Intel has pulled a surprise by appointing the locally-grown Todaytech Wholesale as the third distributor of its motherboards and processors.
The Todaytech Group has grown from a single retail location in 1990 to turning over more than $100 million a year. It has offices in every state, including regional offices in Newcastle and Townsville, as well as distribution operations in China, Singapore, Hong Kong, Japan and Taiwan.
The Intel appointment is a coup for the company, but as Todaytech founder and CEO Jack Zhong was speaking to ARN, he gave the impression it is just one more part of the plan unfolding. "As a distributor, we are focused on meeting both Intel's requirements and those of our customers. Todaytech has a very good understanding of the needs of its customers."
It should, too. To grow a new business to the size and level of sophistication that Todaytech is, you need to know a few things about selling computers.
The company has restructured its business model to appear both as a distributor and reseller. The system integrator cum solution provider has traded under the name of Todaytech Computers and the Moebius System brand, while Todaytech Wholesale has been developing the distribution business since 1995.
To help distinguish the system supplier, Todaytech Computers will now trade as Moebius System, and Zhong claims it will get no preferential treatment from his distribution arm. In fact, he said the success of Todaytech Wholesale demands maintaining a distance between it and Moebius.
As a distributor, Todaytech took the Fujitsu brand hard disk drives to a position of prominence in the Australian market, while its other brands include Canon, Mitsubishi, NEC and Sony. The appointment by Intel will have blind-sided many industry observers, but the big chip maker clearly knows what it has in its hands with its newest distributor.
Intel has taken the opportunity to look very closely at its options for the distribution channel. The way Intel national sales manager Archie Wilson puts it: "We wanted more downstream reach, and Todaytech will be able to reach more of the very small resellers."
Todaytech won't get it all its own way though. Synnex managing director Frank Sheu expects that, because of the association with Moebius, it will have difficulty establishing itself with other major GIDs (genuine Intel dealers). While welcoming the appointment, he expects the competition for Intel product to be healthy. Tech Pacific's David Cullen made no comment.
Zhong expects to increase his business by a whopping 50 per cent or more in the next year. That would put the value of the Intel business at more than $50 million.