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back to article HP refuses to make suicidal leaps on pricing

Hewlett Packard has walked away from some hardware deals in the UK as the recession encourages other vendors to adopt "suicidal" pricing policies to chase corporates' shrinking IT spend. The firm's UK boss said at a meeting in London today that it was banking on a "flight to quality" in the market, as customers reel from the …

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  1. Richard Tobin

    Which competitors?

    For those of us who don't care whether the supplier is still around in seven years, can you provide a list of the suppliers making "suicidal leaps" please?

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  2. Ian Michael Gumby
    Black Helicopters

    @ Richard...

    Contrary to the statement, all of the vendors are willing to make suicidal leaps on pricing if you play them correctly. ;-)

    You just have to know which buttons to push. ;-)

    If you read between the lines, what the article is saying is that the vendors are now probably forcing their sales staff to go higher up the food chain in order to get the higher discounted prices approved. And on hardware pricing, you don't have to really sell it at a loss to be in the 'suicidal territory'. If you add in the commissions and the cost of the local sales support engineer, you could still sell it above cost and still lose money on the deal. (YMMV)

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  3. Henry Wertz Gold badge

    Smart

    "Hewlett Packard has walked away from some hardware deals in the UK as the recession encourages other vendors to adopt "suicidal" pricing policies to chase corporates' shrinking IT spend."

    This is smart. Pumping up some "sales volume" figure, but losing money on every sale, is not smart. I can easily see some companies doing this so they don't show a sales drop.. but you don't make up "losing money on every sale" in volume.

    Quite a turnaround from the old days of the Itanic. I was talking to someone from a University department here, this was like 5 years ago.. HP sold them a Itanium-based HP Superdome system for like $1000.. it was a $100,000 system. They simply wanted to show SOME Itanium sales that year, and that was how they did it. When they bought it, the (several year old) HP Superdome PA-RISC system they already had was spanking the Itanium Superdome. I guess with later compiler improvements, they at least ran neck-and-neck, and eventually the Itanium ran slightly ahead. But probably not $100,000 ahead 8-). This is DEFINITELY not the kind of game you want to play if you're looking to keep the balance sheets out of the red though, and it appears HP has realized this.

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