Internet Mini Case #2
Internet Mini Case #2
Tech Data Corporation
Maryanne M. Rouse
The Company
TECH DATA CORPORATION’S (TECD) AGGRESSIVE GROWTH HAD TAKEN THE COMPANY from 10 employees and $2 million in sales in 1983 to approximately 8,000 employees and $15.7 billion in sales for fiscal 2002 (fiscal year ended January 31, 2003) and secured the company’s position as a leading distributor of information technology (IT), logistics management, and other value-added services to “solution providers,” including value-added resellers (VARs), direct marketers, retailers, corporate resellers, and Internet resellers. Ranked 117 on the Fortune 500 list, the company and its subsidiaries served more than 100,000 technology resellers in the United States, Canada, the Caribbean, Latin America, Europe, and the Middle East. Tech Data was incorporated in 1974 to market data processing supplies, including tape, disk packs, and custom and stock tab forms for mini and mainframe computers directly to end users. With the growing popularity of microcomputers and the emergence of microcomputer dealers, the company withdrew entirely from end-user sales and made the transition to wholesale distribution in 1984. The company’s flexible structure comprised five major product divisions (components, systems, peripherals, networking, and software) plus Strategic Business Units (SBUs) designed to address specific market, channel, customer, or product opportunities. Tech Data’s current SBUs included digital imaging/CAD, mobile solutions, security, storage, and telephony. Fiscal 2002 sales by product category were peripherals, 46%; components and systems, 24%; networking, 15%; and software, 15%. On a channel basis, VARs accounted for 58% of the company’s $17.2 billion 2002 sales, with direct marketers, retailers, and Internet resellers comprising 24% and corporate resellers accounting for the remaining 18%. No single customer accounted for more than 5% of sales during fiscal 2002.
This case was
Tech Data Corporation
Maryanne M. Rouse
The Company
TECH DATA CORPORATION’S (TECD) AGGRESSIVE GROWTH HAD TAKEN THE COMPANY from 10 employees and $2 million in sales in 1983 to approximately 8,000 employees and $15.7 billion in sales for fiscal 2002 (fiscal year ended January 31, 2003) and secured the company’s position as a leading distributor of information technology (IT), logistics management, and other value-added services to “solution providers,” including value-added resellers (VARs), direct marketers, retailers, corporate resellers, and Internet resellers. Ranked 117 on the Fortune 500 list, the company and its subsidiaries served more than 100,000 technology resellers in the United States, Canada, the Caribbean, Latin America, Europe, and the Middle East. Tech Data was incorporated in 1974 to market data processing supplies, including tape, disk packs, and custom and stock tab forms for mini and mainframe computers directly to end users. With the growing popularity of microcomputers and the emergence of microcomputer dealers, the company withdrew entirely from end-user sales and made the transition to wholesale distribution in 1984. The company’s flexible structure comprised five major product divisions (components, systems, peripherals, networking, and software) plus Strategic Business Units (SBUs) designed to address specific market, channel, customer, or product opportunities. Tech Data’s current SBUs included digital imaging/CAD, mobile solutions, security, storage, and telephony. Fiscal 2002 sales by product category were peripherals, 46%; components and systems, 24%; networking, 15%; and software, 15%. On a channel basis, VARs accounted for 58% of the company’s $17.2 billion 2002 sales, with direct marketers, retailers, and Internet resellers comprising 24% and corporate resellers accounting for the remaining 18%. No single customer accounted for more than 5% of sales during fiscal 2002.
This case was