This is how the weak Rand is killing South African hardware

Rand price increase money

The Rand’s recent depreciation against other international currencies has resulted in much higher computer hardware prices in South Africa.

Over the last two years, the ZAR/USD exchange rate depreciated from R10.35/USD to the current R15.15/USD.

These higher South African prices have in turn resulted in local consumers not only purchasing less but also slower computers instead of high-end products.

The higher prices, especially in the laptop market, have resulted in a shift in consumer buying patterns.

John Geypen, Consumer Lead for PCs at HP, said entry-level Celeron-based notebooks made up 37% of notebooks sales in 2014. In 2015, this grew to 47%.

Towards the end of 2015, this number crept up to as high as 50%.

Conversely, in the high-end segment HP saw sales declining as more consumers bought entry-level products.

The higher price of laptops and other computing products also means that the overall South African market has shrunk.

“Sales of notebooks in December 2014 totalled just short of 60,000 units, while December 2015 unit sales totalled just slightly more than 50,000 units,” said Geypen.

While HP does not exclude product offerings because of the weak rand, the company limits the number of different options it has available.

“The market currently is not big or strong enough to support every different variation we have available within our product range,” said Geypen.

Geypen said HP does its best to compensate for the weak rand by adding value to products, like creating bundles with accessories, software, and printers.


This article was republished with permission from MyBroadband.

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