Your SlideShare is downloading. ×
Computer Hardware Industry Analysis
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

Computer Hardware Industry Analysis

726
views

Published on

Industrial Economics presentation on Computer Hardware Industry in India.

Industrial Economics presentation on Computer Hardware Industry in India.

Published in: Technology

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
726
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
116
Comments
0
Likes
0
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide

Transcript

  • 1. COMPUTER HARDWARE INDUSTRY SEC: DEF, TOPIC NO. 7 PUNYASHLOK DWIBEDY (2012223) RAHUL MISHRA (2012229) R SUSHANT SINGH (2012233) RAKESH DUTTA (2012234) RASHMI RANI (2012236) S. PREET KARAN BHATIA (2012250) SHIVAM KUMAR (2012296) RAKESH DUTTA © 2014
  • 2. COMPUTER HARDWARE INDUSTRY IN INDIA • 32,500 Cr market – Accounting 32% of IT industry in India • Some of the industry metrics • PC unit sold • $/storage • Avg. PC revenue • Price to free cash flow • Sales/Employee Computer H/W Industry Personal Computers Network Equip, Computer Peripherals Storage Devices 32.50% 13.70% 11.80% 10.40% 2.80% 28.80% Market Share HP Lenovo Dell Acer HCL Others Data source: Gartner, 2013 RAKESH DUTTA © 2014
  • 3. 5.05 6.34 7.34 6.80 8.03 9.31 10.82 11.31 2006-07, 26% 2007-08, 16% 2008-09, -7% 2009-10, 18% 2010-11, 16% 2011-12, 16% 2012-13, 5% -10% -5% 0% 5% 10% 15% 20% 25% 30% - 2 4 6 8 10 12 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Growthin% InMillionUnits PC Sales in Volume Data source: IMRB & MAIT RAKESH DUTTA © 2014
  • 4. PRICE TRENDS 0 20 40 60 80 100 120 140 160 180 200 4/1/2004 6/1/2004 8/1/2004 10/1/2004 12/1/2004 2/1/2005 4/1/2005 6/1/2005 8/1/2005 10/1/2005 12/1/2005 2/1/2006 4/1/2006 6/1/2006 8/1/2006 10/1/2006 12/1/2006 2/1/2007 4/1/2007 6/1/2007 8/1/2007 10/1/2007 12/1/2007 2/1/2008 4/1/2008 6/1/2008 8/1/2008 10/1/2008 12/1/2008 2/1/2009 4/1/2009 6/1/2009 8/1/2009 10/1/2009 12/1/2009 2/1/2010 4/1/2010 6/1/2010 8/1/2010 10/1/2010 12/1/2010 2/1/2011 4/1/2011 6/1/2011 8/1/2011 10/1/2011 12/1/2011 2/1/2012 4/1/2012 6/1/2012 8/1/2012 10/1/2012 12/1/2012 2/1/2013 4/1/2013 6/1/2013 8/1/2013 10/1/2013 12/1/2013 WPI vs. Computer & Peripherals Price Index Wholesale Prices Computers Computer Peripherals INFINF Index INWICMPU Index INWICOPE Index Data source: Bloomberg RAKESH DUTTA © 2014
  • 5. FDI INFLOW 0 500 1000 1500 2000 2500 3000 0 50000 100000 150000 200000 250000 300000 350000 3/1/2004 5/1/2004 7/1/2004 9/1/2004 11/1/2004 1/1/2005 3/1/2005 5/1/2005 7/1/2005 9/1/2005 11/1/2005 1/1/2006 3/1/2006 5/1/2006 7/1/2006 9/1/2006 11/1/2006 1/1/2007 3/1/2007 5/1/2007 7/1/2007 9/1/2007 11/1/2007 1/1/2008 3/1/2008 5/1/2008 7/1/2008 9/1/2008 11/1/2008 1/1/2009 3/1/2009 5/1/2009 7/1/2009 9/1/2009 11/1/2009 1/1/2010 3/1/2010 5/1/2010 7/1/2010 9/1/2010 11/1/2010 1/1/2011 3/1/2011 5/1/2011 7/1/2011 9/1/2011 11/1/2011 1/1/2012 3/1/2012 5/1/2012 7/1/2012 9/1/2012 11/1/2012 1/1/2013 3/1/2013 5/1/2013 7/1/2013 9/1/2013 FDI Inflow FDI Inflow in India FDI inflows in Computer & IT industries INFDCUMU IFDSCOMP Data source: Bloomberg RAKESH DUTTA © 2014
  • 6. POTENTIAL GROWTH RAKESH DUTTA © 2014
  • 7. PORTER’S 5 FORCES Moderate because of • High price Sensitivity • Low Player Differentiation Bargaining power of buyers Strong due to • Limited number of suppliers • Suppliers are large, international companies Bargaining power of suppliers Reasonably easy for new entrant to get moderate success because • Online shopping has grown in popularity over the years. • Reduced fixed costs for all shoppers. Threat of new entrant Reasonably low but • Replaceable technology for gaming consoles • Tablet technology Threat of substitutes Moderate • Consumers have numerous options to choose from and switching costs for them are low. • storage costs are high so quick product turnaround is vital Rivalry RAKESH DUTTA © 2014
