“Customers on 30-day terms will be offered an early settlement discount but if they’re late then the meter starts running. Dealers know how it is and don’t expect you to be an interest-free bank.”
On current transaction forecasts, Dicker estimated the late payment scheme would generate about $50,000 per month.
“Of course it won’t work out like that because it encourages people to pay on time but we’ll still get an upside through not having to chase those payments,” he said.
Dicker offers free freight on all orders over $500 to most geographies.
“We worked out years ago that freight was costing us about 0.5 per cent so we raised prices by that amount and introduced free freight,” he said.
Express Data managing director, Ross Cochrane, said it was constantly looking at costs and conducted stringent reviews but would not be introducing additional charges. One way to drive down costs, he said, was to get closer to your suppliers.
“We look to take costs out of their [freight carriers] business by minimising how often they have to come out and using our fork lifts wherever possible. It’s not about shopping around for the best price; it’s about making the process more efficient overall,” he said.
“Surcharges and levies are just blaming somebody else. Customers want to see a price for product and a price for freight so they can make easy comparisons – additional charges make those comparisons horrendous.
“We are supposed to be setting an example in the IT industry and moving other industries towards e-commerce. I think we’ve lost sight of what we’re trying to achieve if we spend thousands of dollars modifying systems to cope with different charges.”
Synnex Australia CEO, Kee Ong, said it was also reviewing cost structures very closely but couldn’t say when that process would be completed.
“Fuel costs are up and down at the moment so we need to wait for a period of time,” he said. “We are looking at logistic and financial costs but at this moment we haven’t seriously considered changes.”
Freeland joined Ingram Micro via its acquisition of Tech Pacific, which was forced to backtrack in 2001 after the introduction of handling fees for small orders drew reseller ire. Initially set at $1000 in April 2001, it was reduced to $250 within six months and eventually abandoned by new boss, Kerry Baillie, in January 2002 just a week after taking charge.
“It wasn’t successful at the time but that doesn’t mean it isn’t the correct way to go today,” Freeland said.
