By Stuart Wilson
FDC has picked up exclusive distribution rights in the region for Elitegroup Computer Systems (ECS) motherboards. FDC’s move to sign with ECS follows Shuttle’s recent decision to exit the motherboard business. FDC, a strong Shuttle partner in the region, had previously been selling Shuttle motherboards.
FDC has picked up exclusive distribution rights in the region for Elitegroup Computer Systems (ECS) motherboards. FDC’s move to sign with Taiwanese vendor ECS follows Shuttle’s recent decision to exit the motherboard business. FDC, a strong Shuttle partner in the region, had previously been selling Shuttle motherboards.
FDC, which also offer ASRock motherboards, is confident that it can sell approximately 100,000 ECS units per quarter and grab approximately 20% market share. Marissa Safe, VP at FDC, explained: “When Shuttle pulled back from the motherboard business it made sense for us to seek another vendor. Shuttle had been using ECS as a supplier. Therefore it made sense for FDC to seek a distribution tie-up with ECS.”
Girish Kewalramani, sales manager at FDC explains its ECS channel strategy: “We want resellers that are well tuned with FDC’s products and we will offer them an element of exclusivity in their region. With a preferred reseller programme we think margins of around 10% are possible.”
FDC has been awarded exclusive rights for the GCC including the UAE and also Iran. The distributor has carved out a strong reputation in the Middle East as a partner capable of building up both the brand and the channel-to-market for relatively new vendors to the region. For FDC, partnering with a major force in the motherboard makes a great deal of sense given the current industry consolidation trend.
“When I went to Taiwan it was clear that the number of major motherboard manufacturers was going down compared to the last five years,” continued Safe. “Gradually there are less and less motherboard manufacturers and very few vendors producing more than one million motherboards a month. ECS was one of those few players and it also offers technical excellence.”
With both ECS and ASRock in its portfolio, FDC expects to boost its motherboard sales in excess of 700,000 units per annum. According to Safe, FDC’s first quarter revenues climbed 10% year-on-year during 2005 with significant margin improvement.
“The first quarter has been strong and the success of the retail business has helped boost margins,” explained Safe. “Market demand for products such as flash memory from Apacer is climbing and products such as the XPC, NEC notebooks and XFX graphics cards have also played their part.”
FDC is committed to its current vendor portfolio and will work hard to build up its retail channel customer base during 2005. The distributor is mulling over the possibility of adding one more ODD vendor during 2005 to complement its existing NEC product line-up.
“There is a clear shift towards retail and FDC has the products and services required to service this channel,” concluded Safe.