The biggest IBM personal computer distributor in Europe, MBS Plc, dropped something of a bombshell yesterday: it is getting out of the personal computer distribution business, shutting down its Data Distribution Ltd arm in Warrington. The one months’ stocks, which currently tie up UKP15m of working capital, will be diverted to the arm of MBS’ business that deals direct with end-users, so the company insists that it will not have to take any charge against its figures for discontinuation of the business. It will however see a sharp drop in turnover: Data Distribution accounted for UKP43.9m of the company’s UKP136.1m turnover last year and was expected to reach UKP60m this year. The company’s large accounts business will enable it to retain its IBM Distributor status, and it says that the withdrawal is being made because the market has become so competitive that it was impossible to achieve acceptable margins – they are three times better when MBS sells direct to large accounts. Biggest beneficiary of the withdrawal is likely to be Northamber Plc, which has been in the forefront of the price-paring: Northamber is said to be delighted at the MBS decision, and cheerfully admits that it makes little money distributing IBM machines – but makes up for it with all the other products it is able to sell to the same customers.
