CHS, which was hit by a shareholder law suit last week, isn't the only global distributor with problems.
Ingram Micro's global reorganisation will see the distributor reduce its workforce by 1400 and combine its purchasing, vendor sales and product marketing functions into a single merchandising unit.
Ingram will also close its Californian consolidation centre, realign its sales force and adopt new programs in its distribution centres in response to a perceived "softness in sales during the first quarter of 1999", according to a company statement.
"Many near-term factors, including year 2000 fears and continuing economic issues, are creating cautious buying trends in Europe, Latin America and Asia. In addition there is intense margin pressure, primarily in the US, which is related directly to increased price competition and not related to changes in the way computers are brought to market," said Jerre Stead, chairman and chief executive officer of Ingram Micro.
Michael Shea, general manager of Ingram-owned ERA in Australia, asserts that "the restructuring in the US has no effect on Australian operations at all. It will be business as usual because we target our own markets and have always operated under the present Ingram system".
However, US company officials warn that Ingram will put further emphasis on streamlining operations and is planning to "intensify" the process of "attrition and personnel redeployment" that has been occurring outside the US since late last year.
Ingram Micro officials believe the cost saving and efficiency measures it is undergoing will ensure the company's 1999 first-quarter results will be between $US6.5 and $6.7 billion, a 26-30 per cent increase on the same time last year.
ITG scoops awards
It was good news on the local front for Ingram, with its ITG subsidiary scooping the distributor accolades in IBM's channel awards.
ITG won distributor of the year for the PC group, took out an Asia-Pacific excellence award for distribution and was also recognised as IBM's and Lotus' number-one software distributor.
Braham Shnider, ITG's managing director, put down ITG's success to being able to "provide what our customers want, when they want it, be that products, information, pricing or knowledge".
"There is no doubt in my mind we know IBM products better than anyone else, and hopefully that benefits our reseller customers," Shnider said.
Other IBM winners included Software Spectrum (see page 30) and integrator BCA (see page 26).