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Retailers face unfamiliar threat

Retailers face unfamiliar threat

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If retailers thought competition only looms large from the next mall, the local Harvey Norman superstore or the Internet, they better think again.

In the future, it is just as likely to come from the convenience store next door.

In the search for new markets, distributors are taking huge strides in the race to take a large variety of computer hardware, software, consumables and accessories out of their computer store-centricity and into the mainstream.

What started as simply a couple of hardware stores selling home improvement software, service stations selling computer games and bookstores introducing computer titles, is threatening to become a tide of cross marketing as traditional demarcation lines blur.

Last week, global consumables giant Daisytek began rolling out its "JumpStart" retail merchandising promotion in Australia. JumpStart will potentially take the most popular inkjet cartridges and diskettes to thousands of mainstream and convenience retail outlets.

Daisytek's retail channel manager, Tim Ingham, said the type of stores being targeted include "newsagents, service stations, pharmacies, mixed merchandisers and photography outlets" amongst others.

These are all regular destinations for "the home computer user, the student and the SOHO professional", he said. "They are the major drivers of the consumables market's growth."

Mainstream distributors are also expanding the array of outlets they deal with. Local tall poppy Tech Pacific plans its own consumables assault but sees much more opportunity in the future.

"Not many of our vendors are not expecting us to find them new markets in non-traditional retail channels," Fiona Stewart, marketing communications manager at Tech Pacific, said.

"We are always looking for new avenues. Every distributor is. That is the role of a distributor in its relationships with vendors and we are not going to be left behind," she said.

Stewart said Tech Pacific is setting itself up to have more contact with new retail partners. Its Dropship third-party fulfilment service is heading in that direction and means that all sorts of businesses will be able to offer the products and services it distributes.

Games are an obvious attraction for a variety of retail outlets, according to James Ellingford, SE Asia operations manager for games distributor Jack Of All Games (JOAG).

It already has product in video stores and is targeting lots of other outlets.

"We see service stations, convenience stores and supermarkets as obvious future outlets for the games and accessories we sell," Ellingford said.

"At this stage it is discount product and low-cost software relying on the impulse buy that is working well at these outlets but moving down the track I see a lot more product on the supermarket shelf and in other places. It is inevitable and I don't think it is that far away."

Bruce Lamb, managing director of distributor Software Supplies, has had success placing computer training products such as videos and interactive CDs in various retail outlets including bookstores and stationery suppliers.

"The lines are blurring," Lamb said. "Stationery companies already specialise in selling all the accessories and consumables that go with business machines and a computer is just another business machine. So they see training accessories as a logical extension of their product range.

"Bookstores are a bit tougher. There are some marketing prejudices that have to be overcome. While they are very interested in a book that comes with an attached interactive CD, they are not so keen on a CD that comes with a manual."


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