Communications integrator NSC Group is regrouping after a difficult entry into the local market.
The Australian-headquartered firm crossed the Tasman mid-last year under country manager Mark Wallendorf, establishing offices in Auckland and Wellington.
When it was set up locally, Sydney-based managing director Craig Neil said the company’s aim was to achieve revenues of $15 million from its New Zealand business by July of this year.
However, for the financial year to June NSC turned over slightly more than $1 million locally, posting a gross profit of nearly $464,000 and an overall loss of $723,000.
Neil says the acquisition of Sun Microsystems by Oracle (agreed to in April) was the main reason behind the revenue shortfall.
“We started with the Sun business in Australia and New Zealand and hoped the New Zealand Sun business would return around $10 million. But Oracle acquired Sun after we announced that [$15 million target] and they decided to have a direct play in New Zealand. That revenue got removed.”
NSC also fell below expectations in its voice, unified communications (UC) and datacentre financial targets for the year to June, says Neil.
“We were hopefully targeting around $5 million with voice, UC and contact centres and we did not get anywhere near that. Our results have not been pleasing, but what is pleasing is the engagement we have been getting.
“We are focused on contact centre growth in New Zealand, but we are selling [the systems] from Australia. They are deployed locally to New Zealand businesses, but it is reflected in the Australian profit and loss.”
However, Neil is encouraged by local activity in the contact centre market, saying NSC has deployed more than 30 systems in that sector here in the past year.
“We have found it hard – we have to earn our stripes and we are still doing that. We have done a lot of smaller projects and none of them have gone badly, we are just a new entity. It is already a crowded market and not a very big market.”
The company now has a three-year plan to be a $7 million to $8 million business in New Zealand, says Neil.
Part of the strategy will involve beefing up its mid-market plans in New Zealand, Queensland and Western Australia.
It will launch new managed services in these regions next February, Neil adds.
The company also plans to expand its technical services team from two to four by next June, bringing the total staff here to 10. It also has local sales and marketing staff.