Compaq charms channel

Vendor redefines route to market

Compaq is seeking to reassure resellers of its commitment to the channel by outlining an enhanced channel strategy.

Mike Morgan, director of Compaq' channel business unit, said he firm has launched its "most flexible route to market yet".

He said: "There has been a lot of speculation with regard to us working with channel partners, but we want to position our channel strategy into what we believe is a very strong and superior alternative to Dell's model."

Earlier this month Compaq launched a five-pronged strategy to encompass indirect and direct routes to market. Sandwiched between its direct and indirect layers, Compaq has introduced Partner Direct, Referral and Affiliate status.

Under the company's Partner Direct model, resellers own the customers and order for them, while Compaq ships product to the partners.

The Referral model gives resellers ownership of the customer, but procurement is made in Compaq's name, and Compaq ships to the user. Under this scheme the firm pays resellers a commission of between four and eight per cent on products and up to 15 per cent on packaged services.

The Affiliate model allows partners to display the Compaq banner on websites and receive two per cent of the sale price from Compaq.

Morgan said that with its direct model, the company will go direct only if the business is new, if a customer insists on it, or if the sale is at risk without a direct touch.

"We will not tread on our partners' toes, but we will also not lose business to Dell if we don't do what our customer wants," Morgan said.

Daniel Rogers, sales director at VAR Vitec Communications, said: "We have been waiting for this for about a year. Compaq has outlined a clear mandate to everybody who plays in the channel regarding where it wants to attack the market, and we are very happy with it."

Tony Kingston, marketing manager at Compaq reseller Deverill, was more cautious.

"Compaq stated it was not aiming to set up an organisation that competes with its very successful channel, but believes it is offering another option to the marketplace, which has not previously been recognised. It is a question of wait and see what happens," he said.

Believing the merger with Hewlett-Packard will go ahead, James Governor, analyst at Illuminata, said: "Both firms realise they do need resellers. It seems to me that the channel partners are the driving force and have the upper hand in this situation."