PC channel gets back to business

Despite disappointing PC sales figures still dominating the market, the channel is optimistic clearer skies lie ahead and sales will bounce back by the end of the year.

Market analyst Inform has released September figures for the indirect PC market and the results are ugly - sales dropped 16 per cent compared to the record low of August figures.

However, reports are already filtering in of heathly November sales, a trend that looks set to continue according to resellers.

"Sales have already picked up - our November figures are brilliant," said ASI's national sales and marketing manager, Graham Orford. "October was OK, but November sales have bounced back very strongly and December is also looking very good."

This year has been characterised by three or four key events that have had a major impact on the PC market. The most recent, the Olympic Games, has been responsible for the latest poor figures, according to Inform, and the channel is now looking forward to getting back to business.

"These distractions have upset the usual seasonality patterns of the market and caused sales to rollercoaster throughout the year," Inform analysts said in the company's weekly market report, Infocus.

With a new round of contractual rollouts and decent volume orders already taken for the next three months, ASI Solutions will continue running its production facilities during the Christmas shutdown period.

"September sales were slow - there is no getting away from that," Orford said.

Inform reports stock is currently "pouring into the channel" and the outlook for Christmas is bright.

Centari Systems managing director Jon Johnston said his business varied from state to state.

"In the last six months we have had record sales in South Australia," he said. "The other strong state was New South Wales, even with the Olympic Games."

Johnston concedes sales during the Olympic period were around "10 per cent lighter than we thought they would be", but the company is still on track with 20 per cent overall growth for the year.

"November has been a very good month for us and we will have a good backlog going into December."

Victoria has been the only flat market for the company, he said.

"Looking at the analyst figures, you wonder how anybody can survive? But I think a lot of the non-buying is occuring with very large companies which caught up on their hardware infrastructure in the 1999 calendar year."

Johnston believes the commercial market will remain slow during December and January and will revive in March and April.

This year, desktop prices have fallen 15 per cent on average compared to 1999. Server prices have dropped by around 16 per cent, despite ongoing chip and hard drive shortages.

PCs account for about 70 per cent of channel sales, according to the analyst. Notebooks make up 20 per cent of the market and servers account for 5 per cent. Corporate dealers and mass merchants dominate with more than 60 per cent of the indirect market.