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THE NEXT LOS ANGELES / TURNING IDEAS INTO ACTION : Livelihoods : Success Story : Turning It Around : The Little Company That Could

July 17, 1994

It's an ill wind, as the saying goes. In 1989, the Berlin Wall fell and the downsizing of Southern California's aerospace industry began, with widespread job loss and economic disruption.

But a small business success story also began in El Segundo's aerospace alley. Anita Gabriel and Orie Rechtman, longtime entrepreneurs, bought Wareforce Inc., a software distribution company, in 1989, when it was selling $2 million a year in computer programs to schools and corporations.

They chose to go after business among big defense contractors, suddenly forced to slash costs and eager to listen when Wareforce promised to supply their software needs at a fraction of the cost of their own purchasing departments.

"People would feel sorry when we said we were supplying the aerospace industry, but that was our opportunity," says Gabriel, a San Francisco native who has owned companies in textiles and management consulting in two decades in Southern California.

She and Rechtman, who is her husband, have taken Wareforce to $21 million in sales last year. They anticipate $30 million sales this year and $100 million within five years, says Rechtman, who immigrated from Israel in 1972, graduated from USC in 1975 and started in business importing Italian furniture. He got into computers for home and school use in the 1980s.

Software is developing so rapidly that big organizations want suppliers to anticipate needs and fill them. Wareforce services a customer list which includes Hughes Aircraft, Lockheed, Southern California Edison and the University of California system and USC with only 40 employees. How?

"We're automated," says Gabriel. "Customers order by E-mail and pay electronically, and we can deliver electronically, too. With computers, it costs less to do business these days."

Wareforce has opened sales offices in San Francisco and Atlanta, but the company will grow in Southern California. "Tremendous opportunities are coming in Los Angeles as companies of 100 employees or more will multiply in the next five to six years," says Rechtman.

What companies are those? "We're looking at people laid off in aerospace who have consulting and technology companies with maybe 30 to 50 employees," Rechtman explains. "The growth will come from those independents." Opportunity from adversity, like Wareforce itself.

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