August 26, 2008, 12:32 PM — Tech Data has apparently taken a pass on a couple deals with big customers, which would have totaled about $100 million in revenue.
According to Tech Data CEO Bob Dutkowsky, the deals went to a competitor who offered "rock-bottom" prices--and Tech Data just didn't want to go there. Dutkowsky doesn't see the loss of the deals as having a long-term impact, and he's probably right on the money there, as the company remains quite profitable. Not taking the deal may have decreased overall revenue for the year, but on the other hand, taking the deal would have decreased the profit margin.
Can't say as I blame them for passing up on low-margin deals, and this gives us all cause to think about just how low we would be willing to go to get business in a lousy economy. Offering the lowest prices in the business isn't always the best strategy.
