Systemax Rides an Online Sales Wave (Published 2004)
- ️Sun Jul 18 2004
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- July 18, 2004
SYSTEMAX INC., a computer company in Port Washington, hardly fits the description of a corporate titan. Its three top executives are all sons of an original owner and grew up in Woodmere. The boxy, nondescript Systemax headquarters is a leased building in an industrial park just off Old Northern Boulevard. Though publicly held, the company is a tiny fraction of the size of some of its competitors.
Yet Systemax is making a name for itself in the volatile world of computer retailing, thanks to soaring online sales, which accounted for a quarter of its $1.6 billion total sales last year. Its retail model is built on rapid turnover, low inventory and razor-thin profit margins.
''They found a sweet spot on the ice that's not too thin and not too watery, and they're showing that they know how to skate on it,'' said Richard Doherty, a computer industry analyst and the president of the Envisioneering Group, a Seaford consulting company.
Its robust online component allowed Systemax to bounce back three years ago from depressed sales and a wave of layoffs. Its Web catalog, www.tigerdirect.com, has emerged as a top destination for computer enthusiasts, displacing I.B.M.'s Web site as the third-most popular computer hardware site. The top two are Hewlett-Packard and Dell's sites, as ranked by Alexa Internet, an Amazon.com subsidiary that measures such things.
With its combination of extensive illustrations and mind-numbing product detail, TigerDirect has overtaken eBay as the ''longest visited'' computer shopping site, with visits averaging a leisurely 12 minutes, according to a recent report from Nielsen NetRatings.
Systemax began in 1949 as an industrial-supply company, Global Equipment, founded in Corona, Queens, by Mike Leeds and his brother, Paul. Mr. Leeds's sons are now in charge: Richard, 44, is the chairman and chief executive, and his 48-year-0ld twin brothers, Bruce and Robert, are vice chairmen. Bruce also holds the title of president of international operations and Robert the title of president of domestic operations.