Gateway Malaysia closes sales office

In a move reflective of the global slowdown in PC sales, US giant Gateway Inc has closed down its sales operation in Kuala Lumpur, retrenching all 70 of its staff, but will retain its Malacca plant.

PETALING JAYA (In.Tech)--In a move reflective of the global slowdown in PC sales, US giant Gateway Inc has closed down its sales operation in Kuala Lumpur, retrenching all 70 of its staff, but will retain its Malacca plant which employs about 400 people.

The company has closed its two Malaysian “Country Stores” located in the Kuala Lumpur City Centre and Mega Mall, as well as two of its four stores in Hong Kong, but has kept its only store in Singapore, a Gateway Asia spokesman told In.Tech last week.

“We felt we did not need the two local stores since the Government’s ‘One Home, One Computer’ initiative--which allows Malaysians to withdraw money from the Employees Provident Fund to buy computers at post offices--has been a huge success.

“We’d also rather work through our business partners; thus our local stores were redundant,” the spokesman said.

“We’re consolidating our regional callcentre, financing and operations at our Malacca site,” she added.

The retrenchment and shutdown were part of a regional exercise to implement a new business model that would see it outsourcing its sales and services functions to its business partners.

The local office, Gateway (M) Sdn Bhd, claimed that it had tried very hard to help its 70 ex-employees get jobs with its partners, Datacom South East Asia (M) Sdn Bhd and Unisys (Malaysia) Sdn Bhd.

“About 90 percent of them (63) had the necessary skills to work with our partners, and we let our partners hold recruitment drives at our office to urge our staff to join them,” the Gateway Asia spokesman said.

As at press time, Gateway said it didn’t have details of how many staff received offers from its partners and how many took them up.

Some of them have moved to Gateway’s Malacca plant, while “plenty” have accepted Gateway’s severance package, which the company claimed was more than required under Malaysia’s labour laws. The company did not give a figure however.

Datacom will now handle Gateway’s regional customer care functions as well as its after-sales service for Malaysia, Singapore and Hong Kong, while Unisys (Malaysia) Sdn Bhd will provide technical support.

In January, Gateway announced it was laying off 3,000 or 10 percent of its workforce after it had to slash its sales forecast for the fourth quarter of 2000.

Earlier this month, analysts with Merrill Lynch & Co and Prudential Securities said they expected the company to report greater losses on lower revenues for the second quarter.

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