• Home
• /
• Tech

Hewlett-Packard looks to leasing to prime sales

TAIPEI - Hewlett-Packard HPQ.N, the world’s top personal computer seller, said on Thursday it is exploring new ways to help businesses afford PCs as many cut back on spending in the current economic downturn.

These measures include leasing computers to firms that may be otherwise unwilling to buy new systems, said See Chin Teik, who heads the company’s personal systems division in Asia.

He declined to elaborate on specifics of any computer leasing plans that HP was developing.

“It’s a good assumption to make that more customers may need such help when credit and cash is tight,” See told Reuters in a phone interview.

HP may be exploring the move into leasing out of necessity rather than choice, said Reuben Tan, an analyst with IDC.

“Terms of credit have shrunk a lot, and some of their commercial partners may have difficulty accessing cash as easily as they could before.”

Tan added that leasing, while forcing HP to put up more cash for its customers, could also allow the company to broaden its revenue streams by leasing out entire computer systems in addition to individual computers.

“Margins are very low when you sell just a computer, but when you lease out an entire system complete with packaged software, while there is no immediate revenue stream, it may be good for the company in the long run,” he said.

HP is the market leader globally, selling 18.8 percent of all PCs worldwide in the third quarter by unit sales. Asia accounted for 16 percent of the company’s revenue in the most recent quarter.

The company currently trails Lenovo 0992.HK in Asia, but See said it wanted to continue to expand its reach in the region, especially in smaller cities.

“Looking at China, in addition to the factory we’ve already built in Chongqing, we’ll be working closely with our local partners to make sure that we have the correct products at the right prices,” he said.