About Nexel Industries Inc.

Systemax's system involves being direct. The company is primarily 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 maintains three business segments. The EMEA Technology Products Group (EMEA) and North America Technology Products Group (NATG) segments make up nearly 85% of the company's total sales combined, and sell computing products (including laptops, desktops and tablets, computer components, and commercial and home networking accessories) and consumer electronics (including Tvs, audio equipment, cameras and surveillance, GPS, cell phones, video games and toys, and home and electronics accessories) that are mostly manufactured by other companies to customers in Europe and North America, respectively.

The Industrial Products Group (IPG) segment makes up the remainder of Systemax's total sales, and sells material handling, storage and shelving, workbench and shop desks, packaging and supplies, and other hardware for HVACs, plumbing, and medical professionals. Some of the company branded products are marketed under the Global, GlobalIndustrial.com, Nexel, Relius, Relius Elite, and Hercules trademarks.

Geographic Reach

New York-headquartered Systemax rings up about 60% of its sales in the US, nearly 15% in the UK, and 10% 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.

Overall, it spent $66.1 million on advertising in 2014, up from $60.1 million in 2013.

Financial Performance

Systemax's sales and profits have been declining 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 company's revenue rose by 3% to $3.44 billion in 2014, however, mostly thanks to a 17% increase in sales of Industrial Products as it introduced new product offerings on its websites, enjoyed solid sales of its core offerings, and expanded its private-label and brand-name selections. Systemax's Technology Products business also grew modestly thanks to its 2014 acquisition of SCC Services, strong sales growth in France, improved B2B sales in certain markets in Europe and North America, and favorable exchange rates.

While it suffered another year of losses from high sales, administrative, and general expenses, Systemax's losses lightened to $37.5 million in 2014 (compared to a loss of $43.8 million in 2013) thanks to higher revenue during the year. The company used $100,000 in cash toward its operations (operations provided $46.8 million in 2013) mostly because of fluctuation in its accounts receivable, inventory, and income tax payable (receivables) balances.


Facing shrinking sales and profits, Systemax has been restructuring its business to turn its situation around. In March 2015, for example, its Technology segments exited the retail store business to renew the company's focus on higher-margin, business-to-business B2B operations. The exit plan would involve closing all of its retail stores, a distribution center, and slashing its staff to free up resources for investment in B2B business. The company would also be transitioning its retail customer base to its online channels to keep its former retail relationships going.

With overseas sales growth outpacing sales at home in recent years (the company's international business contributed about a third of 2014 sales, up from 27% in 2008), Systemax has had its eye on more business in Europe, and, to a much lesser extent, Asia. In 2013, to support and boost its European Technology Products business, Systemax opened a shared services center in Budapest, Hungary, to provide administrative and back office services for the existing European business and serve as the sales location for future business in Eastern Europe. The company has also been building its European operations through acquisitions, as with its 2014 acquisition of Netherlands-based SCC Services

Systemax is attempting to improve the performance of its European business, in particular Misco in the UK, amid soft sales there. Initiatives include top executive changes and expanding its service offering.

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.

In June 2014, Systemax acquired SCC Services B.V., a supplier of business-to-business IT products and services with operations in the Netherlands.

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.

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Nexel Industries Inc.

11 Harbor Park Dr
Port Washington, NY 11050-4656
Phone: 1 (516) 625-1555
Fax: 1 (516) 625-0039


  • Employer Type: Public
  • Pres: Richard Leeds
  • V Pres: Robert Leeds
  • Vice President: John Sviter

Major Office Locations

  • Port Washington, NY

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