Vendors rethink after Renaissance change

Renaissance's decision to give four big names - Microsoft, Hewlett-Packard, Compaq and Toshiba - the chop is prompting a distribution rethink by the vendors.

Renaissance’s decision to give four big names — Microsoft, Hewlett-Packard, Compaq and Toshiba — the chop is prompting a distribution rethink by the vendors.

Tech Pacific, meanwhile, which now has sole distribution rights for Compaq, Hewlett-Packard and Toshiba, is saying it won’t lift prices.

“We think there’s more to be gained through channel efficiencies by having one warehouse,” says Tech Pacific head Tony Butler. “In New Zealand, that can easily result in savings of about 1%. There’s no requirement at all for the prices to go up, just for the efficiencies of the supply chain to improve.”

Microsoft New Zealand head Geoff Lawrie says the Renaissance decision is indicative of challenges distributors currently face. “Mal [Thompson, head of Renaissance] is focusing on the parts of his business that are profitable. As a public company the decision makes sense ... If [parts of his business] aren’t profitable then he should be congratulated for being proactive about it.

“We’re using this decision by Renaissance as the catalyst to relook at our distribution model.”

The software giant currently distributes through Express Data, Tech Pacific and OEM distributors.

Compaq New Zealand head Russell Hewitt says there will be no change to Compaq’s channel strategy, for now. With the merger with Hewlett-Packard hanging over the company, Hewitt says having a stable player — Tech Pacific — servicing customers is the most appropriate tactic at this stage.

Renaissance’s promise to focus more sharply on the education market with its exclusive Apple range, however, could cause a change in Compaq strategy.

“It might cause us to have a look at what our education strategy is and decide whether or not we want to continue playing there. That’ll be worth a relook as we always do in February.”

Hewlett-Packard New Zealand head Barry Hastings says the company has been thinking about its distribution model for the last two to three months, and will now focus on it more urgently.

“I’m hoping the announcement doesn’t mean we’ll sever our relationship altogether and there will be some specialist products within the HP range they’ll continue to distribute,” Hastings says.

Toshiba New Zealand manager Steve Ford says the announcement will prompt the notebook vendor to re-evaluate its distribution strategy in the new year. Toshiba had an exclusive arrangement with Renaissance until about 18 months ago when Tech Pacific was also appointed.

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