The fragility of the computer distribution system in Southeast Asia was demonstrated last year as financial crises caused the channel-marketing system to virtually implode in some countries.
Aside from the Internet and large corporations or governments, personal computer-makers usually do not sell directly to the customer.
Instead, they rely on a channel system through which they ship products to distributors and wholesalers, who in turn transport products to retailers or other sales agents.
In the first half of last year, vendors were extending credit to large or trusted distributors when shipping PCs, typically expecting repayment within 15 to 60 days, according to International Data Corp Asia's head of PC research in Singapore, Dane Anderson.
'Many of these distributors operated on a positive cash-flow basis', with cash from sales to retailers being used to buy more products, Mr Anderson said.
When the financial crises caused PC sales to slump, 'channels came to a standstill and the whole process got bogged down'.
