HP denies increasing direct sales headcount

Despite a raft of new internal sales appointments, HP's local print boss has poured cold water on fears the vendor is planning to grow its direct business. Instead, he said the move was designed to help it make bigger inroads into the cost per-page market.

According to a recent Computer Daily News article, HP enterprise Imaging and Printing Group (IPG) vice-president for Asia-Pacific and Japan, Kelly Tan, announced during a media briefing in Beijing that the company had almost tripled its direct sales team in Australia.

HP South Pacific vice-president of imaging, printing and consumer business, Christoph Schell, confirmed it had made 15 appointments since the end of last year. But he said only seven of the new staff went into its direct enterprise IPG business, with the remainder taking on partner support roles.

"This reflects what we have been pushing with our channel partners over the last year," he said. "The copying/digital convergence business is a big opportunity for us to grow. We can only scale with partners."

Schell highlighted HP's new MFD range, Edgelink, as the catalyst for growth.

"These are the first ink-based copying products in the industry. We're hoping for big breakthroughs," he said.

In 2004, HP introduced an Enterprise Account Progam (EAP) across the IPG business to kick-start cost-per-page sales. As part of this strategy, it took up to 200 customers direct, representing up to 10 per cent of revenue. It currently has 162 direct accounts in A/NZ.

"When EAP was launched, there wasn't a lot of interest from partners to go in with HP on copy-based [cost-per-page] solutions. We had to make a call and decided to launch not only direct touch, but also direct fulfillment.

"This market has now changed: we've put a lot of R&D behind product support and have a complete platform. Now is the time to scale up and move from single digital market share to double digit. And we can't do this by ourselves." HP freezes the direct sales list for six months to allow its sales team to penetrate the account. If this doesn't happen, it is pushed out to channel. Schell said HP was also looking to leverage partners in existing direct accounts.

He stressed the vendor's commitment to the channel, saying it was taking a very focused approach on its indirect business across all technology divisions.

"The customer management costs are very high and I want to go indirect wherever I can," Schell said.

HP has been working closely with its certified digital convergence partners to drive enterprise printing sales. Current partners are Data#3, Commander, Mitronics and Imagetec. Schell said he was looking to increase that number to eight by the end of the year. Potential applicants came from IT and copier backgrounds.

"We have been segmenting the market further, making sure there are no overlaps. We're understanding a partner's vertical and geographic strongholds and where they can play," he said.

Schell estimated 93 per cent of its enterprise IPG business was now indirect.