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Mass merchants move in on software sales

Mass merchants move in on software sales

In what has been described as "the year of the mass merchant" in computer retailing, Electronic Boutique and Officeworks have been the star performers according to a leading software distribution sales executive.

Terry Sullivan, general manager, sales, at software and peripherals distributor Dataflow Computer Services told ARN Daily yesterday there is an increasing number of large retail organisations on its books and they are selling a lot more product than in the past.

"The whole market is growing, but I believe the mass merchants are growing at a far faster rate than the little guys," he said. "I have definitely noticed a shift in our sales towards the centrally-ordering, multi-outlet, mass merchant retailers and it is more apparent at Christmas than any other time."

Sullivan said major retail players such as Target, K-Mart, Big-W, Myer and Grace Bros. are all growing dramatically in both their range of product and in the sales being generated, but he nominated Electronic Boutique and Officeworks as the biggest movers.

"The reason those two have been so strong is simple - they have the best systems in place in terms of managing their inventories, forecasting demand and maintaining efficient methodologies," Sullivan said.

"In my opinion they are the two to watch in retailing."

Indicating Dataflow's sales were be up 40 per cent over last year's Christmas period, Sullivan put this down to the increased number of entertainment and educational titles it is distributing. He said two of the new products Dataflow has been distributing in the lead-up to Christmas have been big sellers - Sierra's new PC-based hit, Half Life ($89.95) and the N64 title Buck Bumble ($99.95) from Ubisoft.

"We sold over 10,000 copies of Buck Bumble on day one and about 7,000 of those were to either Big-W, Target or K-Mart. The mass merchants have a dominance when it comes to console titles," Sullivan said.

"However, the best performer has been Half Life. In the four-week lead-up to Christmas, we will have shipped 20-25,000 copies of it, which is pretty impressive for a PC-game these days. That is across a much broader range of resellers than Buck Bumble, though."

Interestingly, Sullivan pointed out the non-traditional computer retailers selling large volumes of console games are also starting to place big orders for the PC-based games.

"The whole computer software and hardware market has become increasingly commoditised and people are now prepared to just pick their software off the shelf without the help of a salesperson," Sullivan added.

Sullivan also pointed out the other pattern emerging in Dataflow's channel has been the increasing willingness of resellers to deal with it over the Internet. He indicated the overwhelmingly positive response to its expanded Web services has encouraged even further development of that medium in 1999.

"While there is not a lot of our customers having huge success with sales over the Net, they are extremely interested in receiving their information and communication via the Web," Sullivan said.


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