HP simplifies its business

HP has taken further steps to simplify its business by announcing a number of new initiatives and changes to the way it will interact with partners and end-user customers.

The vendor revealed today that it is merging its IPG and Supplies businesses into one unit, which will then sit under the Solutions Partner Organisation (SPO) umbrella. It is also looking cut the number of hardware configurations that it offers in the IPG business by 30 per cent.

Changes are due to take effect in the second half of the year.

Dave Poskett, director of SPO UK and Ireland, said: ““We need to leverage the fact that we have a very strong hardware business and a very strong supplies business. This will provide a simpler portfolio to customers in the marketplace.

“What we are looking to do is streamline the business,” he added. “We now have a great opportunity – for both our distribution partners and resellers - to simplify the operational efficiencies of how we all work together.”

Poskett said the new merged IPG and Supplies business will result in a single partner accreditation specialisation, as opposed to two separate accreditations.

A further announcement involved its PSG division, which will see HP integrate its consumer and small business small office (SBSO) business, and target end users in both spaces with the same product portfolio. This also means that SBSO customers (firms with 1-99 employees) will have access to both the HP and Compaq range for the first time.

David Wright, general manager of PSG, said: “The behaviour of customers in the SBSO market is becoming a lot more like consumers, so this move makes sense. We are looking to merge the products and families and also link this with aggressive up front pricing, which will simplify the supply chain and allow partners to make bulk orders.”

Wright said the number of configurations offered by this part of PSG will also be cut by 30 per cent.

“This will lower the amount of time for configuration for our distribution partners through Top Value and Smart Quote and simplify the choice for customers,” he added.

HP will not be shuffling its internal staffing structure, Poskett stressed, and will also not be cutting back any of its channel partners, including distribution.

“We are not planning any internal changes and we think it will actually help our distribution partners increase business,” he said.

Poskett also announced that HP would be continuing its new rebate strategy unveiled last month (Channelweb 9 February), which saw several target-based rebate schemes scrapped.

“In the UK we piloted the principle of removing targets for distributors and resellers in Q2, and it received very strong feedback,” he said. “We are going to continue that into Q3.”

The vendor is also going to continue with its partner development fund co-marketing strategy, but this will be discretionary spend, linked to the amount of business partners do with HP, he added.

The vendor is not planning any immediate price rises either Poskett confirmed.

“We have to continue to monitor all economic and market dynamics, but at this point in time we are not planning any further price increases for now,” he said. “We are keen to get it right first time and position ourselves aggressively in the marketplace.”