HP gets channel rap over hybrid model

Trade

Fujitsu-Siemens Computers has slammed suggestions by HP that all PC vendors will be forced to adopt a hybrid direct and indirect sales model.

EMEA vice-president of HP’s solutions partner organisation, Jos Brenkel, argued last month that vendors would have to adopt a hybrid model because customers were calling for direct sales. He claimed vendors would have to consider all routes to market in a tough PC sector.

But Brenkel’s comments drew a scathing response from Fujitsu-Siemens Ireland channel sales director Liam Halpin.

“This is another example of a company that built its business on the back of the channel looking to cut the channel out of its business in the face of an increasingly competitive market,” he said. “HP is forgetting that it was the skills and competencies of the channel that delivered its historic business success.”

He pointed to Fujitsu-Siemens’ own history as proof that a hybrid model was not as successful as a 100 per cent channel approach.

“From 1999 to 2002 we operated a hybrid model in Ireland, as a result of the merging of Siemen’s direct business and Fujitsu’s indirect business,” Halpin said. “Since we aligned our strategy with our EMEA model of 100 per cent channel, we have delivered our most significant success across our volume and enterprise product and solution portfolio.”

As for customers demanding direct sales, Fujitsu-Siemens accepted some would “want the vendor to assume responsibility for big contracts [but] it is possible to do this within our channel structure. Our position is that we are a hardware vendor, we partner with resellers who sell the total solution including services. We do not compete with the channel for services.”

Halpin added that, “Fujitsu-Siemens would be more than happy to talk to any resellers disaffected with HP’s new view on the world.”

Reacting to Brenkel’s comments, Derry Hallinan, sales manager, product at CARA, said: “For a manufacturer to effectively sell direct it must invest significantly in account managers and other resources. HP in particular has been reducing headcount lately and it is unclear how it will address this challenge.”

He claimed the channel had “always provided services that manufacturers don’t bother with and which our customers demand. Some of our customers have experimented with buying direct but found the bureaucracy and de-personalised approach of the call centre model hard to deal with. Most of them have come back!”

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