Brisbane based distributor Cellnet, has announced a major restructure following their exit from the ASX last year and the decision by Optus to go with a US distributor in a move that affected the operations of both Brisbane based Cellnet and Force Technology.
On Friday Cellnet management axed their entire State field reps’ sales team along with several senior executives also gone are several back of house staff, with the business now restructuring for future growth without Optus.
The focus now is on national accounts and new business with the distributor set to announce a new product in the networking market shortly along with other products sourced by their European owners Wentronics.
According to CEO Dave Clark the loss of Optus accelerated plans that were already underway to restructure the business following the acquisition of the business by European Company Wentronics in 2023.
“We are restructuring for the future while also taking advantage of the resources that Wentronics delivers for the business including an extensive team in Hong Kong and China” he said.
“With the loss of Optus, we realised that parts of our business would be commercially unviable, so we moved to restructure with our focus now on expanding our relationship with national accounts and the introduction of new products wehile utalising the resources that our European owners deliver for their Australian operation”.
“It’s never easy letting people go especially in the current environment. We have retained our full National accounts management team with senior staff in Brisbane, Sydney and Melbourne. This was also part of our restructure plans following our delisting” he said.
This as led to some senior management being let go due to duplication of roles and workload” he said.
“Because of the resources that Wentronics delivers spanning marketing, sourcing and product development we are in a very strong position to service clients and launch new products going forward” he added.
Both Cellnet and Force technology whose business was up for sale prior to the decision by Optus to appoint US distributor Likewise, have been affected by the decision to rationalise distribution to their Company owned and franchised retail stores.
Earlier this year Cellnet Sales Director Greg Morrison was let go, he has since established his own Company, with several former Cellnet executives now looking for jobs including Jason Leuzzi the former General Manager Marketing & Sales.
None of Cellnets New Zealand operation have been affected by the changes.
Earlier this year Optus who are facing their own problems, appointed US distributor Likewise, as the sole supplier of goods to both their own and franchised retail stores, with several Optus retail stores including the likes of North Sydney now being closed down.
The decision saw the US Company Likewise move try and get manufacturers, who had been using the likes of Cellnet and Force to switch to the US Distributor, or lose supply arrangements with Optus.
According to sources Dan Mussa Head Of Retail Products (Seen below) at Likewise, used the threat of suppliers losing business at Optus due to their distribution exclusivity.
Suppliers who wanted to stay with Cellnet and Force Technology for distribution to other retailers were told that if they wanted continuation of supply at Optus they basically “Had to hand over their JB Hi Fi business” to L:ikewise.
Brands who approach ChannelNews claimed that they were not happy with the move claiming it was “unethical”.
In a letter seen by ChannelNews Likewise sets out 50% minimum floor margin on stock going into Optus stores, 17% minimum LW Margin, O&A Promotional support during key retail periods and 6% Rebates on shipments made to Optus which are designed to cover Co JMF + Optus Franchise rebates.
The letters written by Mussa spelt out in no uncertain terms that before a deal is cut for these brands to continue supplying Optus, they have to agree new terms with Likewise regarding their current distribution relationships with other distributors.
More to follow.
