TC Computer Company Finds 'New Frontier'
Dec. 6, 2010
Traverse City-based Frontier Computer Corp. has discovered a potentially giant, global revenue source for its warehouse full of tens of thousands of computer components.
Every day, Frontier's 35 employees are buying and selling new and used computer systems and equipment from and for companies worldwide. But over time, some parts just seem to accumulate in the company's giant Traverse City warehouse. The company sells what it can to commercial customers, then eventually scraps and recycles the rest.
Then came the idea: what if Frontier put all those parts for sale online for a global community to see and buy, and what if they were showcased on the world's largest online marketplace? That's right, Frontier has gone eBay.
"We're balancing the market life of these products," explains Frontier CFO John Matthews. "In the U.S., maybe you couldn't give a certain part or old computer away, but in Chad or Thailand? There's value and demand, and we happen to have, say, 700 of them. So, we're able to sell off these older parts, reduce the footprint in our warehouse, and make space for new gear without having to spend $1 million to expand our warehouse."
Parts being listed on eBay include computer memory, hard drives, power supplies, phone systems, printers, servers, and more. One of the best-selling items so far has been a load balancer (used to evenly distribute workload among several computers on one network).
Evan Kiley and Matt Demitz have been tasked to lead Frontier's 'eBay initiative,' one that Matthews hopes will soon result in some 5,000 different items listed for sale and a recurring revenue stream.
"Financially I'm watching this grow day over day," Matthews says.
Kiley says the early numbers are very encouraging.
"The page views of our eBay page is growing 55 percent a month," he says, adding that once an eBay buyer discovers they're dealing with a global computer systems expert, they often come back for more help or equipment, which is feeding Frontier's other divisions.
Moving more items out of the warehouse has led to a complete reconfiguration of the space. All parts are being cataloged, barcoded and stored by category, a process that will lead to improved efficiency, speed when locating an item, and a 45 percent overall warehouse space savings.
Adds Matthews, "This has been like seeing something shiny buried in the sand, doing some digging, and finding out it's actually a new Corvette. We're really onto something here."
To check out Frontier's new eBay store, click here.
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