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Harnessing opportunity leads to big growth

 

“We started to buy up as much as possible from the markets, from the distributors, from the vendors. We decided to take a gamble.” Janto Lim, Managing Director, Centre Com.

Despite their customers being locked in houses for much of this year, bosses at computer and IT retail chain Centre Com have managed to nail down rapid growth during the COVID-19 pandemic. 

 

How did they do it? 

 

Managing director Janto Lim explains how “the biggest gamble ever for Centre Com” paid off handsomely. 

 

It was the persistent stories of a new virus related to him by contacts from his days working in Asia that tipped off Centre Com managing director Janto Lim that this year would not go according to plan.

 

“I started hearing about COVID, but it was not even called COVID, it was just a normal flu that was happening in China back in early January,” Lim says.

 

As the New Year dawned Centre Com was doing well. 

 

Lim and his team were focussed on keeping the momentum of July to December 2019, in which there had been growth “in a big way”. There had been increased sales to more diverse markets, such as gaming enthusiasts, and also an upping of the company social media presence.

 

“(In early January) I had set a strategy for the whole year.” 

 

“How am I going to maintain that growth? We didn’t know there was going to be COVID.” 

 

While Lim did not know just how quickly those plans would have to change, his ear was to the ground. 

 

Tapping into connections

 

Lim has a range of contacts from his time working in the IT sector in Asia and it was these connections which helped transform his thinking early this year. 

 

“But by mid-January, and the end of January, things were getting very bad, (this was) before even the World Health Organisation declared it a pandemic.”

 

“With the connections overseas, we knew ‘this is going to be bad’.” 

 

He was told there were already shortages of crucial Chinese made components that are used in technology worldwide. It usually took about two months for this to flow through to a shortage in Australia. 

 

Lim went to the Centre Com owners and recommended the company act immediately unless they risk being caught without stock. 

 

“We started to buy up as much as possible from the markets, from the distributors, from the vendors.” 

 

“This was all IT products – monitors, web cams, keyboards, notebooks, desktop computers.”  

 

“We decided to take a gamble.” 

 

A huge decision

 

“It was huge. The biggest gamble ever for Centre Com.”

 

“(But) we knew the shortages were already occurring within China.” 

 

“So we went to the market in Australia to take any stock that was available.” 

 

He said the fact the normal shortages also occur as factories shut down over Chinese New Year also helped prompt the buy up. 

 

Lim now laughs and says “of course” the gamble made him nervous. 

 

“It was a huge decision.” 

 

But then came the worsening of the pandemic, the need to work from home and the rush for products by businesses setting up virtual offices.

 

The pandemic has seen a big shift in the way we work.

 

Lim remembers one Sunday in March when he popped into his Sunshine office, situated right next to a Centre Com store.

 

“There were about 400 customers lined up outside.” 

 

He started working the line, finding out what customers needed.

 

With COVID-19 worsening, the company had to think about how to sell the stock effectively, particularly as the Victorian lockdown kicked in. 

 

“Buying the stock is one thing. You need to know how to sell it and how to execute the sell.” 

 

Compared to 2019, Centre Com’s online business this year has increased significantly, more than 200 per cent. 

 

But during the Victoria stage four lockdown period, the online business was peak around five times that of 2019.

 

“Nobody can prepare for that kind of growth.”  

 

Centre Com introduced changes including free deliveries for certain orders of $79 or more (excluding things like TVs and gaming chairs), and it also upped its website bandwidth. 

 

But also, crucially, its online team reworked the site to enable easier navigation. 

 

He said customer feedback was invaluable in quickly identifying problems and trying to fix them. With all the extra stock the company quickly outgrew its warehouse. 

 

“In May we couldn’t handle the volume increase anymore and it was affecting our customers. We started by hiring a temporary warehouse. Then, in July we found a warehouse about three or four times bigger.” 

 

Centre Com also needed more staff to handle the orders. 

 

At the start of the year full time, part time and casual staff numbered about 180, they now number about 230. 

This all happened during a horror period for Australian business. 

 

Retailers faced an unprecedented start to the year as the Coronavirus propelled Australia to its largest financial contraction since the Depression and household consumption plummeting a whopping 12.7 per cent in the three months to June. 

 

But Centre Com’s quick thinking and gutsy decision making in the face of the shutdown has seen the company flourish. 

 

Centre Com’s revenue growth from calendar year 2019 to calendar year 2020 is now expected to be over 85 per cent. 

Before the crisis, Centre Com had already built itself into one of the biggest IT hardware chains in Victoria focussing on retail consumers, the education sector and business clients.  

 

Victorian roots

 

It is still owned by the orginal owners/directors who set up the first store in Sunshine as a computer equipment provider in 1998. 

 

By early 2014, they were looking for someone to help them grow the business when they heard Lim, who they already knew from his days working for large IT corporates, was returning to Australia. 

 

After years in Asia, as vice president heading sales and marketing operations in Singapore for a semiconductor company Lim wanted to spend more time with family. 

 

“Because of my role (in Singapore) I travelled a lot and I missed a lot of my kids growing up. So, I decided to resign from the company, come back and go into semi-retirement.” 

 

“The owners heard about me coming back and asked me to help out.” 

 

Centre Com has six PC stores, two Apple only stores, three franchise stores and the online site. Lim said they grew by being adaptable and also focussing on good customer service. 

 

He still sits on a number of national and global advisory councils for the likes of Intel, Microsoft, Lenovo, and HP which keeps him abreast of global trends in the tech sector. 

 

These wider industry connections allowed Centre Com to help Victorian students get computers during the lockdown. 

 

For the COVID-19 pandemic period, Centre Com worked with Microsoft and HP to help the Victorian Department of Education and some Catholic schools to source computers for students within strict budgets. Thousands of students benefitted from the effort.

 

It is an issue that Lim is clearly passionate about.

 

“A lot of households only have one computer or no computer. So when the parents need to work from home, the need to have a device for the kids becomes imperative.” 

 

Time to prepare

 

After a year like no other, Lim says Centre Com will now look to bed down its rapid growth, particularly online.

 

Lim expects another uptick in technology sales over Christmas and maybe some strength in back to school sales in late January. 

But he says February, March and April “will be tough”. “We have to prepare for that.” 

 

“The pandemic has changed how the world operates. No one really knows how long this will last and what will be the new normal after the pandemic.” 

 

“One thing for sure is that business will continue … our goal is to be front and centre.”  

 

Centre Com is customer of ANZ.

 

Jeff Whalley is a business writer of more than ten years whose work appeared regularly in The Herald Sun, The Daily Telegraph, The Adelaide Advertiser and the Brisbane Courier Mail.

 

In this series, Jeff talks to small to medium businesses about their journey and experience of growth during 2020 - a year like no other. 

 

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