Nah nah, didn't hurt

Tabloid loves nothing less than a good channel stoush. And it's Compaq's long-running battle with Harvey Norman that's setting new standards for the industry.

The saga took an interesting twist recently when we had (another) chat with Compaq boss Ian Penman about his old mate, Gerry Harvey.

Compaq wishes to pursue a franchisee model for it's Compaq Connect retail stores, with Penman stating he'd be happy for Harvey Norman to "engage with the franchisee arrangement".

"The original fracas was based on a miscommunication, no one really believed they were not going to be Compaq stores," Penman explained.

But what really caught Tabloid's attention was Penman's claim that losing the retail juggernaut from its channel did not in fact hurt sales or revenues.

Penman said Compaq has grown 86 per cent in the consumer/SMB segment this year above 1999 figures as other retailers picked the sales left by the HN hole. "There's a huge market for consumer products today," he said of the market that's clearly ripe for the picking.

"Now we've proved that they [Connect stores] can be profitable and we're going to franchise these stores, the whole problem [with Harvey Norman] goes away," he said.

Of course, a reuniting of the two companies would make a great news story.

But Tabloid can't help wonder how Gerry will feel about Compaq's offer of friendship, despite its accompanying "we're doing fine thanks" attitude.