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The commodity IT market remains a challenging one, with a constant conveyor belt of products entering the market at any one time. Keeping tabs on the plethora of new devices, technology and form-factors is a challenge for any procurement team with huge variety occurring between different products and brands. Buyers need to understand everything from the impact of future market trends, to looking at what will be business critical tomorrow.  But staying on top of tech developments and achieving value is particularly difficult in a volatile three tiered global supply chain – manufacturer, distributor, reseller. 

When purchasing IT products, understanding the supply chain behind each product and components that make up that finished product is key, particularly when considering manufacturers will often plan their product portfolio up to a year before they hit the shelves.  With the right insight, it is possible to predict future product and purchasing trends and more importantly how to leverage this knowledge to achieve value.

Consider the different elements that a vendor will have to look at, ahead of product development alone.  Market research is pivotal and will often be undertaken on a global scale to weigh up the varying demands of different geographical landscapes and business cultures. Added to this is the speed at which the IT landscape moves, with manufacturers often having to plan a minimum of 12 months ahead to get products from the assembly line to point of sale at the right price.

Advances in technology also play a large role, with developments from technology giants such as Microsoft and Intel often influencing the market when it comes to driving innovation. Finally, vendors will also have to liaise with other component suppliers, often across differing geographies and currencies, before they can get started, all of which takes time and impacts cost.

Consider that there is also a three-tiered global supply chain and, once built, products can still take several weeks to be shipped to Europe and the UK, if transported by boat. With insights into what brands are planning, buyers can gain an accurate view of what equipment is going to be available months in advance – and how much stock will be available and for how long.  Understanding this means understanding supply and demand conditions on price and a good reseller partner should be able to provide support to that end.

Some suppliers, for example, will build one batch at a low price to shake up the market and make some noise. This will often result in a quick shift of stock that, once gone, is gone. So, knowledge around the availability of certain products and their lifecycle, enables buyers to be more confident in knowing when to make a timely purchase versus when they can afford to hold back.

What is required is a better understanding of the product. How long has the product been in the market, is the stock level slowly decreasing along with the price, are there any historical pricing trends that could predict a further price drop?

To attain that level of data, many buyers turn to search engines for perceived impartial information.  However, the disadvantage of search engines is the time it takes to get the information buyers think they need, only to find the data pulled back is from a single point in time, and that makes it out of date after one day at best.  The rapid dynamics of the supply chain radically change price and stock by the minute.  But progressive methods of bringing together and helping buyers extract value from this often multi-format data do exist.

With better understanding of the workings of the global IT supply chain and technology product lifecycles, buyers can make more strategic decisions on time to purchase and IT resellers should be able to help here.

Couple that with a handle on the mass of price and stock data available for comparison activity, buyers should be able to make far more informed choices based on value to ultimately stretch the reach of existing IT budgets.