HP's "retail" business model - Hewlett Packard

This is a discussion on HP's "retail" business model - Hewlett Packard ; A client of mine got a gift of two HP computers from a relative. He said they were bought (actually ordered) at Office Depot. They arrived at his house in cartons addressed to him, with shipment originating in China, from ...

+ Reply to Thread
Results 1 to 10 of 10

Thread: HP's "retail" business model

  1. HP's "retail" business model

    A client of mine got a gift of two HP computers from a relative. He said they
    were bought (actually ordered) at Office Depot. They arrived at his house in
    cartons addressed to him, with shipment originating in China, from the
    location(s) of HP's contract equipment manufacturer(s).

    So, yes, HP still follows a more retail-oriented approach than the other really
    major player, Dell. But it appears that both Office Depot and HP are pursuing a
    hands-off policy in handling inventory to the greatest extent possible. This
    also keeps them in a position where they both have the shortest duration
    inventory turns and as little inventory showing up on the books at any time.

    Am I bashing Hp in stating this? No. It's reality, and it's a shrewd way to do
    business. And it's the approach taken whenever possible by Dell and Gateway,
    altho Dell is almost exclusively mail order (except for the 60-day warranty
    Costco Dell boxes) and Gateway is more like HP in its retail storefront
    presence.

    The quick summary is that all three have evolved into marketing and sales
    companies with little or no manufacturing expertise and not a lot of engineering
    expertise when it comes to consumer-oriented computers. So, really, what IS the
    difference among the three?

    .... Ben Myers

  2. Re: HP's "retail" business model

    Ben Myers wrote:
    > A client of mine got a gift of two HP computers from a relative. He
    > said they were bought (actually ordered) at Office Depot. They
    > arrived at his house in cartons addressed to him, with shipment
    > originating in China, from the location(s) of HP's contract equipment
    > manufacturer(s).
    >
    > So, yes, HP still follows a more retail-oriented approach than the
    > other really major player, Dell. But it appears that both Office
    > Depot and HP are pursuing a hands-off policy in handling inventory to
    > the greatest extent possible. This also keeps them in a position
    > where they both have the shortest duration inventory turns and as
    > little inventory showing up on the books at any time.
    >
    > Am I bashing Hp in stating this? No. It's reality, and it's a shrewd
    > way to do business. And it's the approach taken whenever possible by
    > Dell and Gateway, altho Dell is almost exclusively mail order (except
    > for the 60-day warranty Costco Dell boxes) and Gateway is more like HP
    > in its retail storefront presence.
    >
    > The quick summary is that all three have evolved into marketing and
    > sales companies with little or no manufacturing expertise and not a
    > lot of engineering expertise when it comes to consumer-oriented
    > computers. So, really, what IS the difference among the three?


    You didn't mention the model number(s)/families of the computers
    involved. I think that makes quite a difference.

    As to your question: As you mention, the business model for the
    'channels' is still different. I for one would not likely buy a personal
    (as in I pay/own it) computer by mail order. But if you're in Outer
    Remotistan, it's probably very nice to be able to buy remote. Different
    strokes for different folks.

    BTW, what's that "Gateway" thingy you keep mentioning? :-) [1]

    [1] AFAIK, Gateway is effectively non-existent here (The Netherlands).

  3. Re: HP's "retail" business model

    Ben Myers wrote: >

    > ... bought (actually ordered) at Office Depot. They arrived
    > at his house in cartons addressed to him, with shipment
    > originating in ...


    Drop-shipping is nothing new, I've seen it happen with
    several resellers back into the early 1990s.

    > ... China, from the location(s) of HP's contract
    > equipment manufacturer(s).


    International drop-shipping, on the other hand, strikes
    me as very tricky to do economically, due to customs
    issues. It's one thing to clear customs with a container
    full of identical items, but I would imagine it's rather
    expensive to handle a container of disparate items,
    all addressed to different recipients.

    Perhaps these factories obtain pre-clearance prior
    to shipment, and the stuff just breezes across the
    border.

    --
    Regards, Bob Niland mailto:name@ispname.tld
    http://www.access-one.com/rjn email4rjn AT yahoo DOT com
    NOT speaking for any employer, client or Internet Service Provider.


  4. Re: HP's "retail" business model

    Models: Pavilion or Presario. AFAIK, those are the only ones sold at retail by
    HP, at least in the US.

    Gateway: maybe the 4th or 5th largest computer brand/company in the US,
    including the lamentable eMachines brand. The Gateway brand is probably
    non-existent outside the US. For a long time, Gateway computers were extremely
    well made with a solid chassis, mostly standard form factors, and mostly
    top-notch peripherals inside.

