Now there’s a new outfit in town, says Penny Sleuth UK editor Tom Bulford. It’s called Nerd Force. And Tom reckons it’s a good buy.

Nerd Force is owned by by Nexus Management (LON:NXS), a small UK company whose shares trade on AIM at a price of just 0.8p. It also have twenty years of IT experience. If NXS can handle the roll-out successfully, its shares can only rise.

All who have a computer need some help from time to time, and for those of us who rely upon it for our livelihood a swift and reliable service is absolutely crucial.

994 in Minnesota, Geek Squad is now owned by US electronic goods retailer BestBuy (NYSE:BBY). Another American national retailer, Circuit City (NYSE:CC), has its own service arm, Firedog.

Now a new name is to be rolled out across the USA. It is called Nerd Force, and it is owned by Nexus Management (LON:NXS), a small UK company whose shares trade on AIM at a price of just 0.8p.

Nerd Force was born in 2003 in Staten Island and now has a fleet of yellow vans out of which leap willing technology specialists ready to fix PCs. Nerd Force is now looking to franchise the business across the USA and overseas, and it starts with certain advantages.

The first of these is that neither Geek Squad nor Firedog are franchise operations, but are instead closely tied to the retail operations of Best Buy and Circuit City.

Geek Squad no longer fix computers on site but instead send them to a factory somewhere in America, from which they take a fortnight to return. As Roger Richardson, the CEO of Nexus, observes, ‘not many small business people could operate without their computer for two weeks.

The second advantage that Nerd Force will have relates to the history of Nexus, and to a deal that it struck with another US retailer of electronic goods, the Los Angeles based PD Financial.

Nexus has been around for almost twenty years, starting out as supplier of e-mail solutions for small and medium sized businesses throughout Europe. Since then it has added a number of other services, such as remote server management, disaster recovery, data storage, a help-desk, desktop support and wide area network management and monitoring.

With a data centre in Maine, USA, and another office in Dornock, Scotland, it can offer its services worldwide complete with round the clock telephone back-up. Traditionally Nexus has targeted small businesses, especially those operating in more than one country, but in 2006 it bought a 24% stake in PD Financial.

It’s got access to a good list

Trading as Peach Direct, PD sells electronic goods and other such luxury items as jewelry and golf clubs. It has no stores, but sells only through mail shots and its on-line channel, offering finance packages to those with a carefully vetted credit status.

The attraction for Nexus was the forty thousand or so PCs sold annually by PD. In the first year of the partnership customers for twelve thousand of these also decided to buy support from Nexus.

These were valuable extra customers for Nexus, but they were also typically private buyers who need help with the PC at weekends, in contrast to the traditional business customers who call the Nexus help desk in the week.

In February of this year Nexus sold 72% of its stake back to PD’s owners for $5m, netting a profit of £1.15m on the deal. However, the two have maintained their business relationship and it is with the encouragement of PD that Nexus have decided to buy Nerd Force.

What PD has found is that many of its customers, not only for PCs but also for items like flat screen TVs, would willingly pay extra for somebody to come and install them. So PD would like to have a relationship with Nerd Force, while Richardson sees the chance to combine the on-site service of Nerd Force with its existing remote back-up service and offer an attractive, comprehensive and good value proposition to small business and private customers.

Although the immediate plan is to franchise Nerd Force across the USA, there have already been enquiries from potential franchisees in India, Brazil and Europe and Richardson believes that Nerd Force could become a dominant force in the fragmented market of franchised IT support.

In spite of this appealing strategy the share price of Nexus has been weak of late, no doubt reflecting the retailing climate in the United States, as well as a renegotiation of payment for the sale of the stake in PD, involving a delay of two months in the payment of $2m, now due by the end of August.

Nexus has said that ‘in the event that PD is unable to pay …a charge of $100,000 per month will be levied’ – stiff terms between two business partners. The City is clearly looking for this to be resolved and for evidence that PD is countering the tough economic environment in the United States.

Beyond that there is the roll out of Nerd Force to consider. With established names already in the market place this is an ambitious plan. But with Nexus valued at just £7m the share price of Nexus is not taking a lot on trust. This is definitely one to watch.

Source: Peaches and Nerds

Sofa retailers have been hammered. Anyone involved in selling ‘big ticket’ items, such as white goods (fridges, freezers, etc), has seen their share price tank too. Meanwhile, Homebase owner Home Retail Group (LON:HOME) warned that like-for-like sales at the home improvement chain had fallen 12% in the 13 weeks to May 31st.

