Netfire pulled from franchise contract

Hardware HP buys vendor out of deal following reseller complaints.

Hewlett Packard has taken back responsibility for its Office Centre dealer franchises from the Netfire Group, following the vendor's failure to satisfactorily address reseller requirements.

The manufacturer has now opted to co-ordinate them directly, after complaints that HP had been neglecting resellers and that the franchise was never given the proper backing to make it a success.

Netfire, set up in late 1996 by Westcoast managing director Joe Hemani and financial director Harry Walker, has consequently sold the remainder of the seven-year contract back to HP. Financial details were not disclosed.

Initially, the franchise was to be 300 strong but, at the last count, there were only approximately 60 registered.

HP claimed that, according to a reseller satisfaction survey it conducted among the Office Centres, its second-tier dealer partners had requested more direct contact.

Bill Hill, general manager of HP's small and medium-sized business sector, admitted that historically it had not done a good job communicating with the second tier: 'We left it to the wholesaler and our message often got diluted.'

One source at a former Office Centre said he was surprised it took so long for HP to want to get closer to its channel. It left the franchise within the past three months due to unsatisfactory service from HP.

Office Centres will now sit within the bottom of the three-level HP Connect programme. However, one industry source said he believed the franchise had been pulled because it did not fit in with HP's European strategy.

But Hill insisted that it was very much a part of HP Connect.

Alan Furniss, managing director of Netfire, said: 'It became clear in the past six months that HP is now interested in listening to the second tier.'