pearson-kelly technology blog

Hardware Shortage Wreaking Havoc in 2021

BUYER BEWARE: there's a hardware shortage causing drastic price increases. Find out how to manage the shortage and get your tech faster.

Thinking of refreshing your devices or purchasing new hardware this year? You might want to think again. As another gift from 2020, many businesses are struggling against a hardware shortage, backorders, and exorbitant hardware costs.

Causes of the Hardware Shortage

1. Covid-19

Most manufacturers weren’t included as Essential Businesses in the original lockdown restrictions, so they had to shutter their doors. Even when they reopened and started production again, they had to keep their staff volumes low to protect their employees from spreading the virus. All of which led to lower-than-normal outputs.

That was all fine and good originally. The demand for most manufactured products was low because everyone was in lockdown. But when restrictions eased, businesses reopened, and people became more confident of their financial future, demand for those products rose rapidly.

Now, businesses are stuck managing a hardware shortage that’s driving the cost of goods higher and higher and leaving many businesses stuck with backorders that may not get filled for three or more months.

2. Semiconductor Shortage

As much as we’d love to pin this hardware shortage on the virus, there’s also a widespread semiconductor shortage causing problems. Semiconductors are in every computational device; they’re foundational to anything electronic. And they’re few and far between.

Because so few plants manufacture these semiconductors, they simply can’t build enough to meet the new demand. You’d think that other manufacturers could spin up and assist with the production, but these facilities have such high restrictions that it’s hard to create new means of production.

So now we’re all stuck between a rock and a hard place. Most businesses are expanding their technical infrastructure as they embrace remote workforces, but finding the tech at a reasonable price is nearly impossible.

What You Can Do About the Hardware Shortage

Unfortunately, there’s nothing to be done about producing more hardware. You’re at the mercy of the manufacturers for that. And to be fair, they’re working as fast as they can right now to increase production and meet the growing demand. So what can you do?

Make Friends with Your Vendor Reps.

Leverage your relationships with vendor reps. If you’ve got a good one, ask what they can do to get you your hardware as soon as possible. Vendor reps can sometimes push your order to the top of the distribution list. While you’ll still have to pay inflated prices, you’ll at least have your hardware sooner than most others.

Have a Contingency Plan

Even if you’ve talked with your vendor rep about pushing you up the list, it could still be months before you get hardware. Create a contingency plan by looking at what’s in your pipeline for this year. What’s critical? What can you push off to 2022? If you can wait, do it. Prices will be lower, and production should have leveled out by then—an all-around win for those lower-priority hardware projects.

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