Electronic items are the latest goods to possibly surge in price this holiday shopping season, as a result of global supply chain issues that have forced large electronic brands and companies to spend a lot of money to ensure stores are well stocked with their gadgets. As a result, consumers may only have expensive gadget options this holiday season.
Electronic brands are also having to deal with a global chip shortage that has left their production of goods slower than normal. Factory closures have also left production halted in many areas, as a result of the COVID-19 pandemic, and many factories located in Asia have been momentarily shut down from time to time because of infection outbreaks. All of these issues have hindered the production of electronic goods, though these issues may finally fully be seen during the holiday shopping season, a time when many people buy new electronic gadgets and gifts.
While all of these issues play a factor in the price of electronic goods, the global supply chain issues are possibly the major reason why the price of these electronic goods is going up for the holidays. For months now, analysts have warned both consumers and businesses that shelves may not be stocked — both in-store and online — with the high amount of products normally seen. Therefore, many consumers have started buying products for the holiday season now to ensure they can get the items they want before they sell out.
Many big corporations, such as Walmart, have taken steps to ensure that their stores are fully stocked with items this holiday season by spending more money on their own shipping carriers and planes. Big electronic companies have also done this, spending more money to ensure that there are enough electronic products for consumers to choose from at the end of the year. However, because it cost more money to do this, the price of the product will also go up.
Many businesses are also pushing higher-end electronic products, versus cheaper options, on their websites and in-stores, mainly because there is more quantity of expensive products. For example, websites show that cheaper products have much longer wait times, when compared to the more expensive products, for delivery. An $800 iPad Pro can be to a customer’s door almost immediately, whereas the cheaper $330 iPad would take a month or more to finally reach the customer.
Retailers and stores are pushing more expensive products on consumers, mainly because vendors are choosing the more expensive products to manufacture, rather than the cheaper options, because of the chip shortage. With limited chips, only the expensive options are being chosen to be produced, mainly because vendors can better get a profit from these items, versus the cheaper items.
This will also play a factor this holiday season, as consumers may only have expensive electronic items to choose from, and a limited stock of more affordable electronic gadgets to buy. Once the chip shortage evens out and is no longer a problem, then vendors can likely put more money into producing these cheaper, more affordable options.