Description of Tessco Technologies Incorporated's Business Segments
We principally offer competitively priced, manufacturer brand-name products,
ranging from simple hardware items to sophisticated test equipment, with per
item prices ranging from less than $1 to over $150,000 and gross profit margins
ranging from less than 5% to 99%. Base station infrastructure products are used
to build, repair and upgrade wireless broadband systems. Products include base
station antennas, cable and transmission lines, small towers, lightning protection
devices, connectors, power systems, enclosures, grounding, jumpers, miscellaneous
hardware, and mobile antennas. Our base station infrastructure service offering
includes connector installation, custom jumper assembly, site kitting and logistics
integration. Network systems products are used to build and upgrade public and
private wireless broadband networks. Products include fixed and mobile broadband
radio equipment, wireless networking filtering systems, distributed antenna
systems, two-way radios and security and surveillance products. This product
category also includes training classes, technical support and engineering design
services. Installation, test and maintenance products are used to install, tune,
and maintain wireless communications equipment. Products include sophisticated
analysis equipment and various frequency-, voltage- and power-measuring devices,
as well as an assortment of tools, hardware, GPS, safety and replacement and
component parts and supplies required by service technicians. Mobile devices
and accessory products include cellular, smart phone and data device accessories
such as replacement batteries, cases, screen protectors, speakers, mobile amplifiers,
power supplies, bluetooth and corded headsets, mounts, car antennas, music accessories
and data and memory cards.
While we principally provide manufacturer brand-name products, a variety of
products are developed, manufactured and offered under TESSCO-owned brands including
Ventev', Wireless Solutions', and TerraWave®. The products we offer under
these brands generally consist of device accessory products that fall into the
mobile device and accessory product category, as well as WLAN and network systems
accessory products and remote monitoring and control solutions that fall into
the network systems category. Also, our WLAN certification training is offered
under our training unit GigaWave® trade name and is reported in the network
systems category. We have not incurred significant research and development
expenditures in any of the last three fiscal years.
Our products are sold as part of our integrated product and supply chain solutions.
Our supply chain services for all product areas are grouped under Knowledge,
Configuration, Delivery and Control. Knowledge solutions include the entire
suite of TESSCO knowledge tools that focus on educating the industry, including
product highlights, showcases and/or comparisons, with comprehensive specifications
on the products, solutions and applications that are offered and reinforced
by engineering, sales and technical support, as well as hands-on training programs.
Configuration services are comprised of customized product solution kitting
and assembly, logistics management and consumer and retail merchandising and
marketing, allowing the products to be delivered ready for immediate use, installation
or resale. Our delivery system allows the customer to select speed of delivery
options, to specific delivery locations, designed to eliminate the customer’s
need for staging and warehousing. Our services that increase customer control
include predetermined monthly pricing levels, the ability to monitor multi-site
purchasing with pre-approved, customized parameters indicating who is able to
order how much of which specific products, order delivery tracking, product
usage tracking, history reporting and alternative financing options.
As part of our commitment to customer service, we typically allow most customers
to return most products for any reason, for credit, within 30 days of the date
of purchase. Total returns and credits have been less than 3% of revenues in
each of the past three fiscal years.
The amount of purchases we make from each of our approximately 400 vendors may
significantly increase or decrease over time. As the level of business changes,
we may request, or be requested by our vendors, to adjust the terms of our relationships.
Therefore, our ability to purchase and re-sell products from each of our vendors
depends on being able to reach and maintain agreements with these vendors on
acceptable business terms. In addition, the agreements and arrangements on which
most of our larger vendor relationships are based are typically of limited duration
and terminable for any or no reason by either party upon notice of varying lengths,
usually between several months and two years. Generally, we believe that alternative
sources of supply are available for many of the product types we carry, although
we may be unable, or find it more difficult, to source branded products from
other than the manufacturer.
The scope of products available for purchase from a given vendor may fluctuate,
and is generally limited only by the scope of the vendor’s catalog and
available inventory. Therefore, we often source the same product type from multiple
vendors, although in some instances branded products are available only from
the manufacturer or a particular vendor, and in some instances, customers might
favor one vendor or brand over another. The terms of the vendor contract typically
apply to all products purchased from a particular vendor, whether or not the
item is specifically identified in the contract.
When negotiating with vendors, we seek the most favorable terms available under
the circumstances. Our preferred terms include among others, terms that provide
for product warranty and return rights, as well as product liability and intellectual
property indemnification rights, in each case consistent with our preferred
business methods and objectives. We have not been able, nor do we expect in
the future to be able, to negotiate the inclusion of all our preferred terms,
or our preferred language for those terms, in every vendor contract. The degree
of our success in this regard is largely a function of the parties’ relative
bargaining positions.
We are dedicated to superior performance, quality and consistency of service
in an effort to maintain and expand vendor relationships but there can be no
assurance that we will continue to be successful in this regard in the future,
or that competitive pressures or other events beyond our control will not have
a negative impact on our ability to maintain these relationships or to continue
to derive revenues from these relationships.
Intraday data delayed per exchange requirements. All quotes are in local exchange time. Intraday data delayed 15 minutes for Nasdaq, and other exchanges. Fundamental and financial data for Stocks, Sector, Industry, and Economic Indicators provided by CSIMarket.com
Disclaimer: Information provided by CSIMarket.com is for informational purposes only and does not constitute investment advice, recommendation, or solicitation to buy or sell any security.
