Troubled Dutch PC and services vendor Tulip has admitted that it will be six months late launching its e-commerce Web site.
As it came out of receivership last autumn, Tulip identified shifting its sales to the Web as a major goal. The company had aimed to have its e-commerce site running by the second quarter, but this has now been delayed until the fourth quarter.
"There was no point coming to market in April with a half-assed effort," Neil Grayston, managing director of Tulip UK, told PC Week.
Still, Tulip's business through its reseller channel was above expectations, he insisted. Orders were up 55% on the first half of last year, a good performance when taking into account that there were no sales in May and June last year, after the company went into receivership in late April 1998.
Extensive cost cutting helped Tulip UK achieve a gross profit margin of 64%, he said. Jobs had been cut by 30%, and half of Tulip's premises are now rented to a third party.
But the key to improving profit was outsourcing Tulip's huge manufacturing plant in the Netherlands to US computer distributor Ingram Micro, said Grayston. Ingram now manufactures PCs and servers for Tulip.
"Manufacturing was never a core competence for Tulip. For smaller players to survive, they have to outsource their manufacturing," said Grayston, who predicted that more vendors would outsource manufacturing to third parties.
This was why German vendor Siemens had approached the Taiwanese vendor PC Acer last year and Fujitsu this year, he said.
COMMODORE IS OUT
Tulip has turned its back on the Commodore brand, which it bought in September 1997 in a bid to project itself into the retail market, Grayston said.
"Tulip is not using the Commodore brand nor will it in the UK. It was the wrong strategy," he admitted. "At some point Tulip may offload it."
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