IT Supply Chain Developments and Their Impact on Buying Decisions

Al Nagar, Head of Benchmarking, KnowledgeBus, Mercato Solutions, continues his series of monthly advisory pieces sharing recent movements and impactors within key IT product categories, to keep you up to date with the latest developments and help support your purchasing decisions.

September was another turbulent month with currency woes dominating the conversation for IT buyers. With Brexit talks scheduled to commence by March 2017, the pound was once again sent on a rollercoaster. Inflation also hit its highest level in over two years, up from 0.2% in August to 0.4% in September, contributing to a series of dramatic rise and falls.

Exchange Rate

The Brexit backlash continued to cause several ripple effects for the pound and euro; most recently, we saw the British pound hit a 31-year low against the dollar. There’ll no doubt be more on this in next month’s post as the impact becomes more noticeable.

Meanwhile, in September, the euro fell quickly against the pound from 0.8452 to a monthly low of 0.8371 on September 6. From there, it enjoyed a series of slow increments, eventually rising to 0.8673 by September 26 before a slight drop, ending the month at 0.8643.

Against the US dollar, the euro started out at 1.163. It enjoyed a quick rise on September 2 to 1.1185 before falling to 1.1152. It peaked on September 8 at 1.1261 before falling to 1.1242 on September 15. From there it plateaued, bottoming out at 1.1154 on September 17. A few rise and falls later, the euro finished the month at 1.1211.

Phones and Tablets

Global smartphone shipments are poised to reach 1.46bn units in 2016, representing a 1.6% YoY growth. IDC claimed that Android will increase shipments 6.7% to 1.2bn units for the year while maintaining an 85.3% market share, followed by iOS with a 12% drop in units shipped to 203.8m and 13.9% market share. The Windows phone is expected to come in at third place with 7.2m units shipped. In line with this, its shipments are expected to be down 75.2% YoY, holding on to just 0.5% of the market.

Traditional PCs

According to a report from FutureSource, it has been a challenging year for personal computer sales, particularly in the education sector. First half-year sales were down 12% YoY in 2016 from 14m to 12.4m units. According to the report, global shipments in this sector will rebound in 2017 and look set to enjoy a 19% growth to over 30m units.

Premium Ultramobiles/Wearables

The FutureSource report predicted that hybrid 2-in-1 devices will make a big splash in the US market, growing from 6% of device shipments in 2015 to 18% in 2017.

On the back of the new Apple Watch, global smartwatch shipments are expected to grow 3.9% YoY in 2016 to reach 20.1m units, and continue to grow to 50m units by 2020.

According to a report from IDC, watchOS will reach 10.5m units and gain a 52.3% market share in 2016. This is followed by Android’s competing Wear operating system in second place with 4.6m units and 22.9% market share.

Workplace wearables will reach 83m units and $14bn in revenue by 2021. According to ABI Research, this growth will come from productivity boosting wearable scanners such as ring barcode scanners, smart glasses and glove scanners.

 

Stat of the month: The largest amount of new products coming on the market occurred on September 16, with 43 products being launched in a single day.

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