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5 Tips for Responding to ICT Equipment Price Increase
Global chip shortage is an incontestable fact nowadays. It makes ICT (Information Communication Technology) products price increase. Some ICT manufacturers' products price has raised again, including Cisco, Aruba, etc.
How to respond to ICT equipment price increases? An ICT supplier with 20-year experience, Router-switch.com provides 5 tips.
Global chip shortage is an incontestable fact nowadays.
The global chip shortage is a reality. By one estimate, the global chip shortage affects 169 industries.
Apple has reportedly halved iPad production and reused old iPhone parts for the iPhone 13[1].
Nintendo is slashing production of its switch OLED console by 20 percent, with a spokesman saying chip shortages have affected production[2].
Gartner estimated that the semiconductor shortage will continue into 2022, and warns that wafer orders could take a year to deliver[3].
Forrester said chip shortages are continued into 2022 and 2023[4].
ICT Manufacturers changed their price several times recently.
The ICT industry is another industry that relies heavily on chips to produce products. The global chip shortage that has lasted for several years has provided to continual changes in the prices of products in the ICT industry.
ICT Manufacturers changed their price several times recently.
As the chip shortage, many ICT manufacturers must delay their lead-time or raise their product price.
Cisco is a famous ICT manufacturer, but it also suffers from chips shortages.
"I wouldn't say we have a complete timeline for you as to when things start to improve. All we know now is we expect this to be with us through the second half of our year," Cisco CEO Chuck Robbins said. [5]
The past year and at the beginning of this year, Cisco has adjusted its prices intensively several times. About the service (such as license, software, etc.), the price changed on Jan 30th, 2022. It raised 10%-30%.
On Mar 4th, 2022, the price of some products reduced 100%, but there was still numerous products' price raised, up to 149.99%.
The price also will change on April 1st, 2022, up to 321.72%
From some suppliers' information, Aruba also will raise its price in April, about 20%. The HPE and Dell also will delay their lead-time because of the material shortage.
There are counterfeit products in the market
The ICT manufacturers' products price increase has skyrocketed procurement costs for system integrators and end-users. To make matters worse, there are counterfeit products in the market, which increases procurement risks.
The COVID-19 pandemic hit the world from both supply and demand sides. Steve Calabria, the founder of the Independent Distributors of Electronics Association (IDEA), believes this double squeeze will result in a surge in counterfeit electronics, affecting the longevity and reliability of devices made with substandard components.
Calabria Said, "worldwide shortages have led the way for criminals to exploit the electronic component marketplace," adding that he's already seeing early signs of trouble. "Companies that have never been rated by any other company in the industry [are] showing significant quantity of parts that are in shortage."[7]
How to respond to ICT equipment price increase?
How to deal with the ICT devices price increase? An ICT supplier with 20-year experience, Router-switch.com suggests taking measures like these:
Assess your need
Do an in-depth and complete assessment of whether you or your company really need a lot of equipment or licenses. Equipment manufacturers will bundle their equipment and licenses for sale, leading some customers to purchase more equipment and licenses than they need. When the assessment is complete and the actual needs are determined, you can then consider what equipment and licenses you need.
Putting pressure on your suppliers
Ask your ICT equipment supplier to deliver the best price. If not, change supplier! There are numerous excellent suppliers like Router-switch.com in the market! Excellent price and short lead time are the two principal things. When you have to change your ICT devices supplier or other top-branded products, please be vigilant. Some suppliers may not provide brand-new sealed products. You'd better make some survey.
First, see the website of the supplier, is it believable? Second, check the reviews of actual consumers of this supplier. Third, ask their customer service for detailed information about their company. Fourth, place a small order to verify if it brand-new seals. Last, if there are no suspicious things, you can choose this new supplier.
Putting pressure on your suppliers
Choose other manufacturers
Good ICT manufacturers are not only Cisco but also HPE, Huawei, Dell, etc. If the price of all these big manufacturers is high, you can also choose medium-to-small manufacturers, such as Aruba, Ubiquiti, etc. There are many lists of top manufacturers, just search at Google!
There is likewise a tip here. You should not put all your eggs into one basket. For example, you can select Cisco routers and switches, to deploy your company network, when choosing HPE servers to deploy your data center.
Purchased certified refurbished products
Although refurbished products get some bad reputation, purchasing certified refurbished products is used as the method. Some manufacturers will certify refurbished, such as Cisco, HPE, etc. The price of refurbished products is not very high. If using refurbished products will not bring a big risk to your company or project, why not?
Purchased certified refurbished products
Turn to "Cloud", like SD-WAN
What is SD-WAN? Software-Defined Wide Area Network is a service formed by applying SDN technology to wide area network scenarios. This service is utilized to connect enterprise networks, data centers, Internet applications, and cloud services. SD-WAN is a rapidly deployable, low-cost and highly flexible WAN solution. The SD-WAN becomes more popular than before. It saves much cost than actual hardware but provides useful applications.
Turn to “Cloud”, like SD-WAN
Brand Model Brand Model
Cisco C9300-24S-E Cisco NIM-2T
Cisco C9300-48P-E Cisco PWR-C5-1KWAC=
Cisco C9300-24T-E Cisco PWR-C5-600WAC=
Cisco C9300-48T-A Cisco C9200L-STACK-KIT=
Cisco C9200L-24P-4X-E Cisco C9200-STACK-KIT=
Cisco C9200L-24P-4G-E Huawei S5735-S32ST4X
Cisco C9500-24Y4C-A Huawei S5731S-H24T4S-A
Cisco C1000-24P-4G-L Huawei S5720-36C-EI-28S-AC
Cisco C1000-8T-2G-L Huawei S5735S-L24P4X-A
Cisco C1000-48P-4X-L Huawei S5731-S48P4X
Cisco C1000-24T-4G-L Huawei S5735-L24T4S-A
Cisco C1000-16P-2G-L Huawei S5720-28X-SI-24S-AC
Cisco C1000-16T-2G-L Huawei S5735-L12T4S-A
Cisco C1000-24T-4X-L Huawei S5735S-L32ST4X-A
Cisco C1000-48T-4G-L Huawei S5720-12TP-LI-AC
Cisco C1111-8P Huawei S5720-12TP-PWR-LI-AC
Cisco FPR2110-NGFW-K9 Huawei S1720-52GWR-4P
Cisco CP-8811-K9 Huawei AirEngine 6760-X1
Cisco CP-7821-K9 Huawei Huawei AirEngine 5760-10
Cisco GLC-LH-SMD Huawei OSX010000
Cisco GLC-SX-MMD Huawei SFP-GE-LX-SM1310
Cisco GLC-TE Huawei OMXD30000
Cisco SFP-10G-LR Huawei SFP-1000BaseT
Cisco SFP-10G-SR Huawei SFP-10G-CU3M
Cisco SFP-10G-SR-S Huawei PAC1000S56-CB
Cisco C9200-NM-4G Huawei PAC60S12-AR
Stay optimistic, the darkness will pass
The epidemic has gradually been the norm, and major chip manufacturers are also building new factories for production. Remain optimistic and always believe that the global chip shortage will one day be alleviated and equipment prices will gradually fall.
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