• 3 Ways to protect yourself against the Brexit IT price storm

The IT industry is still undoubtedly one of the most volatile markets with price and stock fluctuating on a regular basis and up to a million price changes within a quarter.

As we head full force into the New Year, the prospect of Brexit and price increases loom over the tech sector. Here are our top three tips to help you navigate through the Brexit-induced price storm.

Negotiate & scrutinise price

Since the decision to leave the EU in June the average IT product price in the UK has increased by 12.7%. This figure is based on a basket of 1000 regular-buy B2B IT products, from a wide range of vendors, sectors and price levels.

This figure, however, does not cover the various price rises predicted for January, for example Microsoft are predicted to increase prices by 13% - 22% with on-premise enterprise software, as well as its enterprise cloud products.  They are not alone, VMware is also planning a 15% price increase in January.

This increase in product prices is way above inflation and is even higher than the 12% price increase of food vendors such as Birdseye and Walkers which hit the news.  There has been suspicion that some prices rises are higher than needed with vendors ‘hedging their bets’ in an attempt to protect themselves for the next few months. One tactic open to customers is to push for a better deal through firmer negotiation and scrutinisation of the supply chain.

Consider forward purchasing

Some vendors have already started to increase their prices, most-notably Apple. After the release of the new MacBook Pro range, prices on several of the company’s products. Laptop vendors such as Dell, HP, Asus and VeiwSonic are amongst others who have already increased prices.

Procurers now need to consider forecasting further inflationary rises into their budgets and seriously consider to moving larger volume purchases to minimise the impact of further rises. Many special bid agreements that vendors have in place with suppliers are only valid until the end of December, meaning there is some merit in persuading customers to complete their orders this month.
 

Protect public sectors with frameworks

The Technology Product 2 framework is going to be the shelter against the Brexit storm for public sector.

Technology Products 2 went live on 31st October with several changes being made to improve the process for suppliers and buyers. As we edge closer to the Brexit, there are ongoing discussions about the exchange rate with all the major vendors in the hope of keeping public sector customers sheltered from increasing prices.

As everything is traded in dollars it’s impossible to predict the full impact that Brexit will have, all we know is that IT prices will increase. However, with 61 suppliers the Technology Products 2 framework will be in a good position to negotiate prices, so public sector customer using Tech Product 2 have the best chance of being protected by the price rise storm.

 

The Probrand Marketplace offers framework pricing personalised to your sector upon login, register today!
 

Who’s rising prices when?

Manufacture

Price Increase

Affected Products

Start date

HP

20-25%

All products

Just after Brexit they have gradually been going up over 2-3 price increases

Dell

20-25%

All products

Just after Brexit they have gradually been going up over 2-3 price increases

Lenovo

20-25%

All products

Just after Brexit they have gradually been going up over 2-3 price increases

Asus

9%

All products

Beginning of Q4

Jabra

10%

All products

Beginning of Q4