Point One Technologies Inc.
Where: Anaheim
12-month sales: $168.6 million
Two-year growth: 637%
OC workers: 25
Business: wholesaler of overstock, refurbished, other consumer electronics
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The old adage of someone’s trash is another’s treasure has been Anaheim-based Point One Technologies Inc.’s ticket to growth.
The scrappy wholesaler of refurbished computers and consumer electronics buys used or surplus gear from manufacturers and sells it to online resellers such as Salt Lake City-based Overstock.com Inc. and Woot Inc. of Texas.
The company also sells refurbished products to exporters selling to other countries.
“The majority of our growth has been from resellers and exporters shipping electronics to Mexico and Europe,” said Vikas Vanjani, Point One’s president.
Point One ranked No. 6 on the Business Journal’s 2009 list of fast-growing private companies with sales growth of 637% for the two years through June 30.
For the 12 months through June, Point One had sales of $168.6 million, up from $23 million for the same period in 2007.
The company is the largest by yearly sales in our list’s top 10.
Point One’s products run the gamut from disk drives and computer memory boards to flat-screen TVs and video game consoles.
“Gaming products are doing very well for us right now,” Vanjani said.
The economy has been a boon for the company, which has seen consumers change their spending habits and become less wary of refurbished products.
In the past, there was something of a stigma associated with products labeled refurbished. They were believed to be defective or less reliable than something new and out of the box, Vanjani said.
These days consumers are more willing to buy something refurbished when the price is discounted, he said.
“In today’s economy we’re seeing consumers concerned about price but still wanting that big LCD TV or laptop,” Vanjani said. “Refurbished is a new way of affordability.”
Point One buys new, overstocked products or factory refurbished gear.
“What I deal in is typically what you would see in the used car market when you buy certified pre-owned vehicles, but with electronics,” Vanjani said. “All of our products are backed by a manufacturers’ warranty or service center warranty.”
The niche wholesaler has seen business grow by selling more products.
In 2007, Point One did $47 million in sales as it just began to get into the computer products market, including printers and monitors.
“Our capital is growing and good bank lines of credit simply allow us to buy more,” Vanjani said. “And in my business, cash is king.”
The refurbished wholesale business is a far cry from what Vanjani went to school for.
An electrical engineer major from the University of Southern California, Vanjani started out working in an engineering field department with his father after graduation
“It wasn’t for me,” he said. “I wasn’t cut out for it.”
With the help of some family friends overseas, Vanjani started selling computer products—mostly circuit boards with memory chips—to resellers.
The company grew with high demand for memory products in 2004.
“Memory was a cash flow generator for us,” Vanjani said. “It’s very high dollar to sell, but very low margins per item.”
Point One began to get involved in other computer components.
“At the time I was only selling to other resellers,” Vanjani said. “I wasn’t dealing in whole computers, only the parts.”
The business expanded into LCD monitors and printers
A contact handling refurbished products for Palo Alto-based Hewlett-Packard Co. pointed Vanjani to the consumer electronics side of the business.
“We started looking for any refurbished product that had any manufacturers’ warranty behind it,” he said.
Most of Point One’s products are bought directly from manufacturers with their warranties behind them.
When a product is returned to a retailer for whatever reason it often is shipped to a manufacturer’s service center where it is examined, fixed and sold at a discount.
“They have a B-goods list that goes out every so often to people like Point One who can buy the quantity,” Vanjani said.
The company turns around and sells products through several big resellers including Freemont-based ASI Computer Technologies Inc., San Jose-based MA Laboratories Inc. and Oceanside-based Genica Corp.
“All the big companies you hear about are kind of incestuous to us,” Vanjani said. “We buy and we sell, oftentimes ending up a customer and a supplier.”
The company started its own Web site—UncleVic.com—a year ago. There, consumers can buy directly from Point One.
The Web site on average does about $100,000 to $150,000 per month in sales and is expected to hit its $1 million mark this month, according to Vanjani.
Point One runs most of its business out of Anaheim at a 15,000-square-foot warehouse where it stores and ships most of its products.
“We do all of our logistics out of the space, so you can imagine there are times when it gets quite hectic,” Vanjani said.
The company runs a sparse ship with 25 employees in Anaheim.
“Everyone wears five different hats and does a ton of different things,” Vanjani said.
