Comztek has taken over distribution of Xboxes and its first priority is to restore supply to retailers. After that, it aims to expand the net to include independent outlets, it says.
Earlier this month, former Xbox distributor MiDigital was placed under liquidation, leaving retailers in the lurch as supply of the popular gaming console came to a halt. The liquidation of MiDigital seems to be a result of parent company Music for Pleasure not receiving the funding it required from investors.
Heinz Stephan, technology director at Comztek, says consoles will land in SA two weeks from now and stock will be on retailers' shelves in the last week of the month.
Pre-ordering, based on retailers' requirements, has already been done. Comztek has also met with all the major retail chains to discuss their needs and put new contracts into place, he says.
The major retail outlets, where there is currently a “hole in the channel”, will run properly at month-end, says Stephan. After that, Comztek aims to get independent outlets, such as the chains that have four or five stores that sell games and PC products, into its supply chain.
Once the company has brought the larger of the independent outlets into its net, it will expand communications with the market in order to grow its client base further, he says.
Warranty repairs will continue to be handled by Powercare and the repair channel will remain in place, says Stephan.
Windfall
Stephan says Comztek will be “watching the [distribution] situation very closely” to ensure supply of the consoles proceeds without any further hitches. A task team has been established so that the company “does not drop the ball”, he adds.
The deal with Microsoft, to take up distributorship of the consoles, was a result of a few months of negotiations. Stephan explains Comztek started talks with the software giant after responding to rumours in the market that MiDigital was having problems.
Signing the deal “is a windfall for us,” he notes. The company will be able to cross-sell the other Microsoft products it distributes into outlets it does not already cover. Stephan would not divulge how much extra revenue Comztek expects as a result of the agreement.
Stephan says the company distributes commercial licences for Microsoft products, but also supplies retailers with software packages, such as the Office suite, and hardware, such as keyboards.
The retail distribution chain has been supplying the sector for more than six years. Comztek will add the Xbox consoles, accessories and games onto this supply chain without the need for short-term investment.
“We were ready to take this over,” Stephan says.
Over the longer-term, some investment will be required as the company expands the distribution base to include independent outlets, such as gaming and PC stores, which have already indicated a demand for Xboxes, he adds.
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