Distributor Ingram Micro will consolidate its warehouse, call centre and administration functions into one new Sydney premises, reducing the Melbourne operation drastically in the process.
Steve Rust, managing director of Ingram Micro Australia, was keen to put a positive spin on the changes, which will see less than a dozen of the current 60-strong Melbourne staff retained. The remaining staff in Melbourne will mostly be sales-based business development managers.
Head office operations such as vendor-facing product management and customer-facing sales management are currently split between the two cities and will now be integrated, Rust said. He claimed the move was not merely a cost-cutting measure and said that all affected Melbourne personnel will be offered positions in the bolstered Sydney operation.
"We are definitely keen to keep our people with us," Rust said. "We are just gearing ourselves up for the growth we have been having and that we are expecting to have over the next few years.
"We have taken a large new facility in Flemington [Sydney], which will cater to a doubling of our business. We have mapped out what we think our growth will be in the next five years and have taken a five-year lease, which will give us the room to accommodate that."
Rust said "satellite distribution centres" will be located in Melbourne and Perth where fast-moving items, mainly components, will be held for "will-call" customers who require items on a same-day basis. A third satellite distribution centre is scheduled for opening in Brisbane this year while a sales-only presence will be developed in Canberra for the first time.
Consolidation plans, including the relocation to bigger premises in Flemington, will be completed by January next year. Four-year leases on current premises in Sydney, Melbourne and Perth expire in March 2003.
Rust said the move is in response to recommendations from paid consultants who were looking at ways to create a more efficient and effective operation in light of current market challenges. "We have been thinking about the longer-term requirements of doing business in Australia and how we should best be organised to achieve growth and profit objectives here."
Rust claimed Ingram Micro's 2002 sales are up 23 per cent on the January to August results for 2001 and that all profit objectives for the year have been achieved.
"Some months have been better than others but we have met our revenue and profit targets for the last three months in a row [June, July and August]."