CASHING IN ON CHANGE : FIRMS MAKE HAY WITH NEW RULES, NEW TECHNOLOGY.

Byline: Michael White Associated Press 

John Streep looks at the turbulent telecommunications industry and sees nothing but opportunity.

Sales at his New Jersey company, Furst Group Inc., grew by a staggering 42,000 percent in four years because he catered to small businesses' need for cheap long distance service.

It's just one way in which new technology and deregulation are making telecommunications a fertile field for upstart companies like Furst.

``There's a hot field out there. You've just got to find your niche in it,'' says Streep. ``There's big opportunity. It's getting bigger.''

Furst's performance put the company at the top of Inc. magazine's 1995 list of America's 500 fastest growing private companies, which measures company sales performance during the previous four years. Two other companies in the top 10 - Telegroup of Fairfield, Iowa, and Matrix Telecom of Fort Worth, Texas - also are in the long distance business.

Streep was among about 1,000 executives gathered for the annual Inc. magazine 500 conference over the weekend in Los Angeles.

Based in Shamong, N.J., Furst Group buys long distance time in bulk from AT&T and other providers at steep discounts and then resells the time in smaller pieces to small businesses that could never afford a bulk purchase.

The system works because it isn't cost-effective for the big companies to make discount sales to small clients. Many larger corporations also lack the marketing savvy of companies like Furst, which are essentially sales organizations that target such clients, said Jeffrey Villwock, an analyst with Johnson Rice & Co. in New Orleans.

Furst, for example, keeps overhead low. The company does not own any actual lines, switching equipment or other costly investments. Its sales force of about 900 works primarily by telephone.

Congress earlier this year directed the Federal Communications Commission to open up the $100 billion-a-year local phone business to new rivals.

Streep acknowledged that a big reason for his company's success was the technological revolution that made the telephone vital not just for conversation, but for fax and computer transmissions, pagers, Internet access and other business tools.

It is part of a workplace revolution that has opened doors for other young companies as well. Let's Talk Cellular of America Inc., a retailer of phones, pagers and other personal communications devices, was launched from the back of a van in 1989.Smart marketing - all the company's stores are in malls to take advantage of foot traffic - and the growing popularity of cellular phones and pagers helped the company's sales grow to $8.3 million during 1995. The company ranked 441 on the Inc. list, with a 561 percent increase in sales over a four-year period.

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Photo: (Color) John Streep's Furst Group Inc. made first pl ace in Inc. magazine's 1995 list of America's 500 fastest growing companies.

Associated Press