Compaq partners investigate sales option
Compaq resellers are calling for clarification of the reward mechanisms the vendor will use in its Channels for the Internet Age (CIA) model.
Compaq resellers are calling for clarification of the reward mechanisms the vendor will use in its Channels for the Internet Age (CIA) model.
Neil Marshall, Compaq's director of European channel strategy, said this will be announced to the channel within six to eight weeks.
Resellers are concerned about the potential drop in turnover resulting from an agency model. "Those with a lot of hardware business might find that it will affect how their business is funded," said Martin Southern, chief executive of reseller Debug Holdings. "Overdrafts are usually secured against the debtor book."
He also pointed out that a fall in turnover can affect a business's image. The so-called sales-fee option in CIA will involve resellers taking title to product so orders can still be put on their books, said Marshall. But Southern pointed out that if the commission is higher for passing leads onto Compaq than the fee for reselling product, resellers will have to chose between making more money or keeping their resale business.
Marshall said that although not yet decided, the fees paid to resellers will be "competitive". Some resellers said they were concerned that CIA is the first step in Compaq taking away their business.
Meanwhile, despite analysts' predictions, Compaq has said that its acquisition of US distributor Inacom will not be copied in Europe. Instead, the vendor will contract the supply-chain functions needed for its direct-sales organisation.
Marshall said Compaq will use sub-contractors to set up an integrated supply chain, and plans a formal tender process to find product configuration and logistics firms. Mark Walker, director of enterprise systems at Ideal Hardware, said there are no obvious UK candidates capable of high-volume build-to-order manufacturing and distribution, and said a start-up or a joint-venture company could be created to meet that need.
Marshall said Compaq aims to have its supply chain in place by the third quarter of this year. "We've a lot of work to do and not a lot of time, but we have been working on this for six months, and changes to our supply chain will be made soon," he said.