ChannelLife NZ - Exclusive: Distribution Central NZ's $631k profit

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Exclusive: Distribution Central NZ's $631k profit

Director Nick Verykos has told The Channel that the firm's focus will now be placed on existing distribution partnerships with no new vendors planned.

The New Zealand arm of Australian-based distributor Distribution Central isn’t at all worried about the merger of Datastor and WestCon in NZ. “We aren’t focused on what our competitors do badly, but what we do well for our partners and vendors,” said Director Nick Verykos.

Rumours swelled recently that the company was pulling out of the NZ marketplace, but this seems far from the reality. Late last year Richard Crabb (previously with Network Pro) joined the local team as Country Manager and additional team members now support him in the company’s central Auckland office.

While the company is expanding into Singapore and China, the expansion phase of the local branch does seem to be over. With no new vendors planned, it seems a period of consolidation is on the cards, with renewed energy for existing distribution partnerships including F5 and Fortinet plus new focus on Avaya.

The company has swung from a $25k loss in FY08 on turnover of $2.5 million to a $631k profit in FY09 on turnover of $3.1 million. Even though the company’s wage bill increased from $232k to $333k, the administration expenses reduced by $106k and gross margins nearly doubled to 36%, which compares favourably with 19% from Westcon and 12% from Ingram Micro.

The company ended the FY09 period with $201k of cash in the bank and virtually no inventory, as stock is sent overnight from their Australian offices.

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