New kid on the block

Jim Kuswadi has another approach, formulated by experiences that led him to believe introducing new products is not overly complex.

Indeed, he has introduced products many times as managing director of Sydney Reseller Amtex, whose Power Supplies Division offers hundreds of DC-DC converters, battery chargers, power inverters and other power conversion products to serve the electronics and computing trades.

This side of the business is one of a handful of local companies offering specialist equipment, and Kuswadi rarely has trouble introducing new products. "Usually it is about bringing a brand name to the Australian market," he says. "For example, an Israeli company called Nemic Lambda approached us to bring in their power supplies. We are a well-known power supply distributor so it made sense for the company to contact us, and their products are industry standard so we did not need to do market research."

Advertising, dedicated marketing and free samples were deployed to stimulate the market, until "... we got to a good arrangement in terms of stock rotation and payment terms".

Amtex assumed the risk, but the journey from prospect to profit took just a year. "I was surprised how fast it was accepted," Kuswadi says. "Our reputation in the industry and the fact it was an international brand seem to have given the market confidence."

It also gave Kuswadi confidence to attempt a more daring product introduction, for his Systems and Displays Division that specialises in the sale of components for industrial computers and displays, and also offers services to design and assemble these rugged machines.

Although this division was performing well, Kuswadi felt it needed a growth strategy and found one in an English software product that allows scheduling and distribution of video into multiple PCs.

The product appealed because Amtex’s ability to create tiny industrial PCs and housings that can withstand harsh environments -- the company last year made a PC capable of surviving prolonged exposure to water from a hose -- gave it the idea to use the software to create schedules of advertisements retailers could display in their stores.

As industrial PCs can use touch screens, the in-store units could even become gateways to websites so shoppers could look up detailed product information as they cruise the aisles.

The scheduling systems also offered the chance for retailers to change the advertisements on display at different times of day, a potential boon for supermarkets where weekend traffic and weekday shoppers are very different.

Kuswadi therefore hoped that cracking the market for merchandisers and advertisers would mean plenty of work for building new computers for the Systems and Displays Division, a hope fuelled by the lack of a comparable product or concept in the local market.

"We looked around and found that none of the retailers even knew about the idea, and no-one had it installed," he says. "All that was available was DVDs connected to TVs or a more sophisticated PC-based system. But in both cases their downfall was reliance on moving parts. Our solution, Avisum, is totally solid state."

Despite these advantages, more than a year later Kuswadi is just beginning to see light at the end of the tunnel after a journey made arduous by the fact that Amtex quickly discovered it knew very little about its target market in the advertising industry.

"We are electronics guys," he says. "For us to learn about the advertising industry was too hard," a lesson learned after existing staff failed to make significant inroads with the new product, even after Amtex created a new company called Avisum to disguise its high-tech origins.

"We realised that we needed to get someone from that industry with the contacts and knowledge to take it to market," Kuswadi says, and that person is a dedicated business development manager from the advertising industry with contacts and inside knowledge the Amtex team can only dream of obtaining for themselves. The new manager has labelled the Avisum concept "digital signage", secured trials with some of Australia’s largest retailers and brands and generally accelerated the sales effort beyond Amtex’s own efforts.

"It is very tough being a market maker," Kuswadi concludes, having financed the entire venture from his own pocket. "I expected that in one year we would be off the ground. Now I think it needs another year."

But he is prepared to stick it out and wait now that he sees momentum building behind in the concept of digital signage. "More and more people understand it," he says. "And I am prepared to take the risk because the industrial side of the Displays and Systems Division still has orders. Avisum benefits from having a big brother."

Without that big brother, however, Avisum likely would not have survived its first year. "We have had very little support from overseas principles," Kuswadi says, for Avisum and for other products. "Maybe in consumer electronics there are still vendors’ funds to help. But in our area, nobody wants to know what you spend. It’s your business alone."