Data Select set to lose key Vodafone contract

Key web fulfilment contract set to go in New Year as Vodafone centralises logistics costs, B2B fulfilment to remain

Distributor Data Select is expected to lose its key Vodafone web filfilment contract in the New Year as Vodafone takes a greater part of distribution in-house and looks to make further cuts in operational expenditure from its UK business.

Vodafone refused to comment. Data Select maintained it had a contract in place with Vodafone for web fulfilment through 2010, and expected to see it out.

Data Select’s contract to serve Vodafone’s dealer and distributor base in the UK goes unaffected, Mobile News understands, including supply to its core Vodafone Partner Services (VPS) unit in Manchester.

But well-placed sources last week said Data Select has been served notice Vodafone will run web sales from 2011 via other sources. Unipart Technology Logistics (UTL), which supplies its retail estate and has run default bulk storage and distribution for it in the UK since 1999, is expected to pick up the slack.

But it was also suggested, in a greater consolidatory move, Vodafone will centralise all of its European handset distribution so it distributes to its satellite markets from a core base on the continent, tailoring SIM-free kit to meet country standards as required and shipping them to UTL in the UK for redistribution.

The move on Data Select is expected as Vodafone UK continues to review all its divisions as part of chief executive Guy Laurence’s (pictured left) new regime to make the business nimbler in the UK market, and also as part of a broader £2 billion Group cost-cutting exercise by 2012.

Group chief executive Vittorio Colao said in November procurement savings will be achieved by channelling more spend via its core procurement company, a centralised purchasing team based in Luxembourg.

Handset manufacturers have been informed of the change in Vodafone’s distribution.

It is unclear if PJ Media, which was sold in a £38 million reverse takeover to online retailer Expansys in July along with SIM distribution business Data Select Network Solutions, will retain its contract with Vodafone for design and maintenance of its online engine.

PJ Media retains a common stakeholder with Data Select, in the shape of Phones International Group, headed by Peter Jones (pictured right).