Toshiba To Increase Partner Compensation

Jerry Lumpkin, Toshiba's vice president of business channel sales, said several requests for changes to the program have been submitted to Toshiba's corporate executives and he hopes to have final word on their status by the end of the month.

One of those changes is to increase the amount of money platinum solution providers certified to service Toshiba notebooks receive for work. Lumpkin declined to reveal the specific increase but said some of the compensation would be tied to how well customers rate each service provider.

Lumpkin also acknowledged what solution providers have been saying for several years: Toshiba is among the lowest paying vendors in the notebook market.

"Most notably people are talking about our reimbursement level being pretty low, compared to industry standard," said Lumpkin, a former Ingram Micro executive who has been with Toshiba for about three months. "I have made multiple recommendations how to enhance our server provider programs to corporate and we are discussing those."

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Dan Hogan, vice president at DSR, a solution provider in Elkridge, Md., that handles at least 400 service requests per month, said the change would help increase profits. Hogan noted that five years ago Toshiba had been one of the leaders in service compensation at $100 per incident but has twice cut that rate. Now it is just $55.

"It would be nice if they came out and put themselves back at the top, but my guess is it will be somewhere between top and bottom," he said.

At the same time, Toshiba is discussing increasing rebates and incentives for product sales, Lumpkin said. Among the ideas being discussed are increased rebates for gold partners and a rebate program for Toshiba's lowest silver-level partners. Currently silver partners are ineligible for rebates, except through the Quick Start program for new partners. Toshiba also is looking at extending its Quick Start program, which offers a 5 percent rebate on product sales to new partners for a limited time. Another idea is to simplify partners' ability to get demo units in-house.

Currently Toshiba offers a 1.5 percent rebate on for its gold partners, who must sell between $100,000 and $250,000 in product each six months. It offers 3 percent (1.5 percent rebate and 1.5 percent MDF) for its platinum partners who must sell $250,000 or more of product each six months.

Zaher Khatib, vice president of sales at Coast to Coast Technology, an Irvine, Calif.-based solution provider, said increasing rebates is helpful so long as direct marketers don't use the added compensation to further discount the price of Toshiba notebooks. Khatib would like to see a minimum advertised price enacted to help protect his selling price.

Toshiba, once a high-flying maker of notebooks, has lost the loyalty of many channel partners after it attempted to spur its direct sales several years ago and cut back on its channel commitments. Lumpkin was hired to help put the vendor back on track with its partners.