Trade-in top up for Cisco channel partners

Cisco will officially launch a Trade-In Accelerator Programme next week. The scheme offers partners a 15% back-end rebate against the trade-in value of products that their customers exchange using the existing Cisco Migration Trade-In Programme (CMTP).

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By  Stuart Wilson Published  April 5, 2005

Cisco will officially launch a Trade-In Accelerator Programme next week. The scheme offers partners a 15% back-end rebate against the trade-in value of products that their customers exchange using the existing Cisco Migration Trade-In Programme (CMTP). Cisco believes that the trade-in accelerator programme will stimulate end-user migration to advanced networking technology and will also help boost partner profitability. Edison Peres, VP worldwide channels for advanced technologies at Cisco, explained: “CMTP offered end-users a dollar value for the products that they traded in. This programme has been very successful but the partners have never participated in that programme – it has been end-user focused. “What we are announcing here is that in the US, Canada and Europe, Middle East and Africa (EMEA), we are going to have a rebate programme tied to the [CMTP] programme. In other words there will be a 15% rebate paid back to the partner for the utilisation of the programme. So it is not only the end-user that gets the benefit by getting the value for the trade-in,” continued Peres. According to Cisco, there is some US$40bn of ageing switches and router products in the global marketplace, offering a prime opportunity for the channel to sell upgrades into this massive installed base. Cisco wants its latest channel initiative to grab 5.5% of that installed base during its first year – equating to US$2.2bn in incremental revenue. “What this programme is trying to do is help not only the end-user see the benefit, but also stimulate the partners by giving them some additional incentive to migrate this base and see more opportunity,” added Peres. “This 15% is paid as a rebate; this is not intended to go to the street as an additional discount. So it is paid after six months. In other words, these rebates accrue for six months and then we cut a cheque for the partner. We are introducing this programme to cover both Cisco products and competitive products,” Peres concluded. For example, if a customer trades in existing products for Cisco products and receives a US$100 rebate, the partner will receive US$15 as a rebate six months down the line. Paul Mountford, senior VP worldwide channels at Cisco, announced the new scheme to rapturous applause from more than 2,000 members of the channel community during his keynote address at the networking giant’s annual partner summit. “When a trade-in occurs, the customer has normally got all of that value,” said Mountford. “So if you can get customers to trade up, we are going to give you an incentive for doing that too. We are actually going to give you 15% of that trade-in value, which equates to something like 3% to 5% extra margin on the infrastructure sale.”

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