    Yes, the retail channel is quite different than mail order. And the reseller
    channel even more different still. But it strikes me as more than interesting
    that retail and mail order are converging when the opportunity arises, as it did
    in this case... Ben Myers

    On 03 Jan 2006 21:13:06 GMT, Frank Slootweg wrote:

    >Ben Myers wrote:
    >> A client of mine got a gift of two HP computers from a relative. He
    >> said they were bought (actually ordered) at Office Depot. They
    >> arrived at his house in cartons addressed to him, with shipment
    >> originating in China, from the location(s) of HP's contract equipment
    >> manufacturer(s).
    >>
    >> So, yes, HP still follows a more retail-oriented approach than the
    >> other really major player, Dell. But it appears that both Office
    >> Depot and HP are pursuing a hands-off policy in handling inventory to
    >> the greatest extent possible. This also keeps them in a position
    >> where they both have the shortest duration inventory turns and as
    >> little inventory showing up on the books at any time.
    >>
    >> Am I bashing Hp in stating this? No. It's reality, and it's a shrewd
    >> way to do business. And it's the approach taken whenever possible by
    >> Dell and Gateway, altho Dell is almost exclusively mail order (except
    >> for the 60-day warranty Costco Dell boxes) and Gateway is more like HP
    >> in its retail storefront presence.
    >>
    >> The quick summary is that all three have evolved into marketing and
    >> sales companies with little or no manufacturing expertise and not a
    >> lot of engineering expertise when it comes to consumer-oriented
    >> computers. So, really, what IS the difference among the three?

    >
    > You didn't mention the model number(s)/families of the computers
    >involved. I think that makes quite a difference.
    >
    > As to your question: As you mention, the business model for the
    >'channels' is still different. I for one would not likely buy a personal
    >(as in I pay/own it) computer by mail order. But if you're in Outer
    >Remotistan, it's probably very nice to be able to buy remote. Different
    >strokes for different folks.
    >
    > BTW, what's that "Gateway" thingy you keep mentioning? :-) [1]
    >
    >[1] AFAIK, Gateway is effectively non-existent here (The Netherlands).



  5. Re: HP's "retail" business model

    I know that Dell does and Gateway did a lot of international drop shipping.
    Fedex (Memphis) and UPS (Louisville) both have customs clearance operations to
    clear container or pallet loads for large international shippers. Both also
    provide logistics services for computer and other companies which need to
    maintain centralized and quickly accessable spare parts inventories.

    The difference between today and the '90s is that the drop shipments go direct
    from offshore contract electronics manufacturer (CEM) to customer, never even
    coming close to an HP, Dell, Gateway or IBM/Lenovo facility. Back in the day,
    way before Fedex and UPS were able to streamline shipping, shipments went from
    CEM to brand-name company warehouse, where the products were re-shipped to
    customers and retail stores.

    If I could place a large bet, I would wager that HP consumer products get
    drop-shipped regularly direct from CEM to retail store... Ben Myers

    On 3 Jan 2006 16:13:32 -0800, "rjn" wrote:

    >Ben Myers wrote: >
    >
    >> ... bought (actually ordered) at Office Depot. They arrived
    >> at his house in cartons addressed to him, with shipment
    >> originating in ...

    >
    >Drop-shipping is nothing new, I've seen it happen with
    >several resellers back into the early 1990s.
    >
    >> ... China, from the location(s) of HP's contract
    >> equipment manufacturer(s).

    >
    >International drop-shipping, on the other hand, strikes
    >me as very tricky to do economically, due to customs
    >issues. It's one thing to clear customs with a container
    >full of identical items, but I would imagine it's rather
    >expensive to handle a container of disparate items,
    >all addressed to different recipients.
    >
    >Perhaps these factories obtain pre-clearance prior
    >to shipment, and the stuff just breezes across the
    >border.



  6. Re: HP's "retail" business model

    On the seventh day, Ben Myers wrote...

    > The quick summary is that all three have evolved into marketing and sales
    > companies with little or no manufacturing expertise and not a lot of engineering
    > expertise when it comes to consumer-oriented computers.


    So you're talking about the Pavillon line of PCs

    > So, really, what IS the
    > difference among the three?


    I'd argue, there hasn't been one and there is none nowadays. Except for the
    early Presario line from Compaq I've never seen non-standard PCs from
    these.

    But the consumer-oriented PCs and the workstation market is quite
    different.

