HP heads back home to distis

By Sandhya Malhotra - 4 May, 2012


HP India'’s Personal Systems Group (PSG), returning back to its old IT distributors —Ingram Micro, Redington, Savex and Compuage —must have been largely appreciated by its channel partners. The company made this remarkable move after the failure of its telecom distribution model, which perhaps lasted for one year. However, when this new distribution model was introduced there were speculations about the new go-to-market strategy being implemented by HP PSG, after Sunil Dutt came on board as VP and GM, HP India—PSG. Many HP partners were upset with the new distribution model and alleged that the vendor had sidelined them in favor of the telecom partners.

But now as the company is moving back to its original model, market buzz is relating it with the stepping down of Dutt and because of a slump in sales of HP’s consumer range of laptops and desktops. According to a statement issued by HP, “Our channel strategy remains the same and the current improvements are in line with our objective to drive profitable growth, both for HP as well as its channel partners. Presently, we are rationalizing the number of partners to achieve greater efficiency and faster go-to-market execution of our strategy. In fact, our focus is to emphasize the importance of the IT channel in driving growth for HP.”

HP, has already replaced 7 out of 9 telecom distributors and nearly completed its realignment process as well. Telecom channel partners are avoiding to give any specific reason for leaving HP’s business. In Mumbai, HP has removed Priyanka Telecom as its zonal distributor, followed by 4 regional distributors including RSG Telecom, Shree Siyaram Technologies, and Pacific Citiphone.

Mumbai-based Chirag Suresh Shah, owner, RSG Telecom, HP’s tier-2 telecom partner, said, “"We were appointed by HP in June, 2010 as their regional telecom partner, and within 10 months, we have decided to discontinue the sale of HP laptops and desktops. As of now, our huge payment claims have been stuck with HP, so we do not want to comment further on this matter."
Similarly, Manish Agarwal, MD, Priyanka Telecom, HP’s zonal distributor for consumer PCs, confirmed that they are no longer doing HP’s business and are going under the transition. Also, a spokesperson at Pacific Citiphone, a tier-2 HP PSG partner stated that they are out of HP’s business and are now focusing on Dell’s business. Rajeev Mehta, CMD of Delhi-based Zest Systems, said, “HP’s decision to move back to IT distributors at this stage may not be a bad idea. Since, HP has worked with these distributors before, we see more value camping on the table for partners.”

The company began its IT distribution realignment after the exit of Sunil Dutt, who has now been replaced by Rajiv Srivastava as the GM and VP of HP PSG with effect from June 1, 2011. The company is also appointing new sub distributors and forming new channel centric polices. As per HP’s realignment model, Ingram Micro will replace Unicom Telecom in Punjab and Chandigarh, and Shalimar Enterprises in Haryana and Himachal Pradesh.


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