Web building business develops

In the first of a five-part series on web development, Julie-anne Sprague talks to some of the Perth industry’s best-known names.

REPUTATION alone won’t save a business in the turbulent web development industry, which is only now showing signs of emergence from a sustained and costly slump.

Many big-name players have faded into the ether while others, including Pretzel Logic, which last month was put into voluntary administration, are experiencing ongoing difficulties.

However the survivors and newcomers are fairly upbeat about the industry. Several developers spoken to by WA Business News say they are busier than ever and anticipate strong growth, particularly in online application development, as companies become increasingly aware of the benefits of web integration.

The integration of software systems and business processes is one of the growth areas identified by developers.

This includes the use of content management systems, customer relationship management tools and other software applications that streamline business processes and allows customers and employees to access and change database information.

This additional functionality adds to the cost of building a website but provides far better returns, developers say.

A basic website can cost as little as $700 (they tend to be a small number of web pages with little if any functionality), however websites generally cost between $2,500 and $7,000, but could cost up to $250,000.

The top 20 web developers in WA Business News’ Book of Lists 2003 (see page 31) include a mixture of big consulting houses with web development departments and smaller operators that have web development as their core function.

There is also the option of ‘budget’ operations, which include one-person operators, and the off-the-shelf or do-it-yourself packages.

The key to getting a good developer is to shop around and to think of the web developer like a designer builder.

While dealing with a backyard operator can bring costs down significantly, according to Internet Business Corporation managing director Richard Keeves, the visionary with the ideas and one-person-show can speak a different language, so results are often flawed.

“A visionary will work with the architect, who translates those ideas from the visionary into plans, plans that a builder can work from,” Mr Keeves said.

“The builder passes on those instructions to the technical people – the tradesmen.” According to Mr Keeves, companies such as his, which have a range of skilful people to draw from, can produce good outcomes.

“If the visionary talks directly to the tradesman they will be speaking two different languages,” he said.

IBC has existed since 1995 and caters to a wide variety of clients, including Australian Institute of Management WA, the Perth Convention & Exhibition Centre, Master Builders Association of WA, and WA Local Government Association.

Mr Keeves said being a local based player offered good advantages in the WA market over bigger multinational companies.

Perth Web managing director Matt-hew Price said the industry had experienced some tough times but his company was now benefiting from good growth in Perth and overseas markets.

“Everyone took damage in 2001, we went through nine months of absolute hell,” he said. “We have now more than doubled our revenues.

“That has come through diversification. We do some specific graphic design and software applications for other companies and we offer web hosting.”

Perth Web provides simple website packages for $699 but Mr Price said the average website was around the $5,000 mark.

“Up to 30 per cent of our income is from overseas and we’ve recently landed a big job,” he said.

Perth Web has recently launched a national name, Web Click, and is looking to attract more national and international work.

Perth Web’s current clients are Tyre Power Australia, RM Australia, Perth International Arts Festival and Belmont Forum.

Vivid Interactive Design and Multimedia is also experiencing strong growth, particularly in online integration, according to managing director Damian Cook.

“We have grown by over 50 per cent a year since inception in terms of revenue,” he said. “And we are on track to do that again this year,” Mr Cook said.

He said the company had recently secured work for Sons of Gwalia, Western Power and Converse, and had existing work with the J Corp Group, Peters and Brownes, Wesfarmers Group, and Automotive Holdings Group.

Businesses integrating their systems online are achieving a competitive advantage, according to Mr Cook.

“Integration is vital in ensuring we assist our clients out-perform in every part of their business, from strategic planning to day-to-day operations,” he said.

While smaller than Vivid, Cube7 is building a growing reputation in the Perth market, according to managing director Jeremy Horne.

“We recently won a project with the Department of Health. It was between us and Pretzel,” he said.

“Branding is so important. The only reason Pretzel was there was because someone suggested them, they had heard of them. They have a very strong name in the market.

“For us, it’s a slow process of building that up.

“The market is turning around now.”

The company, which started operating four years ago, has a client list that includes Evans and Tate, Department of Agriculture, and the Department of Health.

Kuban Empire managing director David Defendi said establishing the company on the tail end of the dot.com crash had helped form a business model that provided quality work at a cost significantly less than those of the multinational players.

 “In terms of the big players like CSC we can undercut them easily. We don’t have their overheads,” Mr Defendi said.

Kuban’s clients include Living Digital, US-based 3Sports and WA Business News.

Some new names are simply a new look, rather than a new direction. Linc Online, part of advertising agency Linc Integrated, was formerly Dotdashslash and started operations about three years ago. The name change came about when Adlink JLS rebadged and better represented the business’s direction, according to associate director Matthew Clark.

“It tells our story better, we are in the business of communicating,” he said.

“We are part of the advertising agency which gives us a massive advantage in terms of design, creativity, and facility wise.”

Linc Online’s clients include Cedar Woods, Subiaco Redevelop-ment Authority, Department of Planning and Infrastructure, and TAFE.