'What does HP do?' asks Europe's biggest dealer

Mike Norris, the plain-speaking chief executive of Computacenter, has launched a scathing attack on Hewlett-Packard - the firm's principal trading partner.

Talking to The Independent, Norris said: "If you look at it, what do they [HP] do? What's their job? The software is made by Microsoft, Intel make the processors, that's where the value is. They don't make hard drives. They don't make the memory chips and they don't make the tin [the casing] itself. They certainly don't assemble themselves. What is it that HP do?"

A tough question for the ink specialist but perhaps a bit harsh from a firm which sells so much HP kit.

Norris went on to provide his own answer. "If you ask them, they say brand and quality, a little bit of design. There are two ways out of that. One is to get customer control and sell direct, the other is to try and get costs out and help that way. It's not a great place to be if you are HP. At least with us, we advise, we install. I can say what we do. There's not a lot of value left in the middle, it's difficult to justify a margin."

HP sent us a statement saying, "HP does not disclose information about its operations or business partner organizations. This information is company confidential and is a matter for HP and its channel partners."

Computacenter yesterday posted £67m in profits for 2004, up slightly on slightly lower turnover which it blamed on falling hardware prices. The firm also said that re-negotiations with HP will knock £10m off profits this year. ®

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