With the virtual disappearance of hard prices from the UK 3090 market, IBM UK has had to arm its sales teams with guidance on just what special inducements they can offer customers. Naturally, almost all the options are designed to increase the customer’s dependence on IBM as a supplier. The most significant is a generous discount for customers who decide to replace two old processors with one new own. The most interesting, although unlikely to win much additional business, is the offer of savings on the first Extended Systems Architecture machine bought by a customer that runs its workload under VM – problem is that there is as yet no ESA version of VM. Customers are also being told that a testing allowance, which IBM will subsequently translate into to a Deferred Payment, may be available for those looking to upgrade from a Model 400 to a Model 600. On the conversion front, IBM is suggesting deferral of a system conversion payment to allow for disruption, adding that the deferral can be converted to a cash price reduction. There are also a number of price protection offers on upgrades. For customers who indicate from the outset that they will be taking certain upgrades, IBM is prepared to offer up to two years’ price protection without the customer having to provide precise upgrade dates. However, the offer does stipulate a 1% liquidated damages clause. It is also offering up to 120 days post delivery/installation price reduction protection, depending upon the contract date. IBM is also telling its sales teams to be flexible about payments, suggesting that customers can negotiate to delay payment, albeit at a cost, and offering price concessions to those who agree to pay in advance. And, once an order has been confirmed, it will guarantee that customers pay the lowest processor price from order date, for a period of up to 120 days prior to installation, with the possibility of rebates if the product price falls after delivery. The rebate will reimburse customers after installation, for the number of days that elapsed between the order being confirmed and subse quent installation of the product.
