About SYSTEMAX INC.

Systemax is a direct marketer of computers, electronics, and technology products in North America and Europe (where it operates under the Misco brand). Through catalogs, websites, and retail stores, Systemax markets thousands of brand-name and private-label computer, networking, camera, GPS, cell phone, video game, and other electronic products. Systemax also sells material-handling equipment, shelving, storage items, furniture, and other industrial products. Its customers include businesses, government agencies, and schools, as well as individual consumers. Systemax was founded in 1949 as Global Equipment Company.

Operations

Systemax consists of two business segments: EMEA Technology Products Group (EMEA) and Industrial Products Group (IPG).

EMEA (standing for Europe, Middle East, and Africa) is the larger of the two at 55% of company revenue and sells IT products under the MISCO and Inmac WStore brands. The two sell a range of electronic products, from consumer electronics such as laptops, desktop computers, and tablets to network infrastructure and printers and toner. Inmac WStore is for the Francophone market.

IPG sells to the US and Canadian markets under the brands Global Industrial, C&H Distributors, Nexel, Avenue Supply, Global.ca, Industrialsupplies.com, and PFI. It accounts for the remaining 45% of revenue. Less electronics focused that its counterpart, IPG sells material handling, storage and shelving, workbench and shop desks, packaging and supplies, and other hardware for HVACs, plumbing, and medical professionals.

Geographic Reach

New York-headquartered Systemax rings up about 40% of its sales in the US, about 15% in the UK, and 25% in France. Other markets in Europe and North America contribute the remainder.

Sales and Marketing

Systemax counts businesses, government agencies, schools, and individuals among its consumers.

For business customers, Systemax uses a multi-faceted direct marketing system comprised of its relationship marketers, catalog mailings, and proprietary internet websites. Systemax markets to consumers online through website campaigns, banner ads, and email campaigns. Its e-commerce initiatives and catalog mailings generate online orders and calls to inbound sales representatives.

Financial Performance

Systemax is struggling. The company's sales have declined and its losses have piled up over the past few years, mostly due to weakness in Systemax's Technology Products business as selling prices for computers and televisions have declined. The sale of its North American B2B unit in 2015 virtually halved revenue.

In fiscal 2016, revenue fell a further 9% to $1.7 billion due to a 9% fall in EMEA revenue, notably due to poor performance in the UK the exit of MISCO Germany. The Netherlands and France performed well. IPG revenue saw net growth of 2% (comprising a 3% gain in the US and a 10% fall in Canada) amid an increase in demand for material handling, HVAC, and furniture. Higher headcount also contributed.

Net loss narrowed to $32.6 million from $99.8 million the year before, due mostly to reductions in loss from continuing and discontinued operations.

Cash from operating activities swung negative (from $86.5 million to $-57.4 million) due to changes in inventories.

Strategy

Systemax is letting go of more and more deadweight in an increasingly desperate attempt to stay afloat. The company has sold off huge chunks of its business, including its North American B2B unit and most recently its European MISCO operations, excluding France. France is one of the few of Systemax's business units performing well, and will form the core of the European business going forwards.

Mergers and Acquisitions

In January 2015, to grow its business in the industrial products market, the company's Industrial Products Group purchased B2B direct marketer Plant Equipment Group (PEG), which specialized in maintenance, repair, and operation (MRO) products, from TAKKT America for $25.9 million cash. The deal expanded the IPG presence in the maintenance, repair, and operations (MRO) market.

Company Background

Looking to gain from the ruin of failed US electronics merchants, Systemax emerged as the winner for the brand, trademarks, and e-commerce operations of Circuit City in 2009. Although CircuitCity.com relaunched in mid-2009, Systemax said it was too early to determine whether retail stores would also make a comeback.

Unlike Circuit City, Systemax has been expanding CompUSA's network of retail stores. (It acquired CompUSA's brand, trademarks, and e-commerce unit, as well as about 15 retail outlets, for $30 million in 2008.) The company rebranded its more than 10 existing TigerDirect shops as CompUSAs and added five new locations in 2009. It added about half a dozen more CompUSA stores in 2010. Systemax said it purchased the electronics giants in an effort to expand its e-commerce operations, led by TigerDirect, its online computer sales subsidiary.

The company exited the retail business in the US in 2015 with the sale of the operations to PCM.

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SYSTEMAX INC.

11 Harbor Park Dr
Port Washington, NY 11050-4656
Phone: 1 (516) 608-7000

Stats

  • Employer Type: Public
  • Stock Symbol: SYX
  • Stock Exchange: NYSE
  • Chairman: Richard Leeds
  • Vice Chairman: Robert Leeds
  • Vice Chairman: Bruce Leeds
  • 2016 Employees: 2,800

Major Office Locations

  • Port Washington, NY

Other Locations

  • Hoover, AL
  • Huntsville, AL
  • Little Rock, AR
  • Manchester, CT
  • Orange, CT
  • Wilmington, DE
  • Altamonte Springs, FL
  • Boca Raton, FL
  • Clearwater, FL
  • Deerfield Beach, FL
  • Fort Myers, FL
  • Medley, FL
  • Miami, FL
  • Palm Beach Gardens, FL
  • Tampa, FL
  • West Palm Beach, FL
  • Atlanta, GA
  • Augusta, GA
  • Clive, IA
  • Naperville, IL
  • Rockford, IL
  • Indianapolis, IN
  • Wichita, KS
  • Lexington, KY
  • Louisville, KY
  • Baton Rouge, LA
  • Metairie, LA
  • Baltimore, MD
  • Columbia, MD
  • Glen Burnie, MD
  • Rockville, MD
  • Detroit, MI
  • Lansing, MI
  • Troy, MI
  • Bridgeton, MO
  • Charlotte, NC
  • Raleigh, NC
  • Omaha, NE
  • Nashua, NH
  • Salem, NH
  • East Hanover, NJ
  • Holmdel, NJ
  • Mount Laurel, NJ
  • Princeton, NJ
  • Springfield, NJ
  • Las Vegas, NV
  • New York, NY
  • Rochester, NY
  • Syracuse, NY
  • West Nyack, NY
  • Fairlawn, OH
  • Miamisburg, OH
  • Oklahoma City, OK
  • Tulsa, OK
  • Pittsburgh, PA
  • Carolina, PR
  • Guaynabo, PR
  • Warwick, RI
  • North Sioux City, SD
  • Memphis, TN
  • Nashville, TN
  • Abilene, TX
  • Austin, TX
  • Cypress, TX
  • Dallas, TX
  • Frisco, TX
  • Houston, TX
  • Irving, TX
  • San Antonio, TX
  • Sunset Valley, TX
  • Glen Allen, VA
  • Newport News, VA
  • Norfolk, VA
  • Vienna, VA
  • Iron Ridge, WI
  • Madison, WI
  • Milwaukee, WI
  • Pleasant Prairie, WI
  • Burlington, Canada
  • Calgary, Canada
  • Etobicoke, Canada
  • London, Canada
  • Markham, Canada
  • Mississauga, Canada
  • Richmond Hill, Canada
  • Woodbridge, Canada
  • Le Plessis Robinson, France
  • Saint Michel, France
  • Langen (Hessen), Germany
  • Neu-Isenburg, Germany
  • New Delhi, India
  • Lacchiarella, Italy
  • Hägersten, Sweden
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