Sato looks to extend retail business

Sato looks to extend retail business

Melbourne-based distributor, Sato Technology, wants to increase its number of branded retail stores to supplement its traditional wholesale business.

General manager, Lou Yuhang Liu, said it now had four stores in Queensland as well as two in South Australia and one in Melbourne. Branded under the PC Home banner, all were operated by existing Sato dealers that had opted into its franchise model.

In return for rebranding their stores, resellers received free marketing and advertising, as well as better buy prices, Liu said.

The distributor has also relocated its Queensland warehouse in the suburb of Mansfield.

"We were trying to find a location that was more suitable for the retail business," he said. "This model has been doing quite well in Queensland, so we decided to try to increase that business."

Sato announced in 2003 that it would establish a direct sales business in Queensland because it had been unable to get enough dealer support in the state. Not long after, it came under fire from resellers for advertising aggressively priced PCs and components to the public.

Despite saying PC Home stores had access to better prices, Liu insisted its existing resellers were still able to make sufficient margin.

"Some resellers were against us at the start," he said. "But we are maintaining two price levels: retail will run with the higher price, while resellers will have access to lower wholesale pricing so they can still make margins.

"For our imported products, we clearly differentiate these levels."

Because it was still trialling the concept, Liu said Sato had not formalised a target on the number of PC Home stores it planned to support.

However, he said it would be looking to expand the model not only in Queensland, but also in the South Australian market.

The distributor also worked with four stores in Sydney on the concept but had abandoned plans for now in favour of concentrating on the wholesale business, Liu said.

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