HP has chosen IT Wholesale as second distributor and rival to Tech Pacific for the vendor’s consumables business.
The announcement was delayed for a month because HP bosses overseas had to vet the selection process.
The appointment is intended to boost sales of HP toner and ink in retail outlets. IT Wholesale’s presence in that sector through sister company, Cellnet, which sells mobile phones through Telecom shops, helped clinch the deal.
HP also hoped that having two consumables distributors would help stamp out sub-distribution because a second dealer would offer resellers choice, HP printing manager, Jennifer Rutherford, said.
“I’m more than happy to rock the channel boat,” Rutherford said about laying down the law to resellers on sub-distribution.
The vendor chose ITW from a shortlist of four tenderers, but Rutherford declined to name who the other three were. Ingram Micro has confirmed it was one of them; Dove Electronics said it did not tender. Exeed, which distributes only HP products but has never sold consumables, did not respond to the tender either.
Rutherford dismissed suggestions that HP awarded the contract to ITW instead of one of Tech Pacific’s direct competitors so as not to upset Tech Pacific, which sells a lot of HP hardware.
“We chose IT Wholesale because they’re a really high-growth company," she said. "Our view of their key strength is their ability and reach through retail.” This complemented Tech Pacific’s consumables supply.
ITW is known for its large appetite for agencies, having acquired AusTek, SonicWall, Sony and NEC last year. The Australian-owned, Auckland-based distributor hit the headlines last July when Acer pulled the plug on its relationship less than a week after announcing it.
ITW general manager, Mike Hughey, said his company would take a different approach than Tech Pacific to HP consumables, but he would not give too many details away.
“It certainly won’t be as traditional as people are used to," Hughes said. "There will be other markets that we will sell into — more than just IT, more than just retail, more than just telcos.”
One example was electrical goods stores, he said.
Tech Pacific’s New Zealand managing director, Tony Butler, supported HP’s appointment of ITW because it would help clean up “unauthorised” sub-distribution and bring New Zealand’s pricing in line with world pricing.
“IT Wholesale is a company that we compete with on a number of areas," he said. "It is a good company … but I believe we do a better job. I wouldn’t be running this company if I didn’t believe that.”
Butler would not say what chunk of Tech Pacific’s turnover consumables represented but said total HP sales were more than 30 per cent of the distributor’s annual turnover.
Supplies account for about 13 per cent of HP’s total revenue and the segment is growing about 20 per cent a year.
ITW will launch its HP relationship in January or February. The contract will be signed once HP has sorted out some administrative details.