HPE Is Incenting Distributors To Drive Silver, Business Partner Sales Growth

“Our biggest message to distributors is we will pay you more to focus on Silver, Business and Proximity partners because we don’t have as many resources there,” said George Hope, vice president of worldwide distribution for Hewlett Packard Enterprise. “I would say upwards of two thirds of our (distribution) spend is going to be for those partners. That is where the big commission rates are. That is where the dollars are (for distributors).”

Hewlett Packard Enterprise is paying its distribution partners more to drive sales through Silver, Business and even what it calls “proximity” partners that are not actively selling the HPE portfolio, said George Hope, vice president of worldwide distribution for HPE.

“Our biggest message to distributors is we will pay you more to focus on Silver, Business and Proximity partners because we don’t have as many resources there,” said Hope, who hosted 300 distribution executves from 100 different distributors at HPE’s Global Distribution Conference last week in Munich. “I would say upwards of two thirds of our (distribution) spend is going to be for those partners. That is where the big commission rates are. That is where the dollars are (for distributors).”

Hope said distributors can make the “most money” selling value products into the midmarket through Silver, Business and Proximity partners. “That is the home run ball,” he said. “That is where distribution can make the most money. That is the core business opportunity message that we delivered to distributors.”

The Silver, Business and Proximity sales charge comes with HPE stepping up its SMB (small medium business) partner charge with more aggressive pricing on its Smart Buy distributor offerings. Those Smart Buys are attracting Proximity partners who do not have a formal contractual relationship with HPE, said Hope.

”If you are a Proximity partner you have access through distribution to those (Smart Buy) specials,” he said. “We do a lot of business with non (HPE) partners who just wants to take us for a spin and take advantage of those really compelling offers so we can get an uptick and go take some share.”

HPE has been adding Silver, Business and Proximity partners at a rate of 2,000 new partners every quarter for the last six quarters, said Hope.

That said, Hope stressed that the focus is on incenting distribution to get those new partners actively driving sales growth rather than just adding new partner logos.

“It’s more about the yield per partner and the amount of revenue we are able to create,” he said. “The strategy is a combination of going wide and deep. More partners certainly gives us more opportunity to sell some of our core portfolio, but it also gives us an opportunity to sell emerging products as well by going further into the stack with some of the edge solutions through Aruba, selling Nimble storage, SimpliVity. It gives us a bigger audience but it is more about what we do with it once they are on-board.”

Nalit Patel, CEO of All Solutions, a Livingston, N.J-based solution provider, said HPE scores higher on support, pricing, MDF (market development funds) and technical resources through distribution than competitors.

“HPE is doing an excellent job working with distributors to support partners,” said Patel. “Without distribution we couldn’t function as an HPE partner. We need the distributor support around tools, configuration of systems and servers, configuration validation and inventory management.”

Patel said key to success in the SMB market for partners is face to face meetings aimed at determining exactly what are the customer’s pain points. “Our job as a VAR is to be like a psychiatrist – talking to the customers about pain points and what we can do to assist them,” he said. “When that happens you can see them get excited like popcorn in a microwave.”

That kind of consulting prowess helped All Solutions discover a 25 Terabyte Nimble sales opportunity that it is currently working on closing, said Patel.

Hope said HPE’s annual distribution conference is unique with a 100 percent focus on how distributors can build sales plans to drive growth working hand in hand with HPE channel executives. “It’s a chance to discuss our company distribution and channel strategy including how to leverage our SMB offers, marketing and how to get enabled on our Value products. Nobody in the industry does that. We had 600 executive one on ones. We had an hour and a half a day of plenary for three days and the rest of it was one one breakouts with the distributors.”