The average trade price of computers in Britain shot up by almost a third in the past year since the EU referendum, though a weakened pound might not tell the whole story.
According to distributor data collated by channel analyst CONTEXT, average sales prices (ASPs) for desktops, notebooks and workstations reached £480 in July and August, up 30 per cent on the same months in the prior year.
Component shortages in areas including memory, a shift to higher-spec machines and fewer sales to lower-margin retailers were also behind the hike, Marie-Christine Pygott, CONTEXT senior analyst, told The Reg.
"But it looks like currency issues had the biggest impact," she said. The average price of PCs sold by distributors in the eurozone went up 12 per cent year-on-year during the period in question.
The pound sterling crashed against the US dollar after the majority of Brits (that voted) opted to leave the EU in June last year. Subsequently, US vendors decided to offset the currency movement by upping local prices.
Dell was the first mover, followed by HP Inc, Lenovo, Apple, Asus and every other PC maker. Some vendors have continued to raise their prices to UK distributors even though the pound staged a mini-revival against the dollar – clearly no vendors are in a rush to chop them again.
CONTEXT said the local price rises had knocked sales volumes in the UK, which were down by double digits in July and August compared to the same period a year ago.
Distributors, who spoke to us on condition of anonymity, said the hike seemed a little extreme but agreed with the contributing factors.
Pygott reckoned wholesaler prices had stabilised and didn't expect dramatic movement one way or the other over the following quarters.
Back in June, the now ex-president at Dell, David Goulden, said component issues meant it had been forced to revisit customers' orders to talk "about raising prices on their existing orders".
"Customers, of course, don’t like paying more for what they paid for last quarter, typically in IT that’s not been the case. Typically, in the IT industry, there are expected price decreases on a sequential basis, not price increases," he said on a con-call to discuss financial results.
"I've spent my life in sales, a large part of it in any case. And one of the hardest things that any salesperson ever has to do is to stand in front of a customer and convince them why their price has to go up, either through currency or cost headwinds or other issues that impact the business. ®