Commander’s partners react to its demise, we ask what went wrong

After more than 25 years in business, local integrator Commander recently went into administration, leaving behind numerous industry partners.

Last month, in a statement issued to the ASX, Amanda Lacaze, Commander’s managing director and CEO, said the administration announcement was made “with
great regret.”

Steve Sherman and Max Donnelly of Ferrier Hodgson were appointed as joint voluntary administrators for Commander and its subsidiary companies. The appointment follows a request by Commander to stop trading of its shares. Shares were trading at just $0.082 at the time of the halt.

Receivers Peter Anderson, Chris Honey and Joe Hayes of advisory group McGrathNicol have been appointed by Commander’s lenders after a decision not to further extend the period for repayment of their facilities.

“It is the receivers’ intention that all current Commander services will continue uninterrupted whilst the sale process is undertaken, and that all Commander customer needs continue to be serviced,” said Peter Anderson, partner at McGrathNicol in a media release. “There are no plans for major structural changes to the business while the sale process is underway.”

With pre-tax profits for the financial year falling short of its forecasts set in late January, the company has been battling mounting debt and increasing pressure from its creditors.

A recent move to shift its Affinity IT Recruitment business fell through when Commander was unable to secure a purchaser.

Some of the associated companies involved in the appointment include RSL COM, Unitel Distribution, IPEX ITG, iBurst, LSP Communications, Axon Computers, 1410 Communications, Rocfo, Call Australia, Unitel Distribution, NewTel Services, Fixed Wire Holdings, Budget Telecom, SC Communications, the Volante Group, Direct Collection Services and Multelink Services.

Mark Stevens, president of Nortel A/NZ, told CRN the vendor “regrets what’s currently happening with Commander” and hopes for a quick resolution."

“In the meantime our customers and nPower channel partners can be assured that Nortel will continue to provide support as required. We’re monitoring the situation and as far as we’re concerned it’s business as usual for Nortel,” said Stevens.

This week we ask two more of Commander’s partners: “Why do you think Commander failed and how will its demise affect your business?”

Diagnosis 1

Paul Scanlan, General manager, IPL Communication

It is sad to see Commander in administration – nobody likes to see a business fail – but as an outsider it wouldn’t be appropriate for me to comment on the company, its management or the reasons behind its demise.

We are in interesting times and the global economic downturn and credit crisis has brought unexpected results for highly geared companies close to home, though the Australian economy continues to enjoy a positive business environment.

The issues surrounding Commander will have no financial impact upon IPL Communication, as our debtors are all insured. We do not see any negative implications on our business and will continue to focus on delivering the best products and service to our business partners.

In some way recent events present new opportunities for our channel to reach out and ensure the market is covered. We will continue to support any customers seeking alternative communications solutions and service through our extensive business partner network, including Commander.

We are fortunate that IPL continues to grow and expand our offering to deliver the best communications solutions and support to our channel. In these generally challenging economic times, resellers need to focus on the end game – looking at how they can deliver a better solution than their competitor.

So our partners can expect us to continue to bring together the best of breed communications technologies to enable them to differentiate their offering.

We recently signed agreements with companies including NMS Adaptive and ADDCOM to expand our product portfolio, and we continue to develop our unique technical services to ensure our partners have access to the best products and support to deliver the best solutions.

Diagnosis 2

Eric Hampel, GM, Siemens Enterprise Communications A/NZ

The circumstances around a company being placed into receivership are always complex, and this has been no exception for Commander. While there are a number of factors that contributed to its fate, time was ultimately not on Commander’s side.

Unfortunately with market conditions as they are, Commander’s life-line was cut short. It was with some surprise that we heard the news on 8 August that Commander had appointed voluntary administrators.

The management team headed by Amanda Lacaze had demonstrated the know-how to turn the business around and given time, we had every faith it would achieve this, and still could.

Having been in partnership with Commander for more than six years, we saw a significant change in the business following the implementation of the new plan in January 2008.

Our primary focus now is on understanding what this means for our customers and doing our bit to ensure the fastest and best resolution possible, with the best interests of our customers top of mind. Commander currently supports approximately 2000 enterprise and SME customers in Australia on behalf of Siemens Enterprise Communications.

In terms of how this will affect our business, it is really too early to say. The best outcome would be a quick resolution and continued relationship with Commander under new ownership.

In this scenario, there would be little or no impact for Siemens Enterprise Communications and our customers.

In the meantime, it’s business as usual, so much so that we continued technical training for franchisees supporting our recently launched HiPath Open Office Unified Communications solution for SMBs.