Research: Logistics challenges Gulf high-tech Industry

Published October 23rd, 2000 - 02:00 GMT

A research conducted among resellers of information technology products and services in the Gulf has shown that the physical delivery of hardware and software products is a major concern to the majority of companies servicing technology buyers in the region today.  


The research, conducted by the independent research house, Paradigm Research, for Computer 2000/Tech Data, also highlights issues surrounding the regional shipment, transportation and stocking of products, showing that logistics — the physical movement of products — is highly consuming management time in the Gulf’s IT industry today. 


"Resellers in this market, as in other world markets, need to be able to focus on the needs of the customers, rather than in shipping packages," said Ali Ferling, general manager of Hewlett Packard Middle East.  


According to the survey, the companies that service end-user demand for information technology in the region are being forced to concentrate on stocking to avoid delays as well as on sourcing, ordering and the physical movement of products around the region. The result is a shift in focus away from customer service and support — a factor that is slowing development in the industry.  


“The move to increasing customer support and value added services is being held back as resellers are being forced to concentrate on trying to juggle slim profit margins with the need to spend time and effort in moving, storing and handling products to meet demand,” said Computer 2000/Tech Data managing director Steve Lockie. “The result is undoubtedly being felt by end users of these technologies as vendors are unable to invest in a more service-oriented business model.” 


The study, conducted in October 2000 among resellers in the UAE, Oman, Bahrain, Kuwait, Qatar and Saudi Arabia, reveals that some 65 percent of IT vendors in the UAE expressed a desire for shorter product delivery times from distributors, while 68 percent of managers in the reseller sector of the industry are currently forced to dedicate a proportion their time to logistics management. 


“We’re looking at an industry that is customer-focused, but that is at the same time being driven to invest their advanced resources addressing what should be viewed as basic business issues. There is a very real need for organizations that handle the distribution of these goods to react to these concerns,” said Lockie, “Computer 2000/Tech Data will announce new initiatives at GITEX 2000 designed to bring stronger logistical resources to bear on the needs of resellers, meeting the requirements of today’s UAE market.” 


“Although we perceive today’s IT reseller in Dubai as a ‘storefront operation’ servicing walk-in demand, in fact some 70 percent of resellers in the market are focused on the needs of enterprise customers — customers that need fast, reliable, delivery of products. This research tells us that resellers aren’t getting the backup they need to meet those kinds of demand,” said Lockie.  


Computer 2000 LLC is a member of the $17 billion NASDAQ listed Tech Data group (TECD), a global provider of IT products, logistics management and other value-added services. The Fortune 500 company and its subsidiaries serve more than 100,000 technology resellers in the United States, Canada, the Caribbean, Latin America, Europe and the Middle East.  


Computer 2000’s service offering includes pre- and post-sale training and technical support, financing options and distribution and logistics management services. — (Albawaba-MEBG)

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