Technology Sales to Businesses Growing, Report Shows

The NPD Group reports cost-conscious businesses began purchasing technology goods such as desktops, servers and printers in greater volume in December, representing the first and only year-over-year revenue gain in 2009.

Market research company The NPD Group's Reseller Tracking Service announced U.S. sales through commercial resellers were up seven percent in December 2009 reaching $1.6 billion, the first and only year-over-year revenue gains in 2009. Sales through this channel, which primarily serves SMBs (small and midsize businesses), had been gradually improving since September, with October marking the first month in 2009 with less than double-digit revenue declines. December's positive sales results were the first monthly revenue increase since the summer of 2008, which NPD said illustrates how closely business demand for IT mirrored the downturn in the economy.

Revenue from sales of notebook computers rose 13 percent in December 2009 in comparison with the same period in 2008, while the unit percent change came in at 42 percent and the average selling price was $920. However, the average selling price change for December 2009 versus December 2008 was down 21 percent. Revenue from sales of desktop computers rose 40 percent, while the unit percent change was 30 percent. The average selling price of a desktop to an SMB in December 2009 was reported to be $678, an eight percent rise from the same period in 2008.

Commercial reseller sales for all of 2009 plunged 12 percent year-over-year, ending the year at $16.3 billion. "Flat fourth quarter sales were not sufficient to offset the three prior quarters of mid-teen rates of decline," the report noted. "But the substantial improvement in trend bodes well for 2010 when stronger demand and weak comparisons ought to help keep spending trends positive."

Revenue from sales of monitors rose 11 percent, while revenue from sales of servers rose eight percent. The average selling price of a monitor in December 2009 was $175, while the average selling price of a server came in at $3,086, a 13 percent increase in average selling price versus December 2008. Revenue from sales of networking devices and printers both rose four percent, NPD reported, with the average price listed at $599 and $432, respectively.

Stephen Baker, vice president of industry analysis at NPD, said the favorable revenue trends in the fourth quarter culminating in positive December growth bode well for recovery in 2010. "With revenue growth coming as much from stable ASPs as from unit growth, SMBs are likely still buying on need. But, having key metrics such as units and ASP trending positively across multiple categories provides a solid underpinning for growth in 2010," he said. "December server results are a great example of how even though unit demand may be weak, strong ASPs are helping to keep almost all of the key product segments in positive territory."