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About Tigerdirect, Inc.

PCM markets and sells computer hardware, software, and services to corporate, government, and educational customers. The company offers products and services from the world's top technology vendors -- including Apple, Cisco, Dell, HP, and Microsoft -- and adds value by packaging multiple offerings into a comprehensive solution. Software is its largest product segment, accounting for nearly 30% of sales; other products include desktops and notebooks, displays, and servers. It generates most of its sales in the US. PCM was founded in 1987 and was acquired by rival Insight Enterprises in a $580 million deal.

Change in Company Type

PCM was acquired by rival IT company Insight Intelligent Technology Solutions in a deal worth $580 million. 

Operations

PCM has four reporting segments that offer similar products and services based on sector and geography: Commercial, Public Sector, Canada, and United Kingdom. 

Its Commercial segment, which includes corporate customers, is far and away the largest, generating about three-fourths of revenue. Federal, state, and local governments, as well as educational institutions, are included in the Public Sector segment, which accounts for more than 10% of revenue. The Canada segment includes all sales made in the Canadian market and brings in nearly 10% of revenue. The UK segment consists of PCM UK, which serves the UK as well as acting as a hub for the rest of Europe.

By product category, software accounts for nearly 30% of the company's revenue, with notebooks, tablets, and desktops together contributing about 25%. PCM's other major product lines include networking, delivered services, displays, storage, and accessories.

Geographic Reach

Headquartered in El Segundo, California, PCM's primary sales and distribution facilities are in the US (California, Georgia, and Ohio) and Canada (Alberta). It also has an operations center in the Philippines and locations in the UK. 

Sales and Marketing

PCM employs a sales force and field service teams and various direct marketing channels (namely e-commerce websites and catalogs) to sell its tech products. The company has taken a leading position as a marketer of Microsoft and HP products, which together account for about a quarter of sales.

Financial Performance

A pattern acquisitions and weak like-for-like sales means PCM's sales growth varies year-by-year between either strong or flat/slightly negative, with seemingly no middle ground.

In 2018 the company's sales fell an immaterial $3 million to $2.2 billion. The Commercial and Public Sector segments declined 4% and 6%, respectively, while Canada grew 14% and the UK 410% due to an acquisition. The large Commercial segment was impacted by several large, low-margin enterprise accounts that did not renew and a decision to be more disciplined in terms of project profitability. Similarly, sales fell in the Public Sector business due to the loss of a low-margin federal contract.

The greater focus on contract margin seemed to bear fruit, with net income growing roughly 800% to $22.8 million, although at 1% of net sales PCM's bottom line needs further work. Net income was negatively affected by a big increase in income tax due to the recognition of a one-time tax benefit in the previous year relating to the US Tax Cuts and Jobs Act.

PCM's cash on hand fell $3.1 million during 2018, ending the year at $6.0 million. The company's operations generated $133.7 million, offset by the $5.8 million used in its investing activities and $130.0 million used in its financing activities. PCM's main cash uses in 2018 were borrowing repayments and, to a much lesser extend, capital expenditures.

Strategy

Although PCM does focus on organic growth, primarily in the areas of end point solutions (digital signage, point-of-sale, field & lifecycle services) and advanced technologies (data center, networking, security, cloud migration), it has grown primarily in recent years through acquisitions.

The company has used acquisitions to bolster and enhance its US operations, as well as to expand first into Canada and then into Europe.

Mergers and Acquisitions

In the past few years, PCM has made multiple acquisitions to strengthen its business in the US and move it into new markets.

Its most recent acquisitions are certain assets of Epoch Universal, and IT provider with capabilities in Unified Collaboration, Networking and Security, Wireless, Data Center, and Virtualization, and Cloud and expertise in Cisco and VMware products; and Provista Technology Services, acquired by PCM UK to enhance its Cisco expertise and vendor accreditations in the UK.

Tigerdirect, Inc.

7795 W FLAGLER ST STE 35
Miami, FL 33144-2367
Phone: 1 (800) 800-8300

Stats

Employer Type: Privately Owned
Vice President Of Merchandising: George Ali
Vice President Information Technology: Michael Delgado
Chp: Richard Leeds
Employees (This Location): 200
Employees (All Locations): 475

Major Office Locations

Miami, FL

Other Locations

Fort Lauderdale, FL
Tampa, FL
Naperville, IL
Raleigh, NC
Port Washington, NY