Ingram Micro Debuts ‘Bold New’ Brand As Distributors Face ‘Headwind’

By Kelly Teal Comments
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Ingram Micro Inc. this week launched a new look as the company faces what one financial analyst firm has called “headwind" from rivals – who no longer are the usual suspects such as Tech Data and SYNNEX, but also companies including Intelisys and Telarus, among others.

"This is more than a logo change; we view this brand refresh as an investment in our future," said Alain Monié, CEO at Ingram Micro, in a prepared statement. "Ingram Micro has made bold new moves with recent acquisitions, establishing global business units and developing a more global and customer-centric mindset with an agile, insightful and dependable culture. Refreshing and repositioning the Ingram Micro brand is a natural next step in our company's growth and success. It signals our evolution from a distribution powerhouse to the world leader in technology and supply chain services. Our new brand identity and strategy is a reflection of a bold new Ingram Micro."

Ingram Micro’s new branding comes as distributors across the board are having to change their business models, as the IT sector moves from focusing on one-time equipment sales to an ongoing services and solutions approach.

At the same time, these distributors are coming up against master agencies such as Intelisys and Telarus, which are rooted in network services and recurring revenue – two areas IT distributors historically have ignored and now are rushing to incorporate. Indeed, such master agents also now are calling themselves technology services distributors and encroaching on distributor’s traditional IT market share.

The evidence lies in the earnings. In April, Ingram Micro, for its part, reported what Zacks dubbed “tepid" first-quarter results and “moderate" guidance for the second quarter. Analysts indicated there’s good in that assessment, although Ingram Micro has more work to do.

“We believe that an improving IT spending trend will help Ingram post better results, going forward," Zacks analysts wrote in an April client memo. “Furthermore, the company’s focus on the high-margin market and strategic acquisitions to increase market share are encouraging. Nonetheless, Ingram Micro’s growth initiatives will have an impact on its margins in the near term, which along with the high debt burden and competition from Avnet and Arrow remains a headwind."

Ingram Micro is not alone. Tech Data’s first-quarter profit fell almost $18 million from the year-ago period, Avnet’s revenue was down for its third fiscal quarter, while Arrow Electronics’ first-quarter revenue missed analyst expectations. The next round of earnings reports is due in July. Indeed, all of these distributors are clamoring to bring resellers into the cloud, mobility and network services era. The unanswered question remains whether the companies will succeed, differentiating themselves from rivals and offering channel partners platforms that solve end users’ business problems.

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