Synnex Teams with MaintenanceNet to Manage HP Service ContractsBy Scott Ferguson | Posted 2006-07-24 Email Print
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The service contract management agreement has the potential to lead to higher profits for distributors, VARs.
Distributor Synnex is partnering with MaintenanceNet, an online management company, to help manage and track service contracts with one of its largest product linesHewlett-Packard.
The partnership allows Synnex, based in Fremont, Calif., a way to increase revenue for itself and its VARs through service contracts on HP hardware, as well as a way to provide greater customer satisfaction, Michael Cook, director of product management, said.
The agreement between the two companies was announced July 24, but the two have been working together for several months, company officials said.
Maintenance service contracts have increasingly become a lucrative market for channel distributors and VARs, said Scott Herron, CEO of MaintenanceNet.
About 50 percent of such service contracts currently are allowed to expire, according to analyst firm IDC, of Framingham, Mass. That means VARs and integrators could be missing out on a lot of potential revenue.
Herron said the Carlsbad, Calif., company gives distributors and VARs a Web-based program that allows companies to track service agreements and know what information is contained in the contracts.
After automatically gathering all the information about maintenance service contracts, MaintenanceNet will alert distributors and VARs by e-mail.
These e-mail alerts are typically sent out 30, 60 and 90 days before the service contract expires.
These notification can also alert VARs and distributors about potential new products. A company's sales force can then offer users new hardware or updates to a software application instead of just renewing the service contract.
"Channel partners are getting more into the service business and this is profit that is literally right there," Herron said. "We allow them to pull up this information and then they can go out and mine the customer base with service contracts on products that have already been sold into the market place."
In the next six months to year, Herron predicted that VARs will begin allowing users access to some of the data MaintenanceNet collects, which will allow them to keep track of their own service contracts.
In addition to the potential profit, Cook said HP and other hardware users are also looking for service.
Cook added that users want the ability to look at a contract and know who to call about maintenance problems with their hardware and how soon the equipment can be fixed.
Though Synnex was starting with its HP products, it could expand the partnership to other areas of its product line, Cook said.