Logical Systems has returned to its core strengths to keep business on track during the recession, providing technical support for a loyal base of business customers built up over 15 years.
CEO and managing director Daven Naidu has been in the local Apple business since he began repairing and servicing machines at CED Distributors in the early 1980s, then the sole local Apple Computer distributor that would later become Renaissance.
As with Naidu, each of the six staff at Logical Systems is a technical specialist and last May he decided to focus on this aspect, rather than continue down the retail path.
“We looked at ourselves and saw what we were all about and where we started. When things get tough, you have to go back to your strengths and we went back to where our business grew from, which is concentrating on service and support and looking after our client base, rather than just going out and chasing after more sales,” says Naidu. “It happened at the right time, because I didn’t know the recession would come.”
He had previously considered opening new retail premises away from its current location on the fringe of Auckland’s CBD. However, it decided technical support for commercial organisations was the best way forward and closed its showroom, reducing the number of staff from 15 to six.
Having bought its own premises in 2003, the company was able to offer part of the office space to commercial tenants.
Logical Systems hasn’t always been in its current Eden Terrace location, though.
After CED, Naidu became service and support operations manager for CDL Systems, which also subsequently became part of Renaissance.
He spent five years there before establishing the Logical Systems business in Orewa in 1994.
However, as the client base grew, it was increasingly centrally based, so the company opened a second office in Takapuna in 1995. It then replaced both with premises in Ponsonby in 2001. The move to its own premises at the Eden Terrace location was made in 2003.
The following year, Naidu saw a gap in the Apple supply market in Fiji and secured sole distribution rights there.
Logical Systems Fiji has resellers in the country, one of which supplies duty-free stores and resorts. Logical Systems itself directly offers Apple products to educational institutions and government agencies in the island nation.
Naidu says business there “went fine” and was growing until Frank Bainimarama staged a coup against the elected Fijian government in December 2006.
“Things slowed down then. Business hasn’t grown, but it has maintained,” says Naidu, adding he is waiting for long-term stability in the region before making further investment in the business there.
Apple’s investment in its brand, through concept stores replicated here by Renaissance and its Magnum Mac chain, and the Apple online store have been positive and negative for Logical Systems, says Naidu.
“The more people talking about the brand the better, so the [concept] stores are a plus in terms of branding, but it doesn’t help that sometimes [customers] can get stock from the Apple store when [they] could get it from us. Sometimes our customers will go and buy from the [Apple] store.
“We concentrate on the service business so sometimes we tell customers to buy from the store and we do the installation. Obviously you want to have the hardware business, but at times the stock situation is a problem.”
The New Zealand and Fijian businesses now each have day-to-day managers, allowing Naidu to step back into a technical consultancy role.
The keen golfer wants to get out onto the greens more and to explore new business opportunities. He says these will probably still be in the IT industry.