But it’s also claiming some surprising victims. Carphone Warehouse (LON:CPW) took a pounding yesterday as it warned that broadband growth would be slower than it expected this year. Why? Because if you’re not moving house, there’s usually no impetus to go to all the hassle of changing your broadband provider.

But the property crash is far from being the only thing consumers have to worry about…

The house price boom has meant good times for retailers. Homeowners have been borrowing more money against the rising value of their homes (mortgage equity withdrawal), and then spending it on the high street.

But now that house prices are falling, the amount of equity left to withdraw is falling sharply. On top of this, lenders are now demanding that remortgagers have as much equity as possible in their homes, if they want to get decent rates on their home loans.

This can only be bad for the high street. Mortgage equity withdrawal fell from £13.7bn in the last quarter of 2006 to £7bn in the last quarter of 2007. Bear in mind that house price growth hadn’t even turned negative by that point. So MEW for the first half of this year will plunge again.

It’s not just about the amount of money people can borrow against their homes. It’s about confidence as well. Anyone who owns a home – even those with a reasonable equity cushion – is thinking: “how bad is this going to get? I’d better build up some savings, or pay a bit more towards the mortgage.”

And anyone who at some point in the last decade has said: “my home is my pension”, is now terrified that they will be spending their dotage living on baked beans and sleeping in soup kitchens. Suddenly that new widescreen plasma TV seems very much a luxury, not a necessity.

And they’re right to be worried. As Phil Dorgan of Panmure Gordon tells The Times: “The British consumer is more geared to house prices than almost any consumer in the world. There’s a high level of consumer debt as a proportion of GDP – if home prices fall it absolutely affects consumer spending and if we move into negative equity it will get even worse.”

All bad news. Hopefully if you’re a regular reader, you won’t be invested in any of the consumer-facing sectors (such as retailers) that have been battered in recent weeks. But even if you are, it’s not too late to get out – there’s plenty of scope for further falls.

Because, it’s not just about falling house prices anymore. Property prices may be tumbling, but the cost of everything else is going up. And consumers are very aware of it. The Bank of England’s quarterly inflation survey showed that the average consumer believes that annual inflation was at 4.9% in May. In February, they thought it was 3.9%. The Retail Price Index (RPI) shows that inflation is actually at 4.2%. And the official figure – the Consumer Price Index, which the Bank is meant to keep at 2% – is only at 3% so far.

This is a big worry for the Bank. For a start, it’s the highest that consumers have perceived inflation since it started conducting the survey in 1999. That’s no surprise really – the past nine years have seen China swamp the world with cheap goods, offsetting the central banks swamping the world with cheap money, so we haven’t seen inflation in all the places we’d normally expect to see it.

But now that we are seeing inflation rear its ugly head, the problem is that consumers will start to want more money from employers to compensate. Now the fact that the economy is heading into a downturn will offset some of that pressure – it’s not that easy to get a pay rise if you’ve got the threat of redundancy hanging over you – but it doesn’t simply mean it will go away.

The unions for one thing, have got their teeth into the idea, and not just in the public sector. The strike by drivers for oil giant Shell just goes to show what happens when you have a combination of weak government, a collapsing economy, and workers in positions of power.

But even if wage inflation doesn’t become an issue, the perception that life is becoming more expensive is even more bad news for the high street. If people are increasingly worried about stockpiling the necessities of life before they become even more costly, then they won’t be keeping money over to pay for luxuries.

That means all those second-line consumer-dependent stocks are also heading for trouble. The travel industry? Forget about it. This idea that they will somehow resist the downturn is laughable. Hotels, tour operators, airlines – I’d sell them all.

When the banking sector ran into trouble last year, the papers ran page after page of articles talking about how banks were an undervalued bet for ‘brave contrarians.’ All those ‘brave contrarians’ who bought the hype were then faced with collapsing rights issues and soaring mortgage arrears.

Expect to see similar articles about retail stocks. Just remember what happened with the banks, and ignore them.

At some point in the future, things will get better. At some point in the future, it’ll be time to go bargain hunting. But that’s a long way off from here.

Turning to the wider markets…

Overnight in Asia, Japanese stocks rallied 0.6% as the Nikkei 225 added 85 points to end at 13973, but in Hong Kong, the Hang Seng declined 0.8% to 22833.

Brent spot was trading this morning at $136, while spot Gold was at $870. Silver was trading at $16.52 and Platinum was at $2038.

In the forex markets today, sterling was trading at 1.9435 against the US dollar and 126.17 against the euro. The dollar stood at 0.6491 against the euro and 107.95 against the Japanese yen.

Source: The Stock Market Sectors You Should Sell Out of Right Now