As indicated by the typical company data, the demand, from both re-sellers and retailers, for wholesale of electronic products has been growing both since 2017 as a result of increased demand for data process and computing of business customers of their customers and consumers’ confidence.  

Sector’s Current, Trend, Causes behind trend, and Future

Current and Trend

1. Generally, the demand for technology products has been increasing since 2017 driven by increasing demand from for-profit companies and individual consumers.

2. It seems that the demand for technology products and service, from for profit companies customers of marketers and resellers, has been strong and growing fast in the past two years.

3. It seems that the demand for technology solutions and products, from public sector customers of marketer and resellers, has been seen declining in US market.

4. It seems that the in-store demand, from individual customers of retailers, for consumer electronic and computing products including service and content has been rebounding in the past two years.

5. It seems that the online demand, from individual customers of retailers, for consumer electronic and computing products including service and content has been continuingly strong and growing fast in the past three years.

6. The strong drivers in this industry have been value-added products and service/solutions.

7. We have seen stronger growth from Europe market.

Causes behind the trend

1. Generally, the growth in this industry in the past two years has been driven by recovery of macro-economy including the increasing profitability of their business customers and confidence of consumers.

2. Generally, we think that the declining in-store sales of some major retailers, which have been diluted by other alternative retail channels as a result of changes in shopping habit of consumers, has been offset by strong recovery of macro-economy and fast increasing confidence in consumers.

Industry Future

1. Companies may find that demand will continue to be driven by increasing demand from marketers, resellers and retailers of technology and more small online sellers.

General Financial Performance of Companies In the Sector

It seems that the demand for wholesale of technology products and content from marketers, retailers, and re-seller customers of companies in this sector has been growing in the past two years thanks to continuingly strong demand, from for-profit business and personal consumers, for data process and computing &entertainment during the same period of time.

The typical gross margin is about 6%, and with a SG&A as percentage of sales of 4% the operating margin is about 1% in 2018. The typical enterprise price/EBI ratio is 15.

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