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 7,400 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 a single location, employs fewer than 20 workers, and generates about $46 million annually. The average office equipment distributor also operates out of a single location and employs fewer than 20 workers, but generates about $18 million annually.

    • The computer and office equipment distribution industry consists of about 7,400 firms that employ about 304,400 workers and generate about $290 billion annually.
    • Computer and computer peripheral distributors account for 73% 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, 2024 - Sales Vary As Economic Uncertainty Continues
                                      • Industry sales varied considerably during the first nine months of 2023, according to the US Census Bureau. Distributors were selling down their inventories during the first quarter of 2023, which contributed to lower inventory value, but inventories leveled off through the third quarter. Labor costs decreased during 2023 as industry employment and wages for nonsupervisory employees decreased slightly, according to the US Bureau of Labor Statistics.
                                      • Commercial Chapter 11 bankruptcy filings increased 72% year over year in 2023, according to Epiq AACER. Bankruptcy filings may reduce spending on computer and office equipment. Overall commercial filings increased 19%. Subchapter V bankruptcies within Chapter 11 increased 45% during the period. “Though still below pre-pandemic figures, bankruptcies in all filing categories climbed last year amid the evaporation of pandemic emergency responses, increased interest rates and tougher lending standards,” said Amy Quackenboss, executive director at the American Bankruptcy Institute.
                                      • The US office vacancy rate rose to a record-breaking 19.6% in the fourth quarter of 2023, according to Moody’s Analytics. More US office space is currently empty than at any point since 1979. Increasing office vacancy may negatively impact sales of computer and office equipment. Suburban office spaces fared better than those in cities due to their proximity to residential communities and, in some cases, shorter commute times for employees.
                                      • Workplace occupancy, an indicator of demand for office equipment, was 51.8% for the seven-day period ending on February 21, up from 50.4% for the seven-day period ending on February 14, 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 coronavirus 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 21 at 64.9%. The Philadelphia, PA, metropolitan area trailed all others tracked at 43.3%.
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