Compaq Australia MD offers retail plan excuses

Compaq Australia Managing Director Ian Penman has responded to growing industry concern over the company's new retail strategy and the recent loss of support from major Australian retailers.

Compaq Australia Managing Director Ian Penman has responded to growing industry concern over the company's new retail strategy and the recent loss of support from major retailers.

Harvey Norman told ARN LiveWire on Tuesday last week that it would no longer carry Compaq PCs and other industry reports suggest Harris Technology and Coles Myer are seriously evaluating their relationship with the vendor.

At the launch of a new office in Adelaide yesterday, Penman told the assembled media the retail strategy must be put in perspective. Compaq's Australian sales for 1998 were A$1.5 billion (US$954.7 million) and its retail sales accounted for less than 10 percent, he said. Harvey Norman represented under half of that retail figure, which Penman said represents less than 5 percent of Compaq's sales. In addition, he claims Compaq's relationships with other retailers are healthy.

In response to industry reports that Harris Technology is planning to "dump" Compaq, Penman said the Coles Myer subsidiary has simply cut two Compaq products from its line-up -- the Prosignia, which it did not sell anyway, and the Presario, of which it sold very few. Harris Technology has retained the DeskPro and Armada range for its enterprise customers, Penman claimed.

Penman also confirmed yesterday he plans to have the first eight Compaq-branded stores open by the end of the year, with five in Melbourne and three in Brisbane. He said each store would be Compaq-owned and operated, with the intention of using them as the models on which to build a franchise. "I want to be playing with Compaq's money, and make sure we get it (the model) right, and then work to the franchise model," he said.

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