Convergence the key for LEC

Buying group, Leading Edge Computers, is motivating its 134 independent reseller stores to take on the emerging IT and home entertainment convergence market - spurred on by the success of a new concept store in Armidale.

The group is encouraging its member stores to follow the lead of mass merchant retailers such as Harvey Norman, Bing Lee and Dick Smith, retail chains that have recently launched specialist "digital home" convergence stores to tackle the emerging market.

One of the first LEC stores to follow this lead was McDonagh Computer Services in Armidale - which has moved to new premises within a central shopping area and undertaken a top-down refit in order to focus on the PC convergence market. The store sells a mix of computers, phones, internet offerings and office equipment.

After 40 days of trading, shop owner Dave McDonagh said the decision had paid off - sales had quadrupled.

It was a decision to update from being a typical country reseller, he said.

“We’re moving away from being a technical type of computer store to being retail orientated,” he said.

The shop now focuses on displaying a range of computer systems in a showroom style, he said. Along with notebooks and printer set ups, the shop also boasted wireless setups, including a digital projector connected to an Xbox console.

Resellers were learning valuable lessons from the success of mass merchants in the home entertainment convergence space, LEC general manager, Ross Whitelaw, said.

“If stores don’t upgrade their standards of presentation, they won’t grow," he said. "Look at the continually great job Harvey Norman are doing,” he said. “And now Dick Smith are doing it with their Powerhouses.”

Technology convergence is the major theme of Leading Edge Group’s four-day reseller conference in March. By bringing together traders from Leading Edge’s computing, telecoms and internet groups for the conference, the vendor trade show would be able to address the convergence market.

For more on this story, see this week's edition of ARN.