UK supply chain subject to "unprecedented" price shifts

Number of price changes has doubled on an annual comparison, according to Probrand

There were nearly twice as many product trade price changes in the UK supply chain in August than in the same month a year ago, VAR Probrand has found.

The reseller's www.theITindex.co.uk recorded 420,000 changes to individual product trade prices in the UK supply chain last month.

This compares with just 237,000 a year earlier, and is similar to the level recorded at the start of the recession in 2007/08, Probrand said.

The increased volatility of prices is a reflection of manufacturers consistently being challenged by their costs, it added. This could be impacted by raw material and transport costs, but also exchange rates between countries in the supply chain, said the reseller.

Peter Robbins, managing director of Probrand, said: "We are viewing unprecedented price movements in the UK ICT supply chain, and trade price changes here are a direct result of testing global economic conditions that are challenging manufacturers by the minute.

"Are these price changes caused by tough times in the world economy or are the movements symptomatic of the ongoing disruption caused by the catastrophic events in Japan during March? Perhaps it is a combination of the two that is delivering such an unusual pattern in the most dynamic market place in the world."

Robbins said this volatility is hitting ICT buyers as they try to keep abreast of price movements to buy at best value.

"It is also challenging for any Public Sector supplier contracted to offer consistent cost-plus fixed margins on ICT products as prices are moving regularly in such high volumes," he added.