Alegro says supply chain contract crucial to its recovery

23 Jul 2009

Struggling Ecuadorian state-run mobile operator Telecsa (Alegro PCS) has awarded an exclusive supply chain services contract to Brightstar, which it says will be key to its attempts to turn its business around and gain market share from its larger privately run competitors. ‘We need a strategic partner that will allow us to purchase handsets under similar conditions to those of our competitors, America Movil (owner of Conecel [Porta]) and Movistar (owned by Telefonica), in terms of pricing and product choice,’ said Augusto Espin, CEO of Telecsa. The cellco’s CFO, Mario Villagomez, added: ‘The relationship with Brightstar is key for the growth and success of our company…The acquisition costs, maintenance costs, financing and opportunity costs and most importantly the cost of lost sales due to stock-outs, have been chronic problems for Telecsa that translate directly to a loss of market share.’ According to TeleGeography’s GlobalComms database Alegro PCS subscribers dropped from a peak of 637,000 at mid-2008 to 303,000 by the end of the year, but have begun to increase gradually since then. The new supply deal covers all handset procurement, fulfillment and third-party logistics operations, ‘advanced replenishment’ to ensure proper placement of inventory throughout Alegro’s channels, specialised device management services and product lifecycle management tools.

Ecuador, Telecsa (Alegro PCS)