A cost-effective means of benefiting from true enterprise computing is what Hewlett-Packard South Africa aims to offer SMEs, government departments and start-up or empowerment companies through the aggressive re-marketing drive it launched this week.
The local division is tasked with increasing a revenue stream that globally contributed almost R14 billion to HP`s turnover last year. It`s quite a task, considering the heavy discount structure which accompanies re-marketed computing equipment. But it`s one that Kevin Barnard, the business development manager driving the initiative, is confident the company can complete.
"Re-marketing covers the entire process of receiving the stock, stripping it down to parts, evaluating them [and replacing those which are defective], rebuilding machines to specification and taking them to market at highly competitive prices," he explains.
Customers can typically expect to find HP`s re-marketed enterprise servers, enterprise and local area network storage, and Unix and Windows NT workstations at prices approximately 20 per cent lower than those for new products. Add this to the fact that many of the internal components - hard drives and memory, for example - are brand new and re-marketing seem the ideal answer to the cost-conscious IT buyer`s questions.
So why does HP face resistance from the sceptical minority that perceives re-marketing as a means of pushing sub-standard equipment into the marketplace? Barnard says it`s primarily due to a lack of understanding, and that the image of a second-hand PC lot touting rickety wares is nothing short of a myth.
"There are many customers who prefer brand-new product. That`s why HP sees re-marketing as an alternative for the customer; we don`t compete with new sales.
"Re-marketed servers, storage and workstations are practically new, though. Nothing in our warehouse is over 18 months old, around 60 per cent of the components are brand new and, typically, our solutions are available eight to 12 months after the product is first released. In addition, product can be ordered off the web, built to spec and delivered within 12 days."
Computer Configurations Holdings (CCH), Computer Workstation Sales (CWS) and USKO have been HP`s re-marketing channel partners for two years. As part of this renewed drive, however, HP is looking to expand its channel partner base even further, the ideal companies being resellers with roads into cost-conscious markets.
"Our new [and existing] partners will have an attractive value proposition to take to potential customers: for the small to medium enterprise market, high performance IT is a differentiator ... in fact, where the internet is concerned, IT often drives businesses rather than simply supporting them," says Barnard.
"With a re-marketed proposal on the table, these organisations gain access to some of the latest technology at price points which are far more accessible than those of a new solution."
HP expects this approach to also find favour in those national, provincial and local government departments not bound by tender-related brands and processes. The same is true for economic empowerment companies or start-ups which do not have the luxury of JSE-listed group backing.
"It comes down to the fact that in addition to the consulting, support and technical expertise we can offer on re-marketing deals, we are also in the market with solutions that offer very high returns on investment," concludes Barnard.
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