About PC Connection
PC Connection, Inc. operates as a Fortune 1000 Global Solutions Provider that simplifies the information technology (IT) customer experience, guiding the connection between people and technology. The company’s dedicated account managers partner with customers to design, deploy, and support cutting-edge IT environments using the latest hardware, software, and services. The company provides a wide range of IT solutions, from the desktop to the cloud—including computer systems, data center solutions, software and peripheral equipment, networking communications, and other products and accessories that it purchases from manufacturers, distributors, and other suppliers. The company’s Technology Solutions Group, or TSG, and state-of-the-art Technology Integration and Distribution Center, or TIDC, with ISO 9001:2015 certified technical configuration lab offer end-to-end services related to the design, configuration, and implementation of IT solutions. The company’s team also provides a comprehensive portfolio of managed services and professional services. These services are performed by the company’s personnel and by third-party providers. The company’s GlobalServe offering ensures worldwide coverage for its multinational customers, delivering global procurement solutions through its network of in-country suppliers in over 170 countries. The Connection brand includes Connection Business Solutions, Connection Enterprise Solutions, and Connection Public Sector Solutions, which provide IT solutions and services to small to medium-sized businesses, or SMBs, enterprise, and public sector markets. The company united all of its subsidiaries into one cohesive brand, reflecting the promise of its blue arc. These entities represent the company’s three operating segments and their respective markets, such as Connection Enterprise Solutions – serving large enterprise customers; Connection Business Solutions – serving SMBs; and Connection Public Sector Solutions – serving federal, state, and local government and educational institutions. The company generates sales through outbound telemarketing and field sales contacts by sales representatives focused on the business, educational, healthcare, and government markets; its websites, and direct responses from customers responding to its advertising media. The company offers a broad selection of over 460,000 products at competitive prices, including products from vendors like Apple, Cisco Systems, Dell, Dell-EMC, Hewlett-Packard Inc., Hewlett-Packard Enterprise, Lenovo, Microsoft, and VMware, and it partners with more than 2,500 suppliers. The company is able to leverage its state-of-the art logistic capabilities to rapidly ship product to customers. The company’s strategy’s effectiveness is reflected in the recognition it has received, including being named to the Fortune 1000 and the CRN Solution Provider 500 for twenty-two straight years. The company strives to identify the unique needs of its corporate, government, educational, and small business customers, and has designed its business processes to enable its customers to effectively manage their IT systems. The company provides value by offering its customers efficient design, integration, deployment, and support of their IT environments. The company’s Industry Solutions Group, or ISG, provides its sales team and customers with insights and guidance customized to the unique needs of its vertical markets, including healthcare, retail, finance, and manufacturing. The company markets its products and services through its websites: www.connection.com, www.connection.com/enterprise, www.connection.com/publicsector, and www.macconnection.com. Business Strategies The key elements of the company’s business strategies include providing consistent customer service before, during, and after the sale; offering a broad product selection at competitive prices; simplifying technology product procurement for corporate customers; offering targeted IT solutions; maintaining a strong brand name and customer awareness; maintaining long-standing vendor relationships; expanding hardware and software offerings; expanding IT solution services offerings; targeting customer segments; increasing productivity of its sales representatives; migrating to cloud-based solutions for its customers; and pursuing strategic acquisitions and alliances. Service and Support The company provides products and services that meet the demands and needs of its customers and to supplement those products with up-to-date product information and excellent customer service and support. The company offers its customers superior value, through a combination of product knowledge, consistent and reliable service and support, and leading products and serves as the foundation for developing a broad and loyal customer base. The company invests in training programs for its service and support personnel, with an emphasis on putting customer needs and service first. Supplementing the company’s salesforce, its TSG and TSO offer in-depth technical support across a wide range of advanced technology solutions. These teams of engineers and solution architects design end-to-end IT solutions tailored to the company’s customers’ unique environments and serve as technology consultants. The company’s TIDC ensures a superior customer experience, with seamless configuration, deployment, and support services. Product support technicians assist customers with questions concerning compatibility, installation, and more difficult questions relating to product use. The product support technicians authorize customers to return defective or incompatible products to either the manufacturer or to the company for warranty service. In-house TIDC technicians perform both warranty and non-warranty repair on most of the major systems and hardware products. Using its customized information system, the company transmits its customer orders either to its TIDC or to its drop-ship suppliers, depending on product availability, for processing immediately after a customer receives credit approval. At its distribution center, the company also performs custom configuration services, which typically includes custom imaging, the installation and integration of additional components, and other technology enhancements. The company’s customers may select the method of delivery that best meets their needs and is most cost effective, ranging from expedited overnight delivery for urgently needed items to ground freight. The company’s inventory stocking strategy is based on economics and the general availability of the product. The company also will stock product to support customer rollouts, including product that is running through its configuration and integration services prior to shipment. Marketing and Sales The company sells its products through its direct marketing channels to SMBs including small office/home office customers, government and educational