HP Rebate Snafus Force Exclusive Partners To Seek Alternative Vendors

That's what some longtime HP-exclusive partners are saying in advance of the vendor's Americas Partners Conference in Las Vegas Feb. 24-27.

In fact, almost all of the dozen HP partners contacted by CRN said they were having logistical problems with the vendor's flagship PartnerOne Attach Plus rebate program. The most common problem reported was that HP's "sales out" data didn't match their own internal numbers, making their HP rebate payments difficult to track and virtually impossible to predict.

PartnerOne is HP's umbrella channel program. Attach Plus is the HP rebate program that pays partners money for bundling HP products and services into a single solution. And in March 2007, HP introduced Growth Accelerator, which is stackable on Attach Plus rebates and pays partners additional money if they hit specified quarterly sales growth goals.

But in addition to the data glitches, HP partners say they are losing out on sales and rebate opportunities because of gaps in the vendor's storage lineup. And despite what they consider to be a significant commitment on their part to HP, they say they are seeing few leads from HP's direct sales force.

The problem seems most pronounced among HP's Gold and Platinum partners, the vendor's largest and most loyal, and those that should have the most to win with Attach Plus. What's more, five Gold partners that consider themselves HP-only told CRN that problems with rebates and HP storage are forcing them to consider abandoning an HP-only model and explore partnerships with Network Appliance Inc., EMC Corp., Sun Microsystems Inc. and even Dell Inc.

"As an HP exclusive partner, there is no benefit financial or otherwise at this stage of the game to being exclusive," said one HP Gold partner, who asked to remain anonymous. "If you are exclusive to a vendor, the benefits should be different. You should have access to more HP people and resources and act more as an off-payroll type of HP employee. But that's never materialized."

Sales Data Complications

Solution providers say Attach Plus matrices are so complex, and the difficulties they experience trying to obtain and verify realtime sales-out data mean they can't track or predict rebate payments.

"They've made it so complicated and convoluted that it doesn't pay predictably," said another HP Gold partner, who asked not to be identified. "They have a huge problem tracking sales data. We'll upload sales data and it won't show up on HP's systems, and if they don't get sales numbers right, you're screwed. We have all of this money tied up in rebate programs, but there are so many links in the chain that if any one fails, the whole chain fails. It's problems like this that have led me to become a NetApp partner."

Another exclusive HP Gold partner expressed similar frustrations. "Trying to reconcile our sales out vs. what HP tells us our sales out are has always been a problem," he said. "Lots of times they are not even close. Not only don't the numbers match, but we're not sure what HP is basing the numbers on. When a point to a point and a half of gross margin is riding on the numbers, this is serious money."

The problem is widespread, even touching smaller HP partners.