Ingram Micro has reiterated its commitment to the Queensland market after announcing the closure of its Brisbane warehouse.
The broad-based distributor's managing director, Guy Freeland, cited a dwindling number of orders being fulfilled by the facility as the primary motive behind the decision.
"The warehouse was only stocking fast moving products such as notebooks and components," he said. "It was fulfilling 20-30 orders a day, so the closure is hardly a major restructuring."
The remaining hundreds of daily orders Ingram fulfilled per day were being shipped overnight from the company's 20,000sqm Sydney facilities, according to Freeland.
The Brisbane warehouse, he said, was only about 400sqm, had a staff of two and was a relic of the old pre-merger Ingram business.
"As an integrated entity we either needed to get much bigger here or do the job from Sydney," he said. "It's something we may readdress in the future but it would have to be done in a meaningful way to service regional and far north Queensland too."
Westan managing director, Victor Aghtan, said Ingram's decision was likely to see its competitors take share.
"The whitebox channel generally needs same-day stock so it could lose those resellers," he said. "But I guess Ingram has looked at the cost of the warehouse compared to the potential loss of business."
For Bluechip Infotech managing director, Johnson Hsiung, the news was a pleasant surprise.
"Queensland is a huge state and it already takes two days to get stock from Brisbane to Cairns," he said. "Resellers also have to pay for freight so they may lose any margin they make on a bulky product from Sydney. They will look to buy locally."
Cellnet's general manager of corporate sales, Daryl Tucker, said the Queensland market was growing at an annual rate of about 10 per cent, which made it a top opportunity for those with local facilities.
"Having a local warehouse is a vital resource for resellers," he said. "We let them use ours as if it were their own so their customers can come and pick up the stock themselves if they like."
According to Freeland, Ingram had consulted resellers prior to the closure and would work hard to keep any disgruntled dealers on the books.
"Resellers always have a choice but we'll work to reach alternative arrangements, on a case-by-case basis, with any who feel this may have an impact on their business," he said. "We still have a full-service office here with about 25 people and we are absolutely committed to the Queensland market."
Freeland also hinted at further potential changes to Ingram's Sydney facilities.
The company had recently dispensed with a third-party supplier of a third warehouse and was considering the consolidation of its second warehouse into the main Matraville hub.
"We will also look at Melbourne, which is being used for a particular purpose and products at the moment," he said. "We'll see if there's a better way to do that."
Queensland resellers contacted by ARN were not too fazed about the closure of its Brisbane warehouse.
Albion-based The Computer Market director, Kurt Kratzmann, said it was no surprise to see Ingram shut it down. "The size of the warehouse wasn't big enough and the facilities were not up to scratch," he said. "Unless we desperately needed something, the Brisbane warehouse was just a bonus."
Infinet Personal Computers assistant manager, Ray Elliot, said he had just started dealing regularly with Ingram and would now be receiving products from Sydney. The Pimlico-based dealer also sources product through other distributors with warehouses in the Smart State including Synnex, Westan and TodayTech.
"Ingram is simply cutting costs and making room for the competition," he said Cairns-based Brilliant Computer Services managing director, Colin MacKinnon, said the closure didn't concern him because it wouldn't effect delivery times.
"The Brisbane warehouse didn't offer us that much," he said. "It never had the same stock as Sydney or Melbourne and freight times will be the same."