From the rise of drop-shipping to Whitman's Uber snub: Five things we've learned this month
Five key takeaways from the last four weeks in the channel
1. THE RISE OF DROP-SHIPPING IS SCULPTING MISCO'S APPROACH
Misco is to close its UK warehouse at the end of the year, saying the rise of drop-shipping has decimated its usage and made it too inefficient to keep running.
In an initiative designed to save a minimum of ￡1.5m annually, the reseller is outsourcing its warehouse functions to a third-party logistics provider. All 62 warehouse staff will be made redundant, Misco CEO Alan Cantwell told CRN.
Cantwell said Misco was left with little choice but to close the Scottish warehouse. "Like a lot of things in this business, this should have been challenged and looked at a long time ago," he said.
"We've taken a hard look at it. The logistics centre there was originally set up to ship 6,000 parcels a day, and at present we are shipping between 400 and 500 a day. Things have moved on. We are drop-shipping pretty much everything - the majority of parcels now go straight from logistics through to the clients, so we don't need that facility. It's a very expensive facility for the number of units that are going through it, and our 400 parcels a day will only go one way."
Some 105 UK staff have already left Misco under a recent sales and marketing restructure, while headcount at its Budapest shared service centre has also been shaved from 340 to 200.
2. WHITMAN HAD HER HEAD TURNED BY UBER
In July HPE boss Meg Whitman denied she would be moving to Uber, but as the ride-sharing firm confirmed former Expedia CEO Dara Khosrowshahi as its new chief, it was revealed Whitman was in the running at the end.
Whitman said Uber's board approached her again just prior to Khosrowshahi's appointment: "They [Uber] asked what it would take for me to change my mind," Whitman told the Financial Times.
This raised the question of Whitman's future at HPE, with Richard Holway, chairman of analyst TechMarketView, suggesting she might have a limited tenure: "It is hardly motivating to learn that your president/CEO is also contemplating jumping ship. Indeed, almost every article I have read now expects Whitman to be gone by the end of the year," he said.
3. JIGSAW24 MIGHT BE UP FOR SALE
Jigsaw24 will reportedly be sold, with the firm's owners already looking for potential suitors for the major Apple reseller. The Telegraph reported that private equity group NorthEdge Capital is seeking a buyer for the Nottingham-based firm which was ranked 34th in CRN's Top VARs rundown, with a 2016 turnover of ￡86.9m.
The report claimed NorthEdge Capital, which bought a majority stake in Jigsaw24 in 2013, has hired Clearwater Corporate Finance to approach buyers.
The Telegraph report concluded that a deal is expected to be announced at the end of this year or early next. Alex Tatham, managing director of Westcoast, told CRN: "If they [the owners] are selling, it must be for a very good reason."
4. RESELLERS CONTINUE TO WIN IN EDUCATION
Eleven resellers have been awarded a place on a higher education framework worth up to ￡440m. The National Desktop and Notebook Agreement (NDNA) has gone live, with resellers awarded spots as indirect partners for a host of PC vendors.
The four-year agreement will see the chosen 11 provide desktops and mobile devices from Acer, Fujitsu, HP Inc, Lenovo and Toshiba. Dell is also on the framework, but with no reseller partners, will take all its business direct.
The 11 resellers on the framework are: Academia, Bechtle, CDW, DTP, European Electronique, Getech, Insight, Misco, SCC, Stone and XMA. Stone Computers will also supply its own devices direct to customers, while XMA will supply its Viglen brand. Acer, Fujitsu, Lenovo and Toshiba will not sell their products direct.
5. TECH DATA NOT HITTING MARK YET
Tech Data's shares crashed after its Q2 results disappointed Wall Street and it complained of missing vendor rebate targets. A "significant piece" of the shortfall was generated by the distributor missing its vendor rebate targets, CEO Robert Dutkowsky revealed on a Q2 earnings call.
Although stopping short of naming names, Dutkowsky clearly fingered Avnet TS' biggest vendors when he said the problem lies mainly with "a few very large vendors"… "and these are not vendors we have had a long history of managing at the volume and scale and scope that we had to manage through this quarter".
During Q2, only Apple (12 per cent), HP Inc (11 per cent) and Cisco (11 per cent) generated over 10 per cent of Tech Data's sales, but it inherited a big relationship with IBM through the Avnet union.