With the death knell sounded for the Digital brand name, the company's largest Victorian distributor, CHA, is desperately putting together a contingency plan to minimise pain to the business.
With over 30 per cent of its business derived from Digital sales, CHA signed a national distribution deal with Philips this week and is currently in negotiations with NEC as part of a strategy to fend off any shortfalls arising from the Compaq acquisition, according to CHA director and head of sales and marketing Roger Bushell.
Earlier in the year CHA took on Acer and only last week announced an extension of its existing relationship with Toshiba. Bushell said the company will meet with local Compaq officials this week to discuss a potential partnership, but did not rule out the possibility of severing ties completely with the newly merged entity.
"We are reviewing our relationship with Compaq," Bushell said, emphasising CHA's particular loyalty to Digital. It's a sad day when you see a name like that disappear.
"It has been one of the most unique suppliers in the industry and unfortunately it failed to capitalise on this."
While Compaq has reportedly assured Digital distributors it will not turn its back on them, Bushell said: "We will have to see whether the new channel will work for us."
One of the key shortcomings in representing Compaq, according to CHA officials, is that the Compaq channel is "overpopulated".
"Digital really only had three major distributors, whereas Compaq has many more," Bushell said.
On the products front, Bushell said that there has been no indication as to what new products Compaq will bring to market. But if Compaq retains Digital's sales reps, CHA could be persuaded to stay, he said.