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Get IT out of town: running a tech company in a regional area

Get IT out of town: running a tech company in a regional area

The benefits outweigh the drawbacks

Jeremy Attwood and Kannyn MacRae outside Belkin's head office on the NSW Central Coast, about an hour and 30 minutes north of Sydney.

Jeremy Attwood and Kannyn MacRae outside Belkin's head office on the NSW Central Coast, about an hour and 30 minutes north of Sydney.

The IT industry has been long associated with large cities and a fast-paced, modern lifestyle. But what about regional areas? What is like running a tech company outside the metropolitan rat race? TechWorld profiles three companies which have seen success by basing their operations on the NSW Central Coast, about an hour and a half north of Sydney.

ADC Krone

Telecommunications and IP network cabling manufacturer ADC Krone is based in the Central Coast suburb of Berkeley Vale and employs some 200 people. Marketing manager Sarah Bishop said the company has been an Australian manufacturer for 25 years, but early on the business was based in Sydney's CBD as an importer of products from Germany.

“When the decision was made to manufacture locally, we established our production facility on the NSW Central Coast,” Bishop said. “There were a few areas considered both south and north of Sydney. Part of the reason that the Central Coast was selected was due to a government grant which offered a subsidy for businesses relocating to the Central Coast.”

Bishop is unable to quantify the cost differences between Sydney and the Central Coast for running an office and manufacturing facility, but believes freight costs are more expensive due to the greater distance to the regional transport depot.

ADC Krone owns its facilities rather than rents them which Bishop says is cheaper.

In terms of communications facilities, Bishop says ADC Krone is at a disadvantage compared to city-based businesses as there are not adequate fibre connections at a competitive cost. However, new businesses are being built on the Coast, some of which do have the new fibre links, and there are no problems with power.

As for finding staff in a regional area, ADC Krone gets no shortage of applications.

“We are often overwhelmed by responses to job ads, we think this is due to our relative proximity to Sydney,” Bishop said. “We have a wealth of candidates to choose from as they can choose not to commute to Sydney. We even find that individuals with higher levels of experience are applying for lower level jobs. It's about lifestyle versus career.

As for the disadvantages, Bishop says it can be difficult to access technical resources.

“We often are charged additional costs for travel for engineers. This does add some cost.”

Belkin

Multinational IT product manufacturer Belkin has based its main Australian operations on the Central Coast after an acquisition of a local business eight years ago.

Managing Director Jeremy Attwood said a move from Gosford to Tuggerah (both on the Central Coast) in 2006 enabled the company to have a facility comparable to any found in the capital cities.

“Our 10,000 square foot warehouse could have been in Western Sydney, but we wanted to base ourselves in Central Coast,” Attwood said.

Belkin has 95 staff in Australia with 70 in Tuggerah.

Attwood is also unable to make a direct cost comparison between the regional Central Coast and a capital city, but he does not believe it would be a significant difference.

“It would be difficult to get a similar size operation in Sydney,” he said, adding the land cost on the Coast is cheaper.

Belkin has no problem with the facilities which are “no different to anywhere else” and its telecommunications links are with “large suppliers”.

“We have a direct link to Hong Kong and we are in Tuggerah Business Park so we have the facilities we need,” Attwood said. “There are probably areas around the Central Coast where it would be difficult. We run VoIP to our regional offices, but most telco costs are with mobile phones so it is the same cost as it would be in Sydney.”

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