Arrow pulls plug on ANZ enterprise computing solutions arm

Arrow Electronics has decided to shutter its enterprise computing solutions (ECS) business in Australia and New Zealand.

A statement provided to CRN Australia states that “Arrow Electronics has made the strategic decision to close its enterprise computing solutions business operations in Australia and New Zealand as part of a continuing initiative to invest in growth areas across the company’s businesses."

The company stated it would “honour its global contractual obligations, maintaining a limited presence to support these commitments.”

“Arrow is committed to providing smooth transition for its employees and channel partners during this period,” the statement reads.

“Customers will receive continued support through Arrow’s channel partner network.”

“The decision will not impact Arrow’s Global Components business located in Melbourne, Arrow Electronics Australia Pty Ltd.”

For the financial year ending December 31, 2023, the company reported that Arrow ECS and Arrow ECS New Zealand employed approximately 74 people.

Global challenges

Arrow Electronics reported a 15 per cent drop in global year-on-year sales for the third quarter of 2024 finishing at the end of September. It recorded a sharp decline from US$25.258 billion for the nine months to the end of September 2023, to US$20.640 billion for the same period of time in 2024.

The Arrow ECS business around the world grew with robust performance.

In the third quarter of 2024, Arrow ECS pulled in US$1.877 billion in sales globally, compared to US$1.762 billion in the same quarter a year earlier, an increase of seven per cent.

The growth was driven by a healthy market for hybrid cloud solutions, steady dynamics in Europe, and an improving trajectory in North America. 

Arrow Electronics reported on restructuring activities when announcing its global third quarter results in October 2024.

“In line with our ongoing efforts to simplify our operations, we are restructuring the business to drive additional cost savings,” stated Arrow’s senior vice president and CFO Raj Agrawal in October.

That October announcement flagged expected costs from exiting certain lines of “non-core” business. It also highlighted opportunities to reduce annual operating expenses by the end of 2026 by up to $100 million, primarily related to reorganising and consolidating certain areas of the company’s operations.

ANZ modernisation

In early 2023, Arrow flagged ambitions to modernise its ECS ANZ business in line with Arrow globally, to act “as a global value-added distributor in the modern data centre, virtualisation, analytics, networking and cyber security areas”.

At the same time, it named Paul Marnane, formerly the Arrow ECS country manager in Ireland, as the new GM of Arrow ECS ANZ. At the time, Marnane spoke about the company taking advantage of being part of a $37 billion global business.