Computer Hardware Chain TigerDirect Ditches Retail for B2B

The computer hardware market has largely shifted online, and today, a physical retail location for such technological parts is rare. TigerDirect was one of the few, but its parent company revealed significant changes that will land the company on the B2B side of the computer parts supply market.

In its 2014 fourth quarter earnings report, Systemax announced Tuesday (March 10) that it will refocus its computer hardware supply chain subsidiary TigerDirect on business-to-business operations.

The announcement declared that Systemax would close nearly all of TigerDirect’s brick-and-mortar locations by the end of the second quarter of 2015. Retail locations in Miami, Georgia and Puerto Rico will remain open, according to reports.

But the rest will see their doors shutter as TigerDirect looks to shift its business model in response to the growing computer hardware e-commerce market, reports said.

In the Q4 earnings report, Systemax Chairman and CEO Richard Leeds said that the B2B refocusing “will include the exit of substantially all retail store locations; closing a distribution center; and implementing a general workforce reduction to realign our resources solely with our B2B focus.”

Soon after, a TigerDirect employee reportedly launched a Reddit discussion confirming the news. The employee also noted that TigerDirect had recently begun issuing pay cards instead of paper checks to its staff in efforts to cut costs.

It is unclear, however, exactly how TigerDirect will channel its sales to businesses, or how its existing digital commerce strategy will change. A decision to shutter brick-and-mortar locations is hardly surprising, however, not only in the computer hardware industry. Experts have long been tracking the emergence of digital-only retail locations as well as retailers’ – both B2C and B2B – efforts to combine an online and physical shopping strategy.

What is clear is how wholesalers and suppliers will need to evolve to meet the digital demands of today’s buyers, and TigerDirect’s latest announcement could signal efforts by the company to do so.