  • 8. SWOT Strengths • Many companies have strong portfolio offerings. • Research and development - Patent • Ex: HP Weakness • Alternatives to PC’s • Computer Manufacturing Industry is a worldwide market and subjected to instability of economies in various countries. Opportunities • Opportunities for growth and advancement as developing countries increase their need for technology. Threats • Likely decline for PCs • intense competition between the large companies within the industry which make it difficult for new, smaller companies to become effective. • Governments all around the world pose threats to this industry because of environmental regulations and currency fluctuations. S W O T RAKESH DUTTA © 2014
  • 9. COMPUTER H/W WILL GROW AS IT WILL GROW RAKESH DUTTA © 2014
  • 10. PRICING POLICIES • Use price competition as their products have been commoditized. • Keep product at as many price points as possible • Examples are LG,LENOVO, ACER. • Price discrimination • large corporate, SMEs, personal PCs RAKESH DUTTA © 2014
  • 11. PRICING OPTIONS • Promotional and bundling pricing strategies. • For example 1. With HP DESKTOP PC worth Rs. 24,990 Get accessories bundle worth Rs. 2873 @ Rs. 999 And three years onsite warranty. 2. With HP ink cartridge worth Rs 317 Free HP Glossy Photo Paper Pack worth Rs 50 3. Printer + Scanner • EMI Option • Segment Visitors According to Their Purchasing Power • Inter-temporal policy RAKESH DUTTA © 2014
  • 12. DELL VS. HP RAKESH DUTTA © 2014
  • 13. MARKET BARRIERS (ENTRY & EXIT) • Entry • Everybody can start a home-based mail order business for computer parts • It takes little government permits • Wholesaler are open for every reseller • There is no need to keep large stock • Exit • Investment in specialist equipment • Specialized skills • High fixed costs RAKESH DUTTA © 2014
  • 14. NON-PRICE COMPETITION • Nibbler Approach • Go-to-Market Strategy • Online sales opportunity • Hardware maintenance services • Warranty • Patent Wars • Apple vs. Samsung • Embedded Software Licensing • Hardware(vertical) differentiation is not enough. • Example APPLE, SONY. RAKESH DUTTA © 2014
  • 15. COLLUSIVE BEHAVIOR OF EXISTING FIRMS THE SITUATION WHERE A DUOPOLY ACTS AS A MONOPOLIST • Methods - • Bidding Collusion • Price Fixing • Establish or adhere to price discounts. • Hold prices firm. • Adopt a standard formula for computing prices. • Maintain certain price differentials between different types, sizes, or quantities of products. • Adhere to a minimum fee or price schedule. • Fix credit terms. • Not advertise prices. • Technology Collusion: Holding back the release of existing technologies so that people upgrade in small increments • Ex: DDR II RAM, Overclocking of CPUs etc. • Deliberate control of supply to inflate prices RAKESH DUTTA © 2014
  • 16. UNIQUENESS • Existing Secondary Market. • Ebay, OLX, Quickr • High R&D expenses. • Mostly products are vertically differentiated. • PCs are now like cars - Predefined consumer preferences, price sensitive & self awareness. • Many repeat purchasers. • Vendors contend with high bankruptcy rates • Low inventory. • No inventory (JIT) – Dell (CCC: -14 days) • Rapid technological changes lead to disruptive innovation. • rapid price fluctuations RAKESH DUTTA © 2014
  • 17. THE END RAKESH DUTTA © 2014

×