Ingram Micro Growth Formula: Consistent Management, New Ownership… And Acquisitions?

At first glance, there’s something very familiar and predictable about Ingram Micro. Each time you check in with the distribution giant, chances are you’ll see a familiar face or hear a familiar voice. But take a closer look, and you’ll see how those familiar leaders appear well-positioned to drive Ingram’s business forward in new ways.

Jennifer Anaya, Ingram Micro

Paul Bay, Ingram Micro

The background: It has been nearly three months since Platinum Equity acquired Ingram Micro from Chinese conglomerate HNA Group. At the time of the ownership transition, Ingram Executive VP Paul Bay reiterated the company’s top three market priorities for the distributor and its partners:

  1. Win together.
  2. Transform the IT customer experience across the entire lifecycle.
  3. Deliver more solutions and more deeply engage the company’s global partner communities.

A check-in with Jennifer Anaya, senior VP of global marketing, revealed plans to double-down on Ingram’s existing marketing strategies. Translation: Partners could expect consistent, continued messaging amid the ownership transition.

A separate conversation with Kirk Robinson, chief country executive for Ingram Micro U.S., revealed a distributor that was eager to move far more deeply into the government partner market.

Ingram Micro: Improved Growth Prospects, Acquisition Opportunities

Kirk Robinson, Ingram Micro

Fast forward to present day, and the new ownership improves growth prospects for Ingram, according to FitchRatings, a debt ratings service that recently took a close look at the business. Among the reason for optimism: Ingram is now free from “onerous provisions that often limited the company’s ability to invest in certain growth opportunities,” FitchRatings asserts.

Under new owner Platinum Equity, the current setting “should allow Ingram Micro to pursue acquisition targets and to capture previously missed growth opportunities, including domestic sales into sensitive product areas,” the ratings service says. Translation: Robinson and the Ingram team no longer have to navigate HNA Group-related question marks in the government market.

Moreover, Ingram has a strong, defensible market position in target vertical markets, the ratings service adds. Plus, new sources of demand from Automotive, Industrial and IoT present opportunities to expand into new end-markets, the rating service notes.

Ingram Micro: Rivals and Competition

Admittedly, Ingram’s margins are somewhat below rival TD SYNNEX at 2.5% to 3.0% and the peer median at 4%, the ratings service notes. But here’s a thought to keep in mind: Ingram’s new ownership doesn’t require any type of digestion or merger time. In stark contrast, it will likely take some time for the newly formed TD Synnex to digest and combine various operations from the recent Tech Data-Synnex merger.

Meanwhile, multiple market segments are converging toward the distribution sector. For instance, public cloud service providers such as Amazon Web Services (AWS), Google Cloud Platform and Microsoft Azure have built software marketplaces that have attracted ISVs and end-customers.

Also, cloud distributors such as Pax8 and Sherweb have emerged. And MSP-centric software providers such as ConnectWise are building marketplaces.

All that said, Ingram will need to balance organic growth with M&A opportunities. Among the recent moves, Ingram Micro’s CloudBlue business confirmed the HarmonyPSA acquisition in March 2021.

By August 2021, CloudBlue launched CloudBlue Rev in the North America market. The move further blurs the line between PSA (professional services automation) software, online storefront and cloud distribution platforms that MSPs leverage.

What’s next? Surely, those familiar faces are brainstorming a few next moves — all of which will be partner-centric. Stay tuned.

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