The PC Company, the country's largest PC assembler, said in a press release yesterday it was ceasing trading temporarily as it undertook restructuring, which it hoped would be complete in a week.
"No, I haven't heard from Colin [Brown, managing director of The PC Company] yet, but in the press release he says he's confident he'll open the doors again," CMANZ chairman Peter Shirley told Computerworld Online.
However, in a CMANZ press release, Shirley uses less optimistic language.
"The recent demise of The PC Company is tragic given the long and successful history that it’s founder Colin Brown has had in the local industry."
Shirley remains hopeful that Brown can re-launch the company following any restructuring that takes place.
Brown helped establish CMANZ in 1999 following the failure of another local assembler. The organisation was established to stand behind member companies' hardware warranties in the event of their liquidation.
Brown closed The PC Company offices on Friday, asking staff to conduct a full stocktake, according to an employee who did not wish to be named.
"On Monday he took the keys off everybody and that's that."
Rumours about the company's financial troubles have been circulating for the past fortnight after it was revealed it was moving out of its Auckland showroom without having secured a lease on a new property.
Efforts to speak to Brown have been unsuccessful. However, in a written statement, Brown says "It is no secret we have had a tough 12 months, where sales have continued to decline ... We have also been in negotiations with a major New Zealand retail chain to supply them with large volumes of PCs, but these negotiations have stalled."
Brown refers to the closure as temporary pending the restructuring of the company, understood by Computerworld Online to centre around plans to retain one retail store in Hamilton.
The PC Company had seven retail outlets around the country, in both large centres and small. It also runs PC Connect, a virtual ISP which will continue to provide service to customers in the foreseeable future, according to Wave Internet's marketing manager Wayne Attwell. Hamilton-based Wave Internet provides the PC Connect service.
"We won't be cutting any customers off, that's for sure." Attwell says Brown hasn't been in touch with the ISP yet, but he's confident he will be.
IT market researcher IDC says The PC Company's popularity peaked during 2000 to 2001, when it accounted for as much as 10% of the consumer PC market, according to analyst Alysha Buckley.
"It got up to number two behind Hewlett-Packard."
Today's New Zealand-based manufacturers account for a much smaller slice of the market. The three largest companies left are Arche Technology, Insight and PB Technology. However, none are able to rival The PC Company's sales.
Buckley says the market has been particularly tough for local manufacturers for several reasons.
"The PC Company never really moved outside its niche consumer PC market, which left it vulnerable."
It faced intense competition from foreign giants HP and Dell; and the growing laptop market has also eroded desktop PC sales.
Meanwhile, Napier-based The PC Company (HB) will continue to trade unaffected by Brown's move, according to managing director Russ Olsen.
"We moved some time ago to dissociate ourselves from it as a major supplier, when we became disenchanted with its changes in support policy, and other matters that concerned ourselves."