Solution Providers Greet HP's Direct Push With Mixed Reactions


Hewlett-Packard is increasing its direct push into the SMB market by sending a product catalog to about 2 million customers.

The free quarterly catalog--a glossy, color magazine including photographs of the new HP's full product line--is an update to the direct mailings Compaq Computer and HP used to ship to SMB customers prior to the merger, said an HP spokeswoman. The catalog describes how the products make up full solutions and instructs customers to purchase direct from HP or from a solution provider.

HP solution providers expressed a variety of reactions to the vendor's move.

"I would be pretty disappointed if a catalog shows up at my customer and now I am competing against the manufacturer all over again," said Todd Barrett, networking sales manager at CPU Sales and Service, a Needham, Mass., solution provider. "As far as we know, HP is still deciding what to do with its channel."

John Riddle, president of Information Networking, a network integrator in Irvine, Calif., said HP should have "saved the trees" it used to produce the catalogs because thousands of solution providers already do a great job offering the SMB market a full range of solutions from HP and other manufacturers. But, since the catalog is completed, he said he'd use it to his advantage.

"It seems like a good tool to add to a solution provider's bag of tricks because it shows the customer how many different products it takes to make up a whole solution," he said. "Most customers will use this as another storefront to gather information and then turn to us [solution providers to deliver the full solutions."

Other solution providers were indifferent, saying they long expected the new HP to follow Compaq's direct efforts.

Brad Butler, vice president of Acropolis Computers in Wood River, Ill., remembers his Compaq sales rep calling him more than a year ago and asking him to buy from a catalog and online in return for an agent fee, which was lower than his already miserable Compaq margin. He refused and shortly after began shifting his company's focus from hardware to solutions, mainly based on thin-client technology. Since then his business has grown 120 percent.

"Compaq's direct sales made it tough on us at first because we wrapped integration and configuration services into the sale of the box," he said. "Today, we don't care because we focus on services."