institutions, and medium-to-large businesses. The company strives to be the primary supplier of IT products and solutions to its existing and prospective customers by providing exemplary customer service. The company uses multiple marketing approaches to reach existing and prospective customers, including outbound telemarketing and field sales; digital, web, and print media advertising; and targeted marketing programs to specific customer populations. All of its marketing approaches emphasize the company’s broad product offerings, fast delivery, customer support, competitive pricing, and its wide range of service solutions. Sales Channels: The company’s ability to establish and maintain long-term customer relationships and to encourage repeat purchases is largely dependent on the strength of its sales personnel and programs. Because the company’s customers’ primary contact with it is through its sales representatives, it is committed to maintaining a qualified, knowledgeable, and motivated sales staff with a principal focus on customer service. Outbound Telemarketing and Field Sales: The company seeks to build loyal relationships with potential high-volume customers by assigning them to individual account managers. The company pays most of its account managers a base annual salary plus incentive compensation. E-commerce Sales: The company generally provides product descriptions and prices for all of the products it offers through the e-commerce websites it maintains and operates. The company’s Connection website also provides updated information for more than 460,000 items. The company offers, and continuously updates, selected product offerings and other special buys. The company’s websites are an important source of sales and a communication tool for improving customer service. For example, the company’s Enterprise Solutions Segment’s business process and operations are primarily Web-based. Most of its corporate customers utilize a customized Web page to quickly search, source, and track IT products. The company’s Enterprise Solution business website aggregates the available inventories of its largest IT suppliers into a single online source for its corporate customers. Its custom designed Internet-based system, MarkITplace, provides corporate buyers with comparative pricing from several suppliers, as well as special pricing arranged through the manufacturer. The Internet supports three key business initiatives for the company: Customer Choice — The company has built its business on the premise that its customers should be able to choose how they interact with it - be it by telephone, or by means of their desktop or mobile device via email or the Internet. Lowering Transactions Costs — The company’s website tools include robust product search features and Internet Business Accounts (customized Web pages), which allow customers to quickly and easily find information about products of interest to them. If customers still have questions, they may call its account managers. Such phone calls are typically shorter and have higher close rates than calls from customers who have not visited the company’s websites first. Leveraging the Time of Experienced Sales Representatives — The company’s investments in technology-based sales and service programs allow its sales representatives more time to build and maintain relationships with its customers and to help them to solve their business problems. Operating Segments The company conducts its business operations through three operating segments: Business Solutions, Enterprise Solutions, and Public Sector Solutions. Business Solutions The company’s principal target markets in this segment are small to medium-sized business customers. The company uses a combination of outbound telemarketing, including some on-site sales solicitation by business development managers, and Internet sales through customized Internet Business Accounts, to reach these customers. Enterprise Solutions Through its custom designed Web-based system, the company is able to offer its larger corporate customers an efficient and effective method of sourcing, evaluating, purchasing, and tracking a wide variety of IT products and services. The company’s strategy is to be the primary single source procurement portal for its large corporate customers. Public Sector Solutions The company uses a combination of outbound telemarketing, including some on-site sales solicitation by business development managers, and Internet sales through customized Internet Business Accounts, to reach these customers. The company targets each of the four distinct market sectors within this segment—federal government, higher educational institutions, school grades K-12, and state and local governments. The company’s ISG works across all operating segments to service the unique needs of healthcare, retail, finance, and manufacturing customers. Within each of these vertical markets, the company’s ISG experts offer technology solutions and guidance backed by real-world experience. The company’s ISG combines extensive knowledge of the latest technologies, brands, and trends with industry experience that reassures its customers that it understands their businesses and their technology challenges. The company’s brand, and each of its operating segments, is supported by targeted marketing campaigns across a variety of media: Digital: The company utilizes a series of digital programs, in conjunction with advanced data analytics, to identify prospective customers and generate new leads within its existing customer base. These programs include website, email, blog, social media, electronic catalogs, webinars, and video/multimedia promotions. Specialty Marketing: In addition to its digital marketing efforts, the comopany maintains a strong presence at industry tradeshows and conventions across the country, including a number of healthcare and education IT conferences. The company also hosts a series of Technology Summits each year, with a focus on building stronger relationships with its customers and reinforcing its reputation as a trusted source of expertise. Customers: The company maintains an extensive database of customers and prospects. However, no single customer accounted for more than 4% of its consolidated revenue in 2022. Products and Merchandising The company continuously focuses on expanding the breadth of its product and service offerings. The company offers its customers over 460,000 IT products designed for business applications from more than 2,500 vendors. These products consist of hardware, including devices, peripherals, accessories, servers, and networking products, along with software and services. The company selects the products it sells based upon their technology and effectiveness, market demand, product features, quality, price, margins, and warranties. The company offers a 30-day right of return generally limited to defective merchandise. Substantially all of the products