    --
    mit freundlichen Grüßen/with kind regards
    Christian Dürrhauer, Institute of Geography, FU Berlin

    I'm not suppsed to be here, sir. I'm.....supposed to be dead! -
    Tasha Yar, "Star Trek: The Next Generation, (Yesterday's
    Enterprise)"

  7. Re: HP's "retail" business model

    Yes, FORTUNATELY, workstations and servers are treated differently, as are
    high-end printers... Ben Myers

    On Wed, 4 Jan 2006 09:50:11 +0100, Christian Dürrhauer
    wrote:

    >On the seventh day, Ben Myers wrote...
    >
    >> The quick summary is that all three have evolved into marketing and sales
    >> companies with little or no manufacturing expertise and not a lot of engineering
    >> expertise when it comes to consumer-oriented computers.

    >
    >So you're talking about the Pavillon line of PCs
    >
    >> So, really, what IS the
    >> difference among the three?

    >
    >I'd argue, there hasn't been one and there is none nowadays. Except for the
    >early Presario line from Compaq I've never seen non-standard PCs from
    >these.
    >
    >But the consumer-oriented PCs and the workstation market is quite
    >different.



  8. Re: HP's "retail" business model

    Ben Myers wrote:
    > Models: Pavilion or Presario. AFAIK, those are the only ones sold at
    > retail by HP, at least in the US.


    Thanks for the info. In The Netherlands the retail channel used to
    include the HP OmniBooks, but I haven't seen them recently.

    [Gateway info deleted]

    > Yes, the retail channel is quite different than mail order. And the
    > reseller channel even more different still. But it strikes me as more
    > than interesting that retail and mail order are converging when the
    > opportunity arises, as it did in this case... Ben Myers


    Well, in our country, retail and mail order have been converging for a
    number of years, i.e. most retail stores also have mail order (by
    website, telephone, etc..), and sometimes the reverse is also true.

    I think the special thing in this case (i.e. your OP) is that, as you
    described, the contract electronics manufacturer (CEM) shipped directly
    to the customer, internationally at that.

  9. Re: HP's "retail" business model

    Ben Myers schrieb:

    > Models: Pavilion or Presario. AFAIK, those are the only ones sold at retail by
    > HP, at least in the US.


    Well, here in Germany we don't have Presarios any more (probably because
    Compaqs "Presario" had a bad reputation here). We have Pavilions,
    though, but like the Pavilions in most other countries they are not made
    by HP but by a subcontractor (usually a bigger assembler, in Germany
    it's Medion). The only which really is from HP is the label. Even the
    support isn't done by HP but by the subcontractor which makes the
    support experience very different to "real" HP computers...

    > Gateway: maybe the 4th or 5th largest computer brand/company in the US,
    > including the lamentable eMachines brand. The Gateway brand is probably
    > non-existent outside the US. For a long time, Gateway computers were extremely
    > well made with a solid chassis, mostly standard form factors, and mostly
    > top-notch peripherals inside.


    There was a quite short Gateway period in Europe but I remember that
    they closed down after a few years.

    > Yes, the retail channel is quite different than mail order. And the reseller
    > channel even more different still. But it strikes me as more than interesting
    > that retail and mail order are converging when the opportunity arises, as it did
    > in this case... Ben Myers


    Well, keep in mind that consumers usually want as much features as
    possible for the lowest price, and this market can't be served with
    putting much efforts into own developments. So it's understandable that
    companies like HP pushed this to subcontractors which serve consumer
    markets with cheap generic standard off-the-shelf-parts...

    Benjamin

  10. Re: HP's "retail" business model

    Frank Slootweg wrote:
    > Ben Myers wrote:
    >
    >>Models: Pavilion or Presario. AFAIK, those are the only ones sold at
    >>retail by HP, at least in the US.

    >
    >
    > Thanks for the info. In The Netherlands the retail channel used to
    > include the HP OmniBooks, but I haven't seen them recently.
    >
    > [Gateway info deleted]
    >
    >
    >>Yes, the retail channel is quite different than mail order. And the
    >>reseller channel even more different still. But it strikes me as more
    >>than interesting that retail and mail order are converging when the
    >>opportunity arises, as it did in this case... Ben Myers

    >
    >
    > Well, in our country, retail and mail order have been converging for a
    > number of years, i.e. most retail stores also have mail order (by
    > website, telephone, etc..), and sometimes the reverse is also true.
    >
    > I think the special thing in this case (i.e. your OP) is that, as you
    > described, the contract electronics manufacturer (CEM) shipped directly
    > to the customer, internationally at that.



    With HP computers (Pavilions or Presarios) there are those that are
    'build to order', and those that are 'ready to ship'. The onse you see
    in the stores are the latter. Some store have kiosks where customers can
    configure and order a computer. Those computers are then built and
    shipped to the end user.

    The original poster probably got build to order machines. They would
    then come from the integrator and be shiiped directly to him. If they
    had been ready to ship, they probably would have been shipped from a
    stateside warehouse.

    The model number of the PC would indicate what type it was.

    This is not new.

    Craigm

+ Reply to Thread