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To: rudedog who wrote (47016)	6/10/1998 9:40:00 AM
From: Robert Scott Diver	Respond to of 176388

IBM announced the same thing re. direct sales and channel (as far as I can tell) within the past week. Scott

To: rudedog who wrote (47016)	6/10/1998 1:05:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176388

Rudy, CPQ's plan is to provide the infrastructure for direct sales but fulfill primarily from the channel. The channel gets less margin than for their own sales but also has less COGS. You seem to be arguing that the channel will act essentially as a warehouse for Compaq. If you think about what you've said it really implies that at least a portion of the channel could be used for phony sales. If the sale is made at the level of Compaq, then what is the function of the channel member? To assemble and ship BUT in order to do this it must first of all been carrying the inventory with which to assemble the machine. In other words, its really the same invitation to stuff the channels, but this time the channel member would have even less to say about it than in the past. I still think that Compaq must either jettison the channel completely for BTO stuff. The only time a distribution channel makes sense to me is if you are selling a shrink-wrapped product. TTFN, CTC