeit kit from China.
Founded in 1989, Gamma’s sub-distribution activities focused on providing dealers with an equivalent level of services to authorised distributors around vendors such as IBM, Cisco and APC, but at a lower cost.
The switch from in-house datacentre to outsourced cloud services “accelerated way ahead of our forecasts”, Gamma admitted in its accounts.
This created a requirement to shift its portfolio from being focused on infrastructure to communications and networking, it said, a factor that was behind its plunge into the red.
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