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 7,300 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 7,300 firms that employ about 306,000 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

                                      Jul 1, 2024 - Employment Increases
                                      • Computer and office equipment distributor industry employment increased slightly during the first four months of 2024 while average wages for nonsupervisory employees decreased slightly, according to the US Bureau of Labor Statistics. Industry sales have trended downward to pre-pandemic levels after peaking in March 2022, according to the US Census Bureau (CB). Inventories leveled off in late 2023 after a pandemic-driven increase but remain significantly above pre-pandemic levels, according to the CB.
                                      • The global PC market returned to growth during the first quarter of 2024 with 59.8 million shipments, increasing 1.5% year over year, according to International Data Corporation (IDC). Growth was mostly due to easy year-over-year comparisons, however, as the market decreased 28.7% during the first quarter of 2023, which was the lowest point in PC history. Global PC shipments finally returned to pre-pandemic levels as Q1 2024 volumes rivaled those seen in Q1 2019 when 60.5 million units were shipped.
                                      • The total amount of office space vacated since 2019 surpasses the amount vacated during the dot-com bubble and dwarfs that of the global financial crisis of 2007-08, according to real estate analysis firm Green Street. Computer and office equipment distributors may be negatively impacted by decreasing demand for office space. Available office space was about 25% of existing supply at the end of 2023, both historic highs. Prior recoveries in US office occupancy have been mostly “V-shaped” in nature - a sharp rebound from a big decrease. This cycle is likely to play out differently, however, as it will take a lot more new jobs to generate the same level of office demand as in the past because remote work will act as a long-term headwind on office demand, according to Green Street.
                                      • Workplace occupancy, an indicator of demand for office equipment, was 51.8% for the seven-day period ending on June 12, up from 51.6% for the seven-day period ending on June 5, according to data gathered from swipes of access control cards in buildings with security systems provided by Kastle Systems. Occupancy rarely hit the 50% mark from the early days of the coronavirus pandemic through early 2024 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 June 12 at 63.9%. The San Jose, CA, metropolitan area trailed all others tracked at 37.6%.
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