Melbourne-based distributor, CHA, appears to be on the fast track to recovery after its kerfuffle with global distribution giant CHS Electronics last year and has appointed itself a new General Manager to lead the way to greener pastures.
Peter Thatcher, former CEO of Tracker Software, has taken the reins from Steven Sampson and has set about aggressively consolidating the company.
"Fundamentally there is a good underlying business here and it's just a matter of bringing it back," says Thatcher.
"CHA as an organisation probably took a left-hand when it should have made a right turn last year and got itself into a bit of financial difficulty with CHS." But Thatcher has every intention of retaining CHA's place as a major player in the mobile computing arena in Australia.
CHS acquired CHA in July 1999 through an "earn out" relationship that would have been completed in July 2001, but numerous financial woes left CHS unable to meet its obligations. These woes also saw some of CHA's channel partnerships disintegrate, such as the one with Network Associates International (NAI).
Putting all of this in the past, Thatcher plans to grow CHA as a specialist in mobile computing and sees WAP, PDA, and wireless technology, as the basis of this expansion.
"We don't want to build a billion dollar a year company," he says, "I don't think there's room in Australia for more than one Tech Pac. What we do see is there is room in Australia for companies that specialise in what they know best and stick to doing that well."Thatcher has been involved in the channel, in one way or another, for the last 10 years. He was consulting for CHA for eight months previous to taking up his current position and believes this has given him an edge in understanding how to rectify the mistakes made with CHS.
Thatcher undertook immediate cost reductions in February this year which, he says cut out approximately 30 percent of the company's overheads. "We had a decentralised distribution model which doesn't work for CHA because we don't have the economy of scale. It's all pretty much commonsense stuff. At the end of the day distribution is process driven. If we can reduce the cost on each process we make more margin."Thatcher has also taken a closer look at the technology backbone of the organisation. "We made some tough decisions and decided to move away from some vendors because they didn't quite fit our business model," he says.
After being heart broken by CHS, Thatcher says CHA is not too keen to start up any new partnerships. "We're going to get our own sh*t together before we start dating anyone else," he says. "Our priority at the moment has got to be that we have a robust and commercially viable operation and if we continue to operate in that manner we will attract the right type of partner."