HP Launches High-Margin 3-D Printing Channel Program With 13 North America Partners, Eyes Wider IT Market Push In The Future

HP formally launched its high-margin 3-D Multi Jet Fusion printer channel program with 13 highly specialized North America partners with deep 3-D manufacturing expertise.

The 13 select partners, which have proven track records in the 3-D manufacturing market, will enjoy the benefits of an innovative high-margin program that allows them to participate not only in the sale of the products, but also receive rich commissions from materials used to print 3-D manufacturing products and the annual HP maintenance contract.

That ability to make commissions beyond selling the 3-D printers is a critical differentiator for HP, said Alex Monino, head of HP's worldwide 3-D printing channel program. "We have [manufacturing] material sales and service mapped to whoever sells the hardware," he said. "That is unique in the 3-D printing business."

[CRN Exclusive: HP 3-D Printing President Nigro On Channel 1.0, Adding New Partners, And The Future Product Road Map]

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A key focus of the channel program has been making sure that HP does not "overdistribute" the product, ensuring high margins for partners that have made significant investments to play in the 3-D manufacturing market, Monino said. Each of the partners has a detailed business plan with specific sales and profit goals.

"This is not a box-moving business," he said. "We have protected our partners' investments. We have really thought about the business model for the resellers. They are keen to invest knowing they are going to have a return on their investment. We are in this for the long run. What is important for us is that when partners invest, they have line of sight on their return."

HP formally launched the global reseller program – which includes three distribution partners: Synnex in the U.S., Westcoast in the U.K and ALSO International in the Netherlands -- at RAPID, a 3-D manufacturing show being held in Pittsburgh this week.

"Long term, this digital transformation is taking us and our partners outside of traditional IT into business technology," said Peter Larocque, president of North America distribution for Synnex, which is making significant investments to help partners cross the chasm into the 3-D manufacturing market.

"3-D print is driving all sorts of different applications that are putting partners at the front end of the business – not just the back end. The sky is the limit for this business. We have put a lot of resources into value print," said Larocque.

Key for partners is strong execution as they move from reselling IT products to mapping business transformation in highly specialized markets like manufacturing, he said.

"We have always done a good job executing with changes in the IT market. In this case we are working with our customers’ customer -- helping them make the sausage -- for example, an auto part store making parts," said Larocque.

Larocque credited HP CEO Dion Weisler and his executive management team with driving game-changing innovation with 3-D printing. "I take my hat off to HP," said Larocque. "They got A3 and 3-D print -- two big hits in a pedestrian print market. They have really stepped it up. They continue to innovate very well.’

The 13 North American partners are Solid Fabrications, EMS, MasterGraphics, Impac Systems Engineering, NovaCopy, NovaStor Solutions, SaraTech, Symmetry Solutions, TPM, Weatherford, DesignFusion, DMark and Hawk Ridge Systems.

Outside North America, HP certified another 17 partners bringing the total number of partners bringing the Multi Jet Fusion to market to 30, with 80 percent of them new to HP.

"None of these are the traditional IT resellers," said Monino. "Eventually as we scale the business and our portfolio we will have a role for the traditional IT channel. But right now given the customers we are targeting, it is a highly consultative sale. To start, we wanted partners with previous 3-D printing experience with applications engineers focusing on applications and how to optimize design of the parts. We have selected partners that know the market well. We are confident they will position us well in the 3-D printing market."

The HP channel program is not exclusive by territory or brand, with partners carrying 3-D printer products from competing vendors.

The channel partnerships for the first round of partners have been in place for the past six months, but now the initial partners are getting demo units and ramping up to aggressively sell 3-D manufacturing transformation. "They are ready to go and we are ready to scale," Monino said.

The HP channel program launch also includes new 3-D service bureaus and more than a dozen new HP 3-D Printing and Reference Experience Centers where partners and customers can get hands-on experience with Multi Jet Fusion and the 3-D print process to make parts.

HP said the Experience Centers will be able to assist in testing and qualification of 3-D print cases from prototype to full-scale production.

In the U.S., the Experience Centers are in Allentown, Pa; Atlanta; Carlsbad, Calif.; Livonia, Mich.; Louisville, Ky.; Manchester, Conn.; Milpitas, Calif.; Palo Alto, Calif.; San Diego; and Vancouver, Wash.

Overseas, the Experience Centers are in Raon-l’Etape, France; Leonberg, Germany; Eindoven, The Netherlands; Barcelona, Spain; and Birmingham, United Kingdom.

HP also has certified service bureaus to drive the 3-D manufacturing paradigm shift including Fast Radius, Forecast3D, Materialise, Proto Labs, Shapeways and Sigma Design.

Lastly, HP added Henkel Adhesive Technologies, a division of Henkel AG & Co., to its global materials partners that already include BASF, Evonik, Lehmann & Voss and Arkema.

Monino said HP is making the right investments in the channel and the industry to grow the overall 3-D printing market. "We are on a mission to change the world," he said. "It is going to be a long journey. We are ready for it. We are here for the long term – not just short-term success. We have selected partners who can scale the business with us."

The IT channel expansion for HP's Multi Jet Fusion 3-D print business will probably come in the 2018 time frame as the company expends the product portfolio into new market segments below the current $130,000 starting price point for the product.

"Eventually we'll scale the business in different directions with additions to the portfolio," said Monino. "We will select the right go-to-market strategy to go after every market segment."