Gateway beefs up retail space

Claiming traditional retailers provide a poor environment for purchasing computers, Gateway has announced it will open its own chain of retail stores.

"The retail computer buying experience has not been the greatest," said Frank Smilovic, Gateway's Asia-Pacific regional managing director.

Smilovic said traditional retailers, such as Harvey Norman and Myer/Grace Bros, were cluttered, crowded and often had ill-informed staff.

In contrast, Smilovic said the Gateway retail stores would be "non-threatening, fun and a knowledgeable environment". But it's not just the consumer market that Gateway is chasing through its beefed-up retail square metreage.

The retail outlets are a departure from Gateway's traditional direct distribution model, but Smilovic said the stores would not hold inventory. All orders made at the stores would be fulfilled using Gateway's existing distribution channel.

Just over a year ago, Gateway launched a channel partner program for "resellers who are not bogged down with hardware and more focused on providing a service", Smilovic said. He was adamant the retail shop fronts would also be complementary to Gateway's existing sales channels. "The new retail strategy will not conflict with that program.

And according to Gateway's newly appointed Australian managing director, Paul Heath, the new retail stores should be seen as hubs in the distribution wheel. "The [retail] channel is complementary to phone and Web sales," he said. "Consumers will have the opportunity to familiarise themselves with products before placing their orders via the Internet or on the phone," he added.

Gateway plans to have seven stores open by the end of the year, including Melbourne, Adelaide, Canberra and the existing store in Sydney's CBD. Heath claimed that there had been a "phenomenal response" to the recently opened Castle Hill store, northwest of Sydney.

In addition to the new retail outlets, Gateway also has a "store-within-a-store" agreement with more than 40 Telstra retail shops.