The fourth quarter 2002 was a time of mixed activity within the PC industry. It began slowly, with a decrease in shipments, hard drive allocation problems and reduced consumer spending. The first anniversary of 9/11 had just passed, and the threat of U.S.-led military action overseas was imanent. October

and November passed, and it appeared that the quarter would finish with negative growth. But in December shipments picked up. Vendors and analysts were hopeful that the holiday sales season would help the slumping PC market. And it did. So much so, that Q4 shipments of personal computers finished up over both Q4-2001 and Q3-2002, with an estimated 989,389 units. This figure represents an increase of 11 per cent over third quarter, and two per cent over Q4-2001.

The fourth quarter is traditionally a positive one for retail shipments. However, Q4-2002 was an anomaly as it was also a successful time for commercial activity. Corporate PC (comprised of both desktops and notebooks) activity finished the quarter with 524,298 units shipped, up five per cent both sequentially and annually. Revenues were up three per cent over Q3-2002 and 30 per cent over Q4-2001.

Overall, the PC market for 2002 finished down with an estimated 3,706,011 units shipped. This represents a decline over 2001 by approximately two per cent. It was a difficult year, as the Canadian industry continued to struggle with the decreasing demand, combined with tight pricing. Margins are not expected to increase in the upcoming quarters.

This year an increase in commercial PC activity over 2002 is forecast. Many users and purchasers of PC equipment, specifically organizations that replaced units during the Y2K rush or who have upgraded desktop components in an attempt to extend equipment life cycles, will use 2003 as a time to upgrade the systems. While ERC does not expect to see a mad surge of activity throughout the year, a modest four per cent growth in unit activity is forecast. Segments such as the education and financial sectors are also expected to pick up IT spending.

Vendors and distributors will continue to streamline business operations. In particular, go-to-market strategies will be affected. As margins tighten, the industry will present challenges for the reseller community. Presenting one face to the client will be vital for accountability and implementation strategies. The one, aligned presence will be a vital component to business practises. Developing partnerships will therefore continue to be a strategic move, particularly if they are vendor-driven. Today’s tech-savvy purchasers understand what equipment they need. Working with a vendor to find a reseller to provide the specific solution will streamline vendor activity, while providing an opportunity for the reseller to highlight key strengths in key verticals. The partnership between the vendor and the reseller will be integral to the success of the industry.

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