IT Supply Chain Developments and Their Impact on Buying Decisions

Ian Nethercott, MCIPS, Supply Chain Director at IT digital marketplace Probrand,  continues his monthly roundup of the latest movements in the market for IT category buyers. 

The sheer number of new products landing on the market each day makes IT one of the most challenging categories of procurement. For buying teams, keeping up with the pace of change can create a series of headaches when considering weighing up what to buy and when. Can you afford to wait six months until that new smartphone is no longer at a premium price? Or are the features it comes with worth the costs if they’re going to help drive employee productivity?

Making an informed purchasing decision may involve looking at patterns over time and evaluating several factors – from golden oldies like the impact of currency fluctuations to sociopolitical events which could even include the forming of a new political party.

To help navigate this complex landscape, here are some of the latest developments and major movements that are influencing key IT product categories.

Exchange Rate

Towards the end of last year, it was all sunshine and rainbows for fluctuating exchange rates. It was a very different story in January however, when a dark cloud descended. What started as an okay month for the euro against the GBP, turned into a nightmare.

The euro started at 0.8978 and rose to 0.9037 by January 3. From there it dipped and recovered, before falling hard, hitting 0.8803 by January 18 and 0.8836 by January 26-27. A slight rise saw the euro end the month at 0.8746.

It was slightly less depressing against the USD. The euro started at 1.1461 and dropped to 1.1374 by January 3. From there it recovered and rose to a high 1.1529 on January 10, only to then steadily fall, hitting 1.1461 on January 12 all the way down to a low of 1.1348 by January 24. A recovery soon followed, ending the month up, at 1.1477 on Jan 31.

The economy didn’t fare well in January either. Italy fell into recession and PMI dropped to 51.1 – the first time that business demand has fallen in four years.

Phones and Tablets

Trends reports from 2018 are still filtering through with IDC reporting a 4.9% YoY drop in Q4 to 375.4m units and a further -4.1% YoY for 2018 to 1.4bn units.

Samsung topped the vendor list in Q4 2018 – even though it dropped 5.5% YoY to 70.3m units and 18.7% market share. Apple came in at second, with -11.5% YoY to 68.4m units and 18.2% share, followed by Huawei (+43.9% to 60.5m and 16.1%), OPPO (+6.8% to 29.2m and 7.8%) and Xiaomi (+1.4% to 28.6m and 7.6%).

According to TrendForce, global smartphone production volumes reached 383m units in Q4, with volumes expected to drop a further 10% to 307m units in Q1 2019. Trendforce also predicted that Android will drive 5G smartphone adoption and is set to reach 0.4% of the market in 2019.

Traditional PCs

Gartner announced that global PC shipments fell 4.3% YoY in Q4 to 68.6m units and fell 1.3% YoY for 2018 to 259.4m units. According to the report, Lenovo toped the Q4 market with 5.9% YoY growth to 16.62m units and 24.2% market share, ahead of HP (-4.4% to 15.38m and 22.4%) and Dell (+1.4% to 10.91m and 15.9%). Apple and Ass rounded out the top five.

Lenovo also led the market for 2018 shipments, registering 6.9% YoY growth to 58.46m units and 22.5% market share. HP came in number two with +2.1% to 56.33m and 21.7%, followed by Dell (+5.3% to 41.91m and 16.2%), Apple (-5% to 18.01m and 6.9%) and Acer in fifth (-7.9% to 15.72m and 6.1%).

Premium Ultramobiles & Wearables

ABI Research said that Apple’s share in the smart watch market is on the decline, with 2H results dropping below 45%. Demand and competition are set to challenge Apple’s grasp on the market but whether it’ll be able to hold on is a different matter.

Monthly statistics

January saw a relatively low number of new products coming onto the market with 310 products launched between January 4-6 compared to a high of 7,460 new products launched the previous month.

The highest number of price increases happened on January 28, with 35,976 price hikes occurring across a variety of product categories. At the opposite end of the scale, price decreases in January hit a high of 57,748 on January 29 which was a big leap from a high of 17,861 in December.



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