Gauteng Business News

Send  Share  RSS  Twitter  15 Apr 2013

INFOTECH: Notebook Sales Struggle As the Economy Splutters


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Notebook sales didn’t have a good first quarter - as many pundits predicted - with sales expected to hit 35.2 million in the first quarter of 2013, representing a 15% decrease from the 41.4 million notched up in the fourth quarter of 2012, according to research company IHS.

Christopher Riley, MD of Pretoria-based notebook and accessories retailer, The Notebook Company, said sales of notebooks at his company were 14% down on the fourth quarter of 2012. “But we expected a slow first quarter,” he said.

“There is often a bit of a dip in the first quarter when compared to the fourth quarter of the previous year. But this is quite a big drop. One of the reasons – certainly from a local perspective – is that South African consumers are struggling with a high level of indebtedness. After spending over the festive season, many will be holding back on the spending – at least temporarily. Additionally, even companies are watching expenses right now – even if they do have cash in hand. Everyone is a bit jittery about the economy and don’t want to part with too much cash. But I do see this situation easing up as the year progresses and we are anticipating a much improved Q2 and Q3 –and are expecting sales to at least match Q2 and Q3 sales recorded last year.”

“Notebook ODMs in early 2013 are feeling the pain from the combined impacts of uncertain economic conditions and slower-than-expected sales of Ultrabook PCs,” Peter Lin, senior analyst at IHS said in a statement.

Speaking to the press recently, Lin said that part of this slowdown in sales could be attributed to the rising popularity of mobile devices.

“More importantly, smart phones and tablets have been outselling notebook computers, and demand for ultra books and other ultrathin PCs so far has not taken off as expected,” said Lin.

But Lin believes there will be an increased demand for Ultra books and other ultra-thins, which should put some bounce back into the portable PC market during the second half of 2013.

Commenting further, The Notebook Company’s Riley said: “We are expecting an increase in demand for Ultra books, but I also believe that – at least as far as The Notebook Company is concerned – that notebook sales will stabilise during the year. Ultimately, from a calendar year perspective, however, I think sales will be down on last year. But we are hoping for a single digit drop,” he said.

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