Compaq Japan Recruits Net Sales Partners

In a move aimed at boosting its 4 percent
Japan PC market share and strengthening its online marketing presence,
Compaq Computer KK is bringing its traditional indirect sales channel model to the Internet.

In cooperation with Santec Corp., a leading PC wholesaler and e-commerce
technology provider, Compaq Japan has launched an initiative called
e-Kiosk for Compaq to recruit retailers to sell Compaq products online.

Okayama-based Santec will use its e-Kiosk infrastructure and expertise
to set up and manage a Compaq Net Shop website for each merchant
interested in selling Compaq products on the Internet.

“We will handle all the online sales tasks, from establishing and
administering the Internet shop to managing inventory and expediting the
delivery of purchased goods,” said Santec.

“The retailer fundamentally just has to solicit customers and confirm
order receipt and product delivery.”

A campaign to recruit e-Kiosk for Compaq merchants began on Monday and
will run through October 29.

Target participants are Japan-based computer retailers and would-be
online PC merchandisers, such as office supply stores and computer

Online sales through the e-Kiosk for Compaq program will begin in

Compaq Net Shops will be able to sell all Compaq PC models — the new
“designed-for-Japan” ProSignia family, which Compaq Japan has been
selling direct by phone and through its own website since early July,
and the Armada, DeskPro, and ProLiant series, which it offers mainly
through resellers — as well as third-party products and peripherals.

As much as 95 percent of Compaq Japan’s sales have traditionally come
through the indirect (reseller) channel.

Although Compaq holds the top global PC market share, in 1998 it ranked
just seventh in the Japanese PC market with a 4.3 percent share —
behind NEC, Fujitsu, IBM, Toshiba, Hitachi, and Apple, and only slightly
ahead of Sony and Dell.

Compaq Japan said it hopes to sign up 300 Compaq Net Shop retailers this
year, rising to as many as 2,000 next year.

Participating retailers can select from two online sales models,
becoming either a “reseller shop” for a setup fee of 90,000 yen (US$833)
and monthly management fee of 30,000 yen (US$278), or an “agent shop”
for a setup fee of 60,000 yen (US$556) and monthly management of 10,000
yen (US$93).

Both sales model fees include server rental, management, and

“Through this service,” said the partners in announcing the e-Kiosk for
Compaq program, “we are revolutionizing the conventional distribution
model. Our aim is to construct a new distribution model for tomorrow’s
Internet society.”

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