by Seth Fineberg

Palo Alto/Mountain View, Calif. — As computer product manufacturer Hewlett Packard and accounting software vendor Intuit Inc. continue to work out the details of their small-to-midsized business initiatives, the one thing that seems clear is that QuickBooks products — its Enterprise Edition, in particular — are about to get some promotional muscle.

In late March, Intuit and HP entered into a non-binding “Memorandum of Understanding” to sign an agreement for jointly marketing QuickBooks financial management solutions with HP PCs and servers. The two were still ironing out the details of the relationship at press time, but brought their general objectives to light.

According to both parties, the intent of the relationship is to deliver a range of products and services to help small businesses get started and grow — particularly as they move from a PC-based business to their first server. As part of the deal, QuickBooks Enterprise — which had mostly been sold directly through Intuit — will be available on a new, “low-price-point” HP small business server. HP and Intuit also intend to market and sell the joint offerings through a variety of channels, including Web sites, tele-Web and HP’s resellers, which currently total 20,000 in the U.S. and nearly 200,000 worldwide.

There are currently 7,000 QuickBooks Enterprise customers, and the deal could very well give those numbers a needed lift.

“QuickBooks Enterprise is tailored towards the growing SMBs that have needs, but they also have other needs we couldn’t meet easily by ourselves,” said Dan Levin, vice president of Intuit’s QuickBooks group. “The larger small business infrastructure is more sophisticated than a typical small business, and we know these customers like to work with local, value-added resellers to deliver installation and configuration services. HP has the network, and in developing the new [SMB] server that combines the QuickBooks Enterprise product, we think we can do a better job delivering for customers.”

There were no further details about what products would be made available on HP PCs, but Levin believed that some customers would want pre-installed solutions. He also said that Intuit has several original equipment manufacturers that offer QuickBooks products as an add-on to customers who purchase them, and that those efforts “have gone well.”

As for actual marketing plans, Nigel Ball, HP’s vice president for small and medium business server storage and software, said that it was “fair to assume we will use a full range of tools to execute this effort, and it’s important to know the marketing work is targeted through multiple channels.”

Ball also said that this relationship is part of HP’s multi-tiered, smart office initiative for small and midsized businesses. This particular tier is focused around “offering SMBs key business process functions — specifically accounting, enterprise resource planning and customer relationship management.”

Even QuickBooks consultants agreed that, from what they know about the HP-Intuit relationship, QuickBooks Enterprise is at a clear advantage.

Bruce Andersen, of Woodland Hills, Calif., has been recommending QuickBooks and consulting with users for years, and is well aware of the challenges that Intuit has had in selling its Enterprise product. And he believes that may very well change.

“If, in fact, the whole initiative is to crank up Enterprise, it’s a great strategy because it’s a product that may need some onsite services and support, and selling it as a mail order or over the phone really isn’t working,” Andersen said. “Having a 10-user accounting system is still a huge market [that Intuit] has not captured yet, and for them to admit their sales are lagging and want to jumpstart it, it’s genius.”

Andersen also explained that, while QuickBooks Enterprise has an attractive entry price ($3,500 for a 10-user system) and tech support (24 hours a day for one year unlimited, with an individually assigned representative on call during work hours), there are still issues that have “held the product back.”

“QuickBooks Enterprise hasn’t gotten much traction because when people move to it from [QuickBooks] Pro they blow through it,” he said. “It’s an easy upgrade [from QuickBooks Pro], but in three to four months, users have blown through the database capabilities, reports don’t run and the program gets sluggish. The QuickBooks database is one file, so if it crashes, it crashes and burns, and they need to work on that.”

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