Big Blue fights the grey matter

Supply and demand: IBM is using mystery shoppers to find out where grey kit is leaving the official supply chain

IBM claims it is already making headway in its fight against grey market activity as a result of a recent price harmonisation drive.

As revealed by Channel­Web, Big Blue is aiming to reduce grey market activity “to a minimum” through a number of recently introduced measures. These include
carrying out test purchases in its unauthorised channel to trace where grey kit has left its official supply chain, and joining anti-grey alliance AGMA.

Since last summer, the vendor has also begun harmonising reference prices on options such as storage modules and hard disks across all geographies whenever there is a product rollover.

Prices on all new options will now have to fall within a “single-digit percentage” to make arbitrage business less attractive, explained Stephan Wippermann, vice president of Business Partner Transfor­mation for Europe at IBM.

“We came to the conclusion that because the grey market is global, the action we take to protect our pro­g­rammes also has to be global,” he said.

Wippermann claimed that price harmonisation had already had a “tangible effect”, citing a recent shortening in supply and rise in the cost of options.

“In recent test purchases [of options in the unauthorised channel] we found that out of the 10 products we looked for only six were available,” he said. “A year ago we may have found all 10.”

Wipperman said the clean-up would encourage more resellers to join IBM’s official channel programme.

“We want to use this as a differentiator to recruit new partners,” he said. “We want to be in a position to demonstrate that as a vendor we carry a responsibility to
protect our Business Partner programme.”

Stuart Fenton, president for EMEA and AsiaPac at reseller Insight Enterprises, said: “The grey market undermines the investment vendors make in each market. I welcome any action by vendors to stamp out grey kit and any effort to harmonise pricing, however difficult.”

Nick King, chairman of IBM partner Apex, said: “We are delighted that IBM has taken action to limit unofficial sales. Upholding the reputation of the product and the brand is crucial.”

Andrew Henderson, managing director of VAR Lan­way, said: “It will only benefit the UK if IBM is harmonising prices, because most of Europe and the US is buying cheaper.”

AGMA treasurer Peter Hlavnicka said: We are very excited about the individual successes of our members and the positive impact we can make on the IT industry as a group.”