Microage, Inc

Recommendations: · MicroAge should expand their informational services division. Demand for informational services in business will continue to grow as internet based e-commerce expands. Profit margins of the distribution segment are dwindling and these trends are expected to continue. The information services division concentrates on value added IT advantages that every business will be forced to embrace given the increasingly competitive environments for all businesses.

· MicroAge may consider selling the distribution portion of the company and use the transfusion of the cash from the sale of this unit to focusing more on the systems integration business which has margins of 30-40%. If MicroAge increased the integration business by 50% in sales they would make up for the disposal of the distribution service.

· MicroAge should focus on smaller to mid-size companies. MicroAge's role would be to introduce IT in their organizations via practical and efficient solutions that streamline processes for small to midsize companies.

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focusing on this sector will yield higher margins than the cutthroat competition now taking place in the Distribution Group.

· Strategic alliances and partnerships with other IT providers will perpetuate MicroAge's continued advance in the informational services market segment. To maintain their market share in this segment MicroAge should continue with these alliances.

· Continue to enhance flow of information. MicroAge was the first in the industry to provide non-proprietary, internet based configuration and electronic catalogs for its product and products in competitors' warehouses. Since mostly every competitor will be able to market and sell items on the internet, they must continue to innovate.

Updates: · MicroAge have expanded services from 34 countries to 46 since January of 1998 and corporation currently employs 6000, up from 2892 in 1997.

· MicroAge created Pinacor, which handles the distribution segment of their business.

· MicroAge's Teleservices division continues to be a major component of their overall business structure and success.

· 1998 Earnings were 5.5 billion up from 4.4 billion in 1997.

· Feb 1, 1999 - Unveils "MicroAge Enterprise IT" - this is touted as the first complete pre-engineered business solution for distributed computing.

· 4/19-MicroAge jumps 35 spots up in the Fortune 500 list, moving up 38 places to No. 297

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