VentureTech Members Voice Support For Ingram's Offshoring Initiative

VentureTech members attending Ingram Micro's annual Spring Invitational event, which kicked off Sunday, said they don't see the offshoring initiative or the restructuring as affecting their support or service from the Santa Ana, Calif.-based distributor. The restructuring and offshoring plan stand to eliminate 550 positions, or about 11 percent of Ingram Micro's North American workforce.

"I think it's a great move to stay competitive," said Adam Eiseman, CEO of The Lloyd Group, a New York-based VentureTech member. "These are jobs that need to be outsourced. They need to shift their business model and grow their business. I don't want them to die. They are a valuable business partner."

Eiseman said he hopes Ingram Micro will offer some outsourcing capabilities as services to its VARs. "There are certain things that need to move to a lower-cost model, and they could possibly help us with that," he said, adding that the offshoring issue reminds him of the debate many years ago about how the use of computers would take away some people's jobs.

"This is one of the most highly competitive industries on the planet. How can [Ingram Micro] not do that when everybody else is?" said David Sahl, president of Computer Ware, a Modesto, Calif. VentureTech member. "If they don't do it, then it is death. You can have one person doing technical support here or eight doing it overseas for the same price."

Tracy Butler, president of St. Louis-based Acropolis Technology Group, a new VentureTech member, said he does most of his business with Ingram Micro online, so the offshoring initiative won't affect his business. "It's all self-service through the Web," he said. "It works very well. We do all our business over the Web and have an assigned account rep."

Ingram Micro, which announced the restructuring and offshoring plans last week, is set to ink what's expected to be a five-year deal with an unnamed outsourcing provider by the end of the month. Among the positions slated to be moved offshore are a number of inside-sales representative posts, but the largest number of positions affected by the initiative will be in finance. E-commerce support and sales and tech support via the Web through the distributor's eSolutions group also will be handled by the outsourcer, along with the 20 percent of product returns and inventory requests not completed online. VAR tech support won't be outsourced.

Mark McKeever, vice president and COO of MicroAge, a Tempe, Ariz.-based solution provider, said he's not concerned by Ingram Micro's offshoring moves. "We have every expectation that they will be able to continue to serve us effectively," he said.

The distributor is taking steps to make sure the outsourcing transition goes smoothly, McKeever added. "Historically, Ingram has executed well when they made changes. I have no reason to believe they won't do the same here," he said.

One solution provider executive, who asked not to be identified, said Ingram Micro has no choice but to outsource some functions because of pricing pressure. "What choice does Ingram have but to reduce costs if they want to serve a price-conscious reseller channel?" the executive said. "They are a global company with more than half of their sales coming internationally. What is wrong with taking advantage of the technology that we sell and repurposing certain functions overseas?"