MacLine ceased trading on Monday night, and senior management is engaged in rescue talks with an unnamed third party believed to be a German-backed firm. Because the company has called in the receivers, representatives cannot discuss the situation with the media. A statement from official receivers, Begbies Traynor is expected today, but details remain sketchy.
MacLine commenced trading in the UK Macintosh market in the 1980s and was one of the first mail-order Mac companies. The original owners sold off their interests to a third party, and emigrated to South Africa. The MacLine brand again changed ownership two years ago.
The company became well known in UK Mac circles, thanks to its active support for the Mac community, and its involvement with the MacExpo and MacFest events.
Policy-switch denial Euler Trade Indemnity (ETI) spokeswoman Rebecca Kools denied that ETI's revised credit coverage follows a corporate decision to withdraw from the consumer-electronics sector. ETI's parent company, Allianz, is believed to be limiting its level of exposed risk in the sector. Kools said Allianz's actions have "no bearing" on ETI's decision. "We operate independently from them," she said.
Kools added: "The events of September 11, plus the general decline in economic activity, both globally and in the UK, mean that all credit insurers are examining their premium levels and exposures. ETI is no exception. This prudent management of risk applies as much to the electronics sector as any other."
She refused to discuss MacLine, saying: "We make our decisions based on private and confidential information which feeds into our proprietary databases, and therefore we cannot comment on individual cases."
ETI is a public company traded on the French stock exchange. Its corporate brochure is emblazoned with the slogan: "We can improve your prospects." Company turnover stands at £160.3 million. Kools agreed that credit risk decisions made by ETI are concluded behind closed doors, and are not open to public discussion. She also confirmed that the PC market remains key to the company, branding it a "core market for ETI".
Credit-risk insurance provides trading companies with protection against bad debt. ETI's decision to reduce its level of risk with regard to MacLine left the company unable to secure the necessary trading capital to remain in business.
Discussing MacLine's collapse, an industry insider observed: "It's another case of a company that can pull together a good marketing campaign, but lacks the systems, infrastructure and financial muscle to truly compete with larger concerns.
"The people to blame aren't just the company, but also the suppliers, distributors and credit-insurance companies that let smaller resellers overextend themselves without considering customers' needs.
"MacLine lacked the necessary financial muscle to survive."
MacLine's collapse comes just one month after that of South London's Mygate. The latter company's assets have been sold to international dealer, Cancom, based in the UK in Guildford. Cancom, formerly Multiple Zones, last year sold a majority interest in itself to giant German reseller Cancom.
With the disappearance of MacLine and Mygate, only a few major players remain in the UK Mac market. These include Cancom, Computer Warehouse, Gordon Harwood, Jigsaw, MacWarehouse and Micro Anvika.
Max Wright, founder of Multiple Zones, issued a stark analysis of the market to Macworld last year: "I think the writing is on the wall for mid-range retailers. You have to be small and niche-orientated, or grow," he said.
ETI's decision to limit its exposed risk, if consistent with those of other credit-risk insurers, warns of increased economic uncertainty across all markets.