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 880 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 880 companies that employ about 163,100 workers and generate $21 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
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Mar 19, 2024 - Prices Decrease
                                  • Computer and peripheral manufactures decreased prices slightly during the first nine months of 2023, according to the US Bureau of Labor Statistics (BLS). Computer shipments surged during the first half of 2023, returning to pre-pandemic levels before decreasing slightly through September, according to the US Census Bureau. Shipments of computer storage devices increased moderately during the first nine months of 2023 and are approaching pre-pandemic levels, according to the US Census Bureau. Industry employment was unchanged during 2023 while wages for nonsupervisory employees increased moderately, according to the BLS.
                                  • Commercial Chapter 11 bankruptcy filings increased 72% year over year in 2023, according to Epiq AACER. Bankruptcy filings may reduce spending on computers and peripherals. 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.
                                  • 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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