3/07/00 - Compaq To Franchise Australian Retail Stores 03/05/00
SYDNEY, AUSTRALIA, 2000 MAR 5 (Newsbytes) -- By Dorothy Kennedy, Computer Daily News. In a move
which may have implications for the US retail sector, Compaq Australia [NYSE:CPQ] is making a move
toward franchising its controversial "Compaq Connect" retail stores.
Compaq last year stirred up a hornet's nest with leading Australian retailers, after it began opening
company-owned Compaq Connect stores in Melbourne and Brisbane.
The stores offer configure-to-order Prosignia and Presario model PCs and peripherals to small business
and "IT-experienced" consumers, with delivery promised within a few days.
One leading retail chain, Harvey Norman, dropped Compaq PCs completely from its shelves, in retaliation
for Compaq Australia's actions; Harvey Norman had previously handled sales of Compaq products
estimated at between A$70 million and A$100 million (US$42.31 million and $60.45 million).
In October Melbourne-based Coles Myer chain made a threat of similar action - withdrawn after Compaq
agreed to hold the numbers of company-owned stores at eight, and to explore opportunities for joint
Compaq-Coles Myer ventures.
Coles outlets include the Australian Kmart, Office Works, Myer and Grace Bros chains - a formidable swag
of the Australian retail scene.
After a four-month hiatus, Compaq consumer director Rob Balmer has confirmed that Sydney's first
Compaq Connect store will open later this month, according to trade journal Australian Reseller News.
But unlike the Compaq-owned stores in Melbourne and Brisbane - now termed "pilot sites" - the Sydney
store will be a franchised operation, owned by an so-far unnamed Compaq channel partner, he said.
Balmer told Australian Reseller News that he's interested in hearing from other operators interested in
taking up Compaq Connect franchises.
The Australian Reseller News story claims the Australian stores are being trialled as the model for
possible similar operations in other territories, including the US.
Original plans were for up to 100 franchised Compaq Connect stores across Australia, if the original eight
proved successful.
Exchange Rate: $1 = A$1.65
Reported By Newsbytes.com, newsbytes.com
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