HP distributor channel ‘unsustainable'

HP distributor channel ‘unsustainable'

With at least half a dozen players in the game, the distribution tier of the new HP has been brandished "unsustainable" by Ingram Micro Australia's managing director, Steve Rust.

Combining the former channels of HP and Compaq means the new vendor has potentially "six or seven" players supplying PCs and notebooks, according to Rust, and this is "too many", he told ARN last week.

Rust's comments come in the wake of the distributor's announcement that it is setting up an entire new division to deal exclusively with the combined HP/Compaq entity.

"It is a little confusing," Rust said of the vendor's current channel line-up. "I definitely know that a country of this size can't support more than about three distributors and probably two would be ideal.

"Right now there is the potential for six or seven to be distributing for the new HP's systems group even though most of the old HP product line is disappearing. That's just crazy to have so many distributors, and I don't think it will be sustainable in the long term."

Last week, HP's personal systems group manager, Tony Bill, and imaging group manager, Rebekah O'Flaherty, held a conference call with large distributors and direct resellers. The objective was to keep partners up to date with events since the takeover.

From that conversation, it now appears that all HP distributors will be gaining access to the full line-up of Compaq PCs, which dominate the systems division's line-up. However, potential conflict will emerge as the reverse does not appear to be happening in relation to Compaq resellers gaining access to the lucrative imaging products and consumables of HP.

For the full story, read this week's issue of ARN.

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