There are several factors that affect the price of an IT product – and a savvy buyer needs to be aware of all these variables if they are going to extract the best possible deals.
New technology product launches have a particularly big impact. Whenever new technology lands on the market, offering end users new features and functionality, it comes at a premium price. There are a few things to remember when this happens. You can discover more about the dynamics of a complex IT supply chain here.
Firstly, people will always be attracted to latest, shiniest devices and this will move demand away from older models – effectively devaluing products already in the market. Vendors selling these older products will then be forced to cut prices or face being left with stacks of inventory that nobody wants. Read about product lifecyle management here.
For example, the release of Windows 10 has devalued machines using Windows 8.1 – they are looked upon as if they are second hand but they are not. They are brand new machines that will cost you a lot less. So ask yourself, do you really need the latest model or would an older product serve your purpose just as well?
Top tip - Buy with usage in mind
A second thing to remember is that in a few months’ time another new product will come along. So it’s well worth considering whether all the latest bells and whistles are an immediate essential. If you are not sure whether new functionality is actually necessary, it might be better to wait six to 12 months, when they will cost less.
The emergence of convertible 2-in-1 devices over the last year has complicated the situation slightly as they can replace two devices, your laptop and your tablet. There are savings to be made there straight away, but even here further savings are possible.
A top-of-the-range Surface Book is likely to cost you close to £2,500, but do you really need the most powerful mode? If you have a desktop in your office which you can access remotely (with a tool like LogMeIn) all that power could be unnecessary. And by choosing a less powerful model you could save yourself hundreds.
Read full report into volatility of the IT maret and how this costs you time and money here.
Top tip - Buy at the right time
Of course new technology is not the only factor impacting prices. Over the last year the strong performance of the dollar in the foreign exchange markets has been significant. Every component going in to a computer device will have been affected by these currency fluctuations – reducing the margins vendors can achieve in European markets. As a consequence vendors have increased their prices.
It is important for buyers to know, however, that currency fluctuations do not necessary mean prices will increase straight away. For instance, if the vendor is at year end and there is still a sales target to hit, they may resist an immediate rise – even if means taking a 4% hit for that month. But if that happens, expect an 8% increase in the following month to compensate.
If you know the vendor and the seasonal trends affecting prices, you will know in advance whether prices are likely to go up or down on the back of currency fluctuations. Armed with this knowledge, a savvy buyer will be able to judge the best times to buy.