According to recent reports the MTN Group is looking at implementing a deal with Brightstar, a US based distributor of mobile phones and devices, to outsource their retail outlets across South Africa.
The deal would likely see Brightstar taking on the management of MTN’s chain of retail stores as well as their local distribution and logistics operations.
It was also reported that this could affect up to 800 MTN jobs as, according to an industry insider, Brightstar is busy headhunting a range of individuals from senior staff to juniors, recruiting from the ranks of Vodacom, Samsung and LG, although Brightstar is likely to take on some of MTN’s existing staff.
Brightstar is a specialised wireless distributor with an international presence and offers a range of auxiliary services to these markets. It currently has operations in eight African countries including Nigeria, Mozambique, Namibia, Botswana and Egypt.
MTN told the Mail & Guardian that they are “engaged in a reconsideration” of their supply chain, as part of their drive to become a more efficient company, but no contracts have yet been signed.
MTN’s South African division has been under strain recently as they lost 5% of their market share in 2014 dropping from 32% of the market to 27%.
They also suffered a 36% decline in interconnect revenue due to lower mobile termination rates according to their latest financial report.
The outsourcing to Brightstar would be a strategic move for MTN, allowing them to focus on their core business of being a network operator.