Computer & Peripheral Manufacturers
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 800 computer and peripheral equipment manufacturers in the US produce and assemble a wide range of computing equipment including computers, storage devices, terminals, and other peripherals. In addition to selling equipment, companies may sell software and installation, consulting, or IT management services.
Short Product Life Cycle
Computers and peripherals have a short product life cycle due to rapid advances in technology and evolving industry standards.
Price-Based Competition
As the computer and peripheral markets begin to mature domestically, growth has slowed, resulting in intense price competition.
Industry size & Structure
A typical computer manufacturer employs about 52 workers and generates $29 million annually; a typical storage device manufacturer employs 77 workers and generates about $68 million annually; and a typical peripheral manufacturer employs about 36 workers and generates about $12 million annually.
- The computer and peripheral manufacturing industry consists of about 800 companies that employ about 163,200 workers and generate $18.6 billion in sales.
- The computer and peripheral manufacturing industry is concentrated - the 50 largest companies hold just over 80% of industry sales.
- Large companies include Hewlett-Packard, Dell Technologies World, Cisco, Xerox and Lexmark.
Industry Forecast
Computer & Peripheral Manufacturers Industry Growth
Recent Developments
Jul 14, 2024 - Computer Storage Device Shipments Increase Year Over Year
- Shipments of computer storage devices increased 5.8% year over year and 46.3% month over month in March, according to the US Census Bureau. Computer and peripheral manufactures reduced prices slightly during the first five months of 2024, according to the US Bureau of Labor Statistics (BLS). Computer and peripheral manufacturing industry employment decreased slightly during the first five months of 2024 while wages for nonsupervisory employees increased slightly, according to the BLS.
- Bankruptcy filings continue increasing toward pre-pandemic levels, according to Fitch Ratings, and computer and peripheral manufacturers may be negatively impacted as a result. New filings increased year over year across all US major filing categories during the first quarter of 2024. Total commercial chapter 11 filings (including subchapter V) registered the largest increase, as the 1,894 filings during the first quarter of 2024 were up 43% from the 1,325 total commercial chapter 11s during the same period in 2023. Total overall commercial bankruptcies increased 22% in the first quarter of 2024, as the 7,113 filings surpassed the 5,820 commercial filings during the first quarter of 2023. Subchapter V elections for small businesses increased 30% to 606 filings in Q1 2024 from the 465 filed during Q1 2023.
- Computer and peripheral manufacturers benefiting from reshoring may also benefit from nearshoring, according to the Reshoring Initiative (RI). Harry Moser, founder of RI, says that if a product is so labor intensive that you can’t bring it to the US, then companies are sometimes surprised to find that wages in Mexico are far lower than in China. The average Mexican manufacturing worker earns $4 an hour, while the rate in China — where wages have been gaining 10% to 15% a year — is currently around $7, and in the US, it’s roughly $23. Products coming from Mexico end up with an average 40% US content, while in China they have 5% US content.
- Management consulting firm McKinsey has projected a shortage of 90,000 skilled technicians in the US by 2030. Computer and peripheral manufacturers may struggle to fill open positions as a result. McKinsey expects demand for technology skills to rise 20% above 2019 levels (based on hours) by 2030. Many firms are struggling on three fronts: talent acquisition, retention, and organizational health, according to McKinsey. Companies need to respond by getting a strategic grip on the challenge and creating career offerings at least as attractive as those of tech giants that have been more successful on these fronts.
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