EKWB in trouble. Is this the end of the European manufacturer?
The pool of European PC hardware manufacturers may soon become smaller again. This time, EK Water Blocks, present on the market for 21 years, is having problems.
There are a lot of companies on the computer components market, but many of them only stick logos on ready-made products from China. There are few real producers who design and/or produce their own equipment. And in Europe even less. The exception is Polish GOODRAMgerman Thermal Grizzly or Slovenian ECWB.
EKWB lost financial liquidity
However, it seems that the last mentioned company has a big problem. EK Water Blocks ran into financial problemsand arrears to employees, suppliers and subcontractors have been going on for months.
Gamers Nexus, which highlighted the matter, is based on reports from former and current EKWB employees and companies cooperating with Slovenians. Among the allegations appears no payments for 2 to 4 monthsno raises paid for the year, unpaid overtime or no payment for orders.
Not all of the “witnesses” are anonymous. One of them – Dan Henderson – shared his experiences publicly on the LinkedIn platform. EKWB reaction? The lawyers sent a cease and desist notice.
What is the source of the problems? EKWB has too large a portfolio, targeting too niche a market. We are talking about specialized components for proprietary liquid cooling systems. Currently, there are approximately 230 water blocks, 40 sets, 85 reservoirs, 40 pumps, 73 radiators and 212 various accessories.
And here we come to the second problem – despite being on the market for 21 years, EKWB does not have its own production plants. Thus, Slovenians are limited by the MOQ they order more equipment than they can sell quickly. Therefore, the company ends with millions of dollars worth of surplus goods in warehouses, being unable to pay five-figure bills.
As if that was not enough, EKWB has communication problems. Especially when it comes to the European and American branches. Employees simply don't like each other, Americans were regularly called “lazy”, there were accusations of theft, and the company reportedly failed to pay Texas state taxes and instead closed its office and warehouse, which employees learned on site.
What now? EKWB, having learned about the investigation, apparently tried to settle the outstanding payments, and there was even a rumor about considering selling one of the company's buildings. We are also talking about changes in the company's management, among others the return of founder Edvard König to the role of CEO and financial controller.
Theoretically, this sounds like a solution to the problem, but… despite the lack of financial liquidity, Slovenians announced their presence at Computex 2024. The company has to have its entire stand, which is an expense of thousands of dollars. Is this really more important than paying off creditors?
