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Local IT businesses benefit from a weak Aussie dollar

WHILE the low Aussie dollar may mean holidays to the US and the UK are more expensive, it is providing Perth-based IT companies with a chance to expand into international markets.

Local IT companies are taking advantage of our weak currency against the US dollar and the UK pound by undercutting the cost of established IT providers in those countries. In some instances Perth businesses are able to quote up to two thirds less than their competitors in the US market.

ineedhits.com, a burgeoning web analysis company in Osborne Park, recently used its cost advantage to sign a lucrative deal with US-based Inktomi Pty Ltd, a search engine submission specialist. ineedhits.com was one of three Internet search engine companies selected for the deal

ineedhits.com head of operations Roy Pinto believed it was the company’s cost advantage that was a major selling point in the deal.

“It’s definitely a selling point. Every time we do a presentation with companies in the US, that’s something we hit on straight away, on how we can do our business so much cheaper. It’s having a good response from them,” Mr Pinto said.

But he said it was important that ineedhits.com was just as good as, or better than, its competitors, as well as being cost effective.

“The services that we are providing are quite unique in the industry. So the things we can do, not only can we do them better, but cheaper as well,” Mr Pinto said.

He said the Inktomi deal was a major stepping-stone for the company into the US. While cost may give Perth-based organisations an advantage, it was still difficult to break into the foreign markets, he said.

“That is why the Inktomi deal is such an important one for us, because it will give us visibility and advertising on a world wide scale,” Mr Pinto said.

“We have been under the radar for a while now but this has really put us on the main street. People in the industry know Inktomi have done their homework on us before taking us on board and now we are starting to see doors opening for us.”

He said that, as a result of the deal, ineedhits.com was looking into establishing an office in the US. Mr Pinto acknowledged the extra costs involved, including paying staff US rates, but said it was important to have a consistent presence.

“We are very seriously considering setting up an office. Perhaps we need to set up a virtual office there, we’re in the process of investigating it,” he said.

ASG, formerly Amcon Solutions Group, opened its UK office in Wimbledon in June. ASG chief technology officer Steven Tull said both Australian and English staff worked at the office and were paid in UK pounds.

He said although running the office reduced the cost effectiveness of some of ASG’s services, the business still could offer cheaper services than local providers.

“Our prices are still fairly compelling. The UK is fairly focused on cost reduction at the moment. it is a tight market over there so they see it as a viable cost,” Mr Tull said.

And Perth was better positioned to compete in international markets than Sydney or Melbourne, he said.

“I think one thing that should differentiate Perth from the rest of Australia is our competitive rates,” Mr Tull said.

“ I mean, Sydney rates are nearly double what we charge here, so Perth in particular has that advantage.”

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