HP distributors face more rebate changes
Hewlett-Packard (HP) is driving its distributors to plough more money back into the channel with further changes to its Ts&Cs.
As CRN went to press the vendor and its distribution channel were meeting in Spain to discuss the changes, which will come into effect on 1 May.
Details are yet to be released, but CRN understands that the vendor will change its distribution rebate structure by encouraging firms to reinvest the rebates they receive from HP straight back into the VAR channel for additional training and support.
Rebates have worried HP's channel for some time. At the end of last year, VARs called a meeting to discuss HP's proposed cut in rebates for resellers and distributors (CRN, 13 December).
Steve Lockie, UK managing director at Computer 2000, said the latest changes were a "tweaking of the current scheme".
"It is absolutely the right move. We want to see other vendors question their rebate schemes and ask if rebates create the right channel behaviour. If not, they should take rebates out," he said.
Lockie added that the original intention was for rebates to reward partners for adding real value, but most rebate schemes have developed into revenue and target-based programmes.
Andy Dow, commercial director at Westcoast, was also positive about the changes. "HP has brought predictability to its channel. This enables distributors and resellers to understand their responsibility and build a solid business," he said.
Des Lekerman, managing director of VAR eurodata, said: "Rebates should be given to the companies that drive demand ? resellers. Simply offering higher margin and axing rebates would start price wars. HP should scrap rebates and reserve money for VAR marketing funds."
Sue Richards, managing director of VAR EBM, said: "HP is giving us more than enough support. What we would really like from distribution is lower prices."
HP was unavailable for comment.