marketed by the company are warranted by the manufacturer. The company generally accepts returns directly from the customer and then either credit the customer’s account or ship the customer a replacement or similar product from its inventory. Purchasing and Vendor Relations Product purchases from Ingram Micro, Inc., TD Synnex Corporation and Dell Inc. accounted for approximately 23%, 22% and 15% respectively, of the company’s total product purchases in 2022. Products manufactured by HP Inc. collectively represented approximately 14% of the company’s net sales in 2022. Distribution The company fulfills orders from customers both from products it holds in inventory and through drop shipping arrangements with manufacturers and distributors. The company receives and ships inventory, configure and integrate technology solutions, provide depot maintenance and services, and process returned products. The company’s technicians maintain extensive certifications and authorizations from all major manufacturers, with more than 90% of the TIDC team holding one or more CompTIA certifications. Through the TIDC, the comopany is able to offer customers turnkey solutions for all of their IT needs, including hardware configuration, imaging and provisioning, asset management, remote management, white glove enrollment services, kitting, custom packaging, and depot repair services. The company also places product orders directly with manufacturers and/or distribution companies for drop shipment directly to its customers. Competition The company competes with other national solutions providers of IT products, including CDW Corporation, SHI, and Insight Enterprises, Inc., who are the current leaders in the space. The company also competes with certain product manufacturers that sell directly to customers, as well as some of its own suppliers, such as Apple, Dell, HP, and Lenovo; software publishers, such as Microsoft, VMware, Adobe, and Symantec; distributors that sell directly to certain customers, such as Apple, Dell, Lenovo, and HP; cloud providers, such as Amazon Web Services, Google and Microsoft; large service providers and system integrators, such as Accenture, Dell EMC, Hewlett Packard Enterprise and IBM; communications service providers, such as AT&T, CenturyLink and Verizon; various franchisers, office supply superstores, and national computer retailers, such as Office Depot and Staples; and e-tailers, such as Amazon, with more extensive commercial online networks. Intellectual Property Rights The company’s trademarks include among others, Connection, PC Connection, GovConnection, MacConnection, we solve IT, Everything Overnight, Mobile Connection, Cloud Connection, Education Connection, MoreDirect A PC Connection Company, WebSPOC, Softmart, GlobalServe, Raccoon Character, and their related logos and all iterations thereof. Regulatory Matters The company’s Public Sector Solutions segment is heavily regulated and, as a result, its need for compliance awareness and business and employee support is significant. Specifically, the company’s Public Sector Solutions segment is governed by various laws and regulations, including but not limited to laws and regulations relating to: the formation, administration, and performance of contracts; the security and control of information and information systems; international trade compliance; human trafficking; and the mandatory disclosure of credible evidence of a violation of certain criminal laws receipt of significant overpayments, or violations of the civil False Claims Act. In addition, U.S. government contractors are generally subject to other federal and state laws and regulations, including: The Federal Acquisition Regulation, or FAR, agency supplements to the FAR, and related regulations, which regulate the formation, administration, and performance of U.S. federal government contracts; The False Claims Act, which allows the government and whistleblowers filing on behalf of the government to pursue treble damages, civil penalties and sanctions for the provision of false or fraudulent claims to the U.S. federal government; The Truth in Negotiations Act, which requires certification and disclosure of cost and pricing data in connection with the negotiation of certain contracts, modifications, or task orders; The Procurement Integrity Act, which regulates access to competitor bid and proposal information, as well as certain internal government procurement sensitive information, and regulates its ability to provide compensation to certain former government procurement officials; Laws and regulations restricting the ability of employees of the U.S. government to accept gifts or gratuities from a contractor; Post-government employment laws and regulations, which restrict the ability of a contractor to recruit and hire current employees of the U.S. government and deploy former employees of the U.S. government; and The Cost Accounting Standards and the Cost Principles, which impose accounting requirements that govern its right to reimbursement under certain cost-based U.S. government contracts and require consistency of accounting practices over time. The company’s Public Sector Solutions is also subject to oversight by the U.S. Office of Federal Contract Compliance Programs, or OFCCP, for federal contract and affirmative action compliance, including various areas, such as affirmative action plans; applicant tracking; compliance training; customized affirmative action databases and forms; glass ceiling and compensation audits; desk and on-site audits; conciliation agreements; disability accessibility for applicants and employees; diversity initiatives; equal employment opportunity compliance; employment eligibility verification (known as E-Verify); internal affirmative action audits; internet recruiting and hiring processes; OFCCP administrative enforcement actions; record-keeping requirements; and Sarbanes-Oxley Act of 2002 compliance. Under applicable federal and state laws, the company is required to comply with a number of requirements when sending commercial email or making telephone calls to consumers. For example, under applicable federal and state unfair competition laws, including the California Consumer Legal Remedies Act, and U.S. Federal Trade Commission, regulations, the company must accurately identify product offerings, not make misleading claims on its platforms, and use qualifying disclosures where and when appropriate when distributing commercial emails to consumers. The company is also subject to the Federal Telecommunications Commission’s Telemarketing Sales Rule, the Telephone Consumer Protection Act, and the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003, which generally limit the consumers and types of communications it can make via telephone, text, automatic telephone dialing systems, and artificial and prerecorded voices. History PC Connection, Inc. was founded in 1982. The company was incorporated in 1983.
