DCS credit concerns

Several distributors across Dubai are facing losses unless Direct Computer Systems’ (DCS) battle to straighten out its financial situation is successful. Industry insiders claim distributor Trigon recently launched proceedings to try and recover outstanding credit after cheques from DCS bounced.

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By  Stuart Wilson Published  November 30, 2004

Several distributors across Dubai are facing losses unless Direct Computer Systems’ (DCS) battle to straighten out its financial situation is successful. Industry insiders claim distributor Trigon recently launched proceedings to try and recover outstanding credit after cheques from DCS bounced. “Trigon opened a case against DCS,” said Mohammed Al Faloujhi, credit manager at Empa, a distributor also owed a small amount by DCS. “I do not know why this did not happen earlier. DCS has had outstanding debts with many companies for some time and has not been paying.” DCS operates as a local assembler and Intel sub-distributor in the region. In recent weeks, the company has been attempting to sound out potential investors to provide a financial injection. Samer Bayrakdar, director at DCS, is currently overseas on business, according to a company spokesperson and was unavailable for comment. DCS’ financial issues are partly due to the fact it has not yet received rebates and incentives that it believes it is entitled to. DCS is not alone in this respect. In recent months, Intel has stepped up checks on all its assemblers to ensure that its Intel Inside scheme is being used in the correct way. “When you are talking about a customer qualified for the Intel Inside programme, it does not mean he is getting 100% reimbursement on all Intel products purchased from authorised distributors,” explains Maan Ahmadie, channel manager for the Middle East, Turkey and Africa at Intel. “If we believe an account is 30% assembly and 70% resell, the Intel Inside programme only covers 30% of what is purchased. This is something we need to be very clear about,” he adds. Despite its financial problems, DCS management is adamant that it is capable of resolving payment issues with its distributors and believes it can find an investor that allows it to keep on trading. DCS claims to have resolved its credit issue with Trigon and says it is negotiating with other distributors as well. DCS is the latest in a long line of Dubai channel players hit by financial problems during 2004.

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