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Suning signs direct computer purchase deal with HP

(chinadaily.com.cn)
Updated: 2009-07-28 15:22

Suning Appliance reached a strategic cooperative agreement with Hewlett-Packard (HP) yesterday on direct computer purchases with the world's leading computer manufacturer.

The move will cancel out dealing with sales agents and will further raise Suning’s profitability in the much promising computer market.

The agreement comes after Suning, the second largest consumer electronic retailer in China, made other direct purchasing deals with major PC makers including Dell and Lenovo, and consumer electronic manufacturers including Haier and Whirlpool. More deals are expected to follow, according to analysts.

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Suning had previously been purchasing computers from sales agents HP appointed nationwide, which raised costs. The new deal will “improve profitability,” said Sun Weimin, president of Suning Appliance.

Since 2007, Suning has witnessed explosive growth of as high as over 100 percent in computer sales; HP accounted for more than 20 percent of the sales.

Under the agreement, Suning is expected to sell out HP computers worth 1.5 billion yuan this year, and sales in the next three years will be over 5 billion yuan.