28/05/2009 - 00:00

Netlink booming after near bust

28/05/2009 - 00:00


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INFORMATION technology company Netlink Group shouldn't exist.

Netlink booming after near bust

INFORMATION technology company Netlink Group shouldn't exist.

Ten years ago, the company was enjoying the spoils of the technology bubble, where orders for computers and software piled up as quickly as work emails.

But at the same time Netlink moved to a more spacious and expensive Leederville address to accommodate the growth, the technology bubble burst.

"When we opened the doors the phones stopped ringing," managing director Steve van Blommestein said.

"We were about a dollar away from insolvency and I don't mind admitting it."

Netlink's expenses had doubled and sales had dried up as company decision-makers pondered why they spent so much on protecting their businesses against the Y2K non-event. Listed tech companies were going bust, and businesses were slashing IT budgets.

With the phones silent, Mr van Blommestein had time to contemplate the future, if any, for the company. He decided to change Netlink's focus from sales to service, targeting mid-tier companies looking to outsource their IT needs.

Almost a decade on, and managed service contracts are the "jewel in the company crown", according to Mr van Blommestein. For a set monthly fee, Netlink takes ongoing care of a business's IT systems.

The ongoing service includes monitoring IT systems and offering off-site and on-site support. Technology also allows companies like Netlink to profit from installing systems that can reduce a company's energy costs.

Tech firms can install lighting that switches on in the evening when a cleaner enters the room,and off when they leave, instead of lighting whole buildings or floors during the night. Heat can also be directed in buildings away from areas flooded with sunlight to cooler areas.

Rather than trying to grow the business by simply increasing client numbers, Netlink's goal is to grow the number of devices a client uses.

"To do this, we have built a product that is infinitely more attractive and valuable to clients and we expect this to deliver far more aggressive results than our past method of selling services," Mr van Blommestein said.

"This transformation, done during one of IT's most difficult periods, almost ended Netlink's existence. However it is now recognised as the very turning point that took Netlink from monthly uncertainty to annual predictability."

Netlink's key market is small to medium size companies with 50 to 100 employees that want to outsource their IT needs.

Netlink's annual turnover has doubled since the 2005 financial year - as has its staff - and the company recently cemented a strong relationship with multinational Clipsal to implement its electrical systems into commercial and residential markets.

Mr van Blommestein said the growing market of "intelligent buildings" offered opportunities to his firm. New office blocks are increasingly installing technology, such as sensored lights that dim or switch off depending on the amount of natural light, which cut energy usage and attract star ratings from the Green Building Council of Australia.

Mr van Blommestein said the key people needed to drive change had taken up equity in the business through a personal investment.


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