It's Back to IT distributors, for HP

href="http://www.dqweek.com/HP-moves-from-discrete-to-FlexNetwork-architecture">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.”

Discontinues
telecom relationship 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.” Realignment complete 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. Delhi and NCR will continue to be manged by Spectra, while
Uttar Pradesh and Uttaranchal will remain with Shivalik. Bihar,
Jharkhand and Orissa will be taken care of by Redington,
which were previously managed by Karuna Management. West Bengal and
the North East will continue to be with Linkworld Distribution, while
Savex Computers will take care of Mumbai, Maharashtra, Goa, Madhya
Pradesh, Chhattisgarh and Rajasthan. Gujarat will be with Compuage,
and Ingram will look after the
large format retailers.

Anil
Jagasia,
MD, Savex Computers said, “We have replaced Priyanka Telecom in
Mumbai and Aditya Telelink in Rajasthan. Additionally, we will
continue to supply to HP World retail stores, which accounts for more
than 280 stores across India.” HP learning from mistakes IT channel
partners not only welcomed HP's move but also looked interested in
going back to its old business. Welcoming HP's move to go back to
the old model, Toshy Mathew, district president, AKITDA said, “AKITDA
was the first to oppose this move. However, the decision was taken
for the sake of partners,but the way it was implemented was not
acceptable to our association. Meanwhile, our members are not
affected, as we do not have any telecom partner in Kerala.” While
welcoming HP's recent move, Jagasia said, “I think HP has taken the
right
steps by going back to the national IT distributors. Our partners are
also bullish about their new strategies.”

However,
there is no change in the South region, Redington will continue to
supply in Kerala and
Tamil Nadu, and Ingram Micro will operate in Andhra Pradesh. HP has
added a few new sub distributors in Kerala. Kerala-based Binu
Varghese, GM, Aldous Glare said, “There is no change in zonal
distribution, Redington is supplying in Kerala. Moreover, HP has
recently appointed 5 tier-II sub distributors in Kerala, and we are
one of those for HP.” He added, “Earlier, we discontinued our
relationship with HP due to its exclusivity rule, but now we are
again on board. We are delighted to know that HP is returning back to
the old model and restabilizing links with old partners. I think the
new change will help HP achieve its lost glory and take the
competition head on.” Although some regional distributors are happy
to go back to HP and join their business, Delhi-based Park Network,
one of the oldest and strong RDs of HP doesn't seem optimistic
about the same. Ajaya Kumar, CMD, Park Network said, “As of now, we
have no plans to go back to HP, but we are happy that the vendor has
learnt from its mistakes.”