IT Supply Chain Developments and Their Impact on Buying Decisions

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

From Brexit being delayed to security concerns over Huawei and 5G, the headlines in April were not altogether positive – and this extended to the IT channel. Shipments of mobile phones, tablets, PCs, panels, and printer shipments all fell; DRAM prices continued to slide, and the memory and semiconductor industries posted large losses. There was some light, though, with premium ultramobile devices forecast for shipment growth and both smartwatch and curved monitor displays are up.

To make sense of the chaos, here are some of the latest developments and major movements that are influencing key IT product categories.

Exchange Rate

What started poorly ended positively for the euro against the pound. After dropping from 0.8597 on April 1 to a low of 0.8537 on April 3, the euro then rose – first to 0.8593 by April 5 and then to 0.8662 by April 17. From there it dipped and recovered before falling to 0.8622 by April 27, ending the month at 0.8621.

It was a different story for the euro against the dollar. Starting at 1.1223, there was a minor dip before it rose steadily to 1.1307 by the middle of the month. The euro then fell against the USD, hitting 1.1240 by April 20 and 1.1141 by April 25, where it sat flat for three days until a small rise saw it end the month at 1.1204.

Despite the ups and downs, according to both The Guardian and Reuters, there was a lot of good news coming out of the eurozone in April. The Italian recession was officially over thanks to 0.2% growth, eurozone unemployment fell to 7.7% (its lowest since the crash of 2008), and the eurozone economy grew at 0.4%.

Phones and Tablets

Analysts Gartner said that global mobile phone shipments will fall 0.5% YoY to 1.8bn units for 2019 and, despite expecting a 1.2% YoY rise in 2020, the market will fall again, to under 1.8bn units for 2021. It also noted that foldable phones will start to have a real impact in 2023, with 30m units shipping, accounting for 5% of high-end smartphone market sales.

IDC said global smartphone volumes were down 6.6% YoY with 310.8m units shipped in Q1, registering the industry’s sixth quarterly decline. Despite dropping 8.1% YoY, Samsung topped the Q1 vendor list with 71.9m units shipped and 23.1% market share, ahead of Huawei (+50.3% to 59.1m and 19%), Apple (-30.2% to 36.4m and 11.7%), Xiaomi (-10.2% to 25m and 8%) and Vivo (+24% to 23.2m and 7.5%).

Gartner said tablet shipments will continue their annual decline with shipments to fall from 149.56m units in 2018 to 147.96m in 2019, 145.81m units by 2020, and 143.7m by 2021.

Traditional PCs

Global PC shipments fell 4.6% YoY in Q1 to 58.52m units, according to Gartner. Lenovo topped the list with 6.9% YoY growth to 13.16m units and 22.5% market share, ahead of HP, Dell, Apple and Asus.

Western Europe PC sales by volume fell 2.4% YoY in Q1 on the back of weak consumer demand and chip supply, according to Context. It added that the consumer market dropped 11.3% YoY, with the UK alone down 17.6% amid low confidence because of Brexit. Across the region, commercial sales enjoyed 4.6% YoY growth.

IDC on the other hand said Western Europe’s PC market grew 2.8% YoY in Q1, on the back of commercial sales enjoying +10.7% YoY.

Meanwhile, Gartner said global PC shipments will fall 0.6% YoY in 2019 to 258.34m units and continue to fall to 254.92m by 2021.

Finally, IDC predicted that global gaming desktop, notebook and monitor devices will combine to grow 8.2% YoY in 2019 to 42.1m units and continue to grow 9.8% YoY to 61.1m units shipped by 2023. In that year, desktops will account for 19m units, notebooks 31.5m, and monitors 10.6m, up from 15.5m, 20.1m, and 6.4m respectively in 2019.

Printers

According to Channel Pro, Sharp enjoyed the highest growth of all office equipment supplies for 2018, most notably a 16% YoY growth in multifunction printer shipments. Despite the good news for Sharp, in Q4 the printer market dropped 4.8% YoY to 26.7m units, with all but HP (+3.6%) said to have posted declines, the biggest coming from Epson with -15.2% YoY.

Monthly statistics

April saw a relatively large number of new products come onto the market with 5,106 launched on April 15 compared to a high of 2,922 on March 18.

The highest number of price increases happened on April 1, with 61,633 price hikes occurring across a variety of product categories. At the opposite end of the scale, price decreases in April hit a high of 34,463 on April 4, which was significantly higher than the high of 2,795 in March.

How To Buy IT for Less

And here's Ian explaining IT insights for buyers this month:

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