Computer & Office Equipment Distributors

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 7,900 computer and office equipment distributors in the US serve as middlemen between manufacturers and retailers/resellers and end-users. Major revenue categories include computers, computer peripheral devices, office equipment, and computer software. Office equipment includes copiers, point-of-sale terminals (POS), automated teller machines (ATMs), cash registers, mailing machines and check handling machines. Companies may also provide services, such as repair, maintenance, technical support, systems assembly, systems integration, and training.

Rapidly Changing Technology

The IT arena is characterized by rapid change in technology and evolving industry standards and product specification requirements.

Price-Based Competition

Intense price-based competition in the information technology products and services market creates consistent pressure on margins.

Industry size & Structure

The average computer and computer peripheral distributor operates out of 1-2 locations, employs about 39 workers, and generates about $48 million annually. The average office equipment distributor operates out of 1-4 locations, employs about 33-34 workers, and generates about $17 million annually.

    • The computer and office equipment distribution industry consists of about 7,900 firms that employ about 298,600 workers and generate about $314 billion annually.
    • Computer and computer peripheral distributors account for 72% of firms and 88% of industry revenue.
    • The industry is concentrated; the top 50 computer and computer peripheral distributors account for about 76% of category revenue and the top 50 office equipment distributors account for about 77% of category revenue.
    • Large companies, which include Ingram Micro, Tech Data, and SYNNEX, may have international operations. Computer and office equipment manufacturers may have distribution operations.
                                      Industry Forecast
                                      Computer & Office Equipment Distributors Industry Growth
                                      Source: Vertical IQ and Inforum

                                      Recent Developments

                                      Mar 1, 2023 - Right To Repair Movement Gains Momentum
                                      • Proposals in at least 23 states would require electronics companies and other manufacturers to make the tools, parts, and information needed to fix their products reasonably available, according to Bloomberg Law. The state-level activity follows first-in-the-nation laws in New York and Colorado. Opponents, from John Deere equipment dealers to groups representing Samsung and Apple, have said that company-authorized repair programs benefit consumer safety. Opponents also raised concerns that the bills would violate intellectual property protections.
                                      • The New York state legislature passed in June 2022 the country's first “right to repair” bill covering electronics, but some experts say that amended language added before the bill was signed into law in late December makes it toothless. The Digital Fair Repair Act, which goes into effect on July 1, 2023, requires manufacturers to provide owners and independent repair shops the manuals, parts, diagnostics, and diagrams necessary to repair “digital electronic equipment.” There are some carve-outs, including cars, home appliances, medical devices, off-road equipment, and enterprise devices used by data centers, schools, and hospitals. The legislation only applies to items manufactured after July 1, 2023, and it doesn’t require manufacturers to volunteer any security unlocking codes needed to repair a device. It also lets the manufacturers decline to deliver specific components if they think “the risk of improper installation heightens the risk of injury.”
                                      • The US office vacancy rate, an indicator of demand for computer and office equipment, was 18.7% in Q4 2022, up from 18.5% in Q3, and 18.1% in Q4 2021, according to real estate analytics firm Reis. It was the highest vacancy rate for offices since 1992. Demand may decrease as the vacancy rate increases.
                                      • Workplace occupancy, an indicator of demand for office equipment, was 50.1% for the seven-day period ending on February 22, up from 49.8% for the seven-day period ending on February 15, and 48.6% for the seven-day period ending on February 8, according to data gathered from swipes of access control cards in buildings with security systems provided by Kastle Systems. Occupancy has rarely hit the 50% mark since the early days of the pandemic despite attempts by many organizations to bring employees back. The Austin, TX, metropolitan area had the highest occupancy for the seven-day period ending on February 22 at 66.4%. The San Jose, CA, metropolitan area trailed all others tracked at 41.2%.
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