Is Cosmos Computers A Good Idea?

Cosmos Computers

In the face of its dwindling fortunes, Coscharis Group is taking a different direction by starting of up Cosmos Computers. The company is looking at diversifying its business from overtly dependent on automibile distribution, assembling and marketing.

The announcement that it has received the authorisation of the National Information Technology Development Agency, NITDA to manufacture Cosmos Computers is an interesting one given the fact that the company laid off about 208 staff in August.

No doubt about it, Coscharis Group has been successful in the automobile industry. The company is only rivaled by Elizade Motors, the largest distributor of Toyota vehicles in Nigeria and perhaps West Africa. However, going into the manufacturing and marketing of computers is a different kettle of fish.

The country already has casualties of companies who ventured into the assemblage/manufacturing of computers and computer products. Omatek Computers is a classic example of an indigenous computer maker that ended up becoming bankrupt without a respite. Stanley Ekeh, the CEO and Founder of Zinox, recently threw in the towel by closing down Zinox Computers and converting it to Yudala, a brick and mortar plus an eCommerce store.

No doubt about it, Coscharis Group and just like any company for that matter has to innovate, adapt to new challenges and create fresh market, however,there are brutal headwinds in the market that will require a carefully-crafted execution of such plans.

For Cosmos Computers to succeed, the company must learn from the failures of Omatek and Zinox Computers. A major challenge that confronted these two companies were peculiar and systemic. Computer manufacturing business are volume driven. The demand for volume must be assured for such enterprise to succeed. Omatek and Zinox could not really get the volume that will make their margins shore up their bottom line. In general scheme of things, these companies were importing more than 90% of all component used in their production, the moment there are Forex issues, the company is susceptible to all sorts or losses and risks beyond its control.

Therefore, Cosmos Computers should learn from these two case studies.

As an advice: instead of going ahead to produce these computers, why not test the waters. Do prototypes and run a pre-ordering programme. Just like what Tesla and many other successful companies have done. If this is properly executed, Choscharis Group will be able to know what it should make, how, when and why.

The plan of quickly deciding to produce ‘low-end, mid-end and and high-end’ devices is like jumping the gun. For all it is worth, there is no perfect time for Cosmos Computers than now, but the company must see the move as a humbling journey and take things step by step.

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