Gadget gifting may get costly this holiday season as supply chain plays The Grinch

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Nov 10 (Businesshala) – Buyers could be looking at an expensive Christmas as supply chain snafus forces companies to rapidly market and distribute their latest high-margin electronic gadgets, leaving less-cheap alternatives under the tree Huh.

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Top electronic brands are using their best resources to address chip shortages, which have forced production of goods across pricing ranges due to logistical issues, a tight labor market and factories shutting down due to pandemic lockdowns in parts of Asia. has reduced.

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Various websites are showing that cheaper products have longer waiting times for delivery, while expensive items are available sooner.

“If vendors choose which device models they want to manufacture when they have limited access to chips, they usually go for the higher end, as they can better maximize their profits, ABI Research analyst Philomena Iovino said.

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Apple Inc (AAPL.O) and Microsoft Corp (MSFT.O) have raised bright red banners on their websites telling online shoppers to opt for early delivery on some of their newer, more expensive products at their leisure. get presents.

The $800, 11-inch iPad Pro can only be delivered on November 17th, but the cheaper and newer $330 entry-level iPad could take about a month or longer.

Similarly, the $1,759 Hermes Apple Watch will reach customers by early December 7, but the $400 Apple Watch will take longer.

Samsung will also ship the latest $1,900 Galaxy Z Fold a week earlier than the $1,200 S21 Ultra. Both are loaded with the latest 5G chips.

Qualcomm Inc. (QCOM.O), which makes high-end 5G-capable chips for Apple and several top Android phones, said its customers were focusing on premium and high-end devices.

“Since cheap phones are few, cheap phones will not be discounted as much as we usually see,” said Runer Björhovde, an analyst at research firm Canalys.

While global smartphone shipments declined due to component shortages in the third quarter, strong shipments of medium to high-end smartphones generated record third quarter revenues of over $100 billion, according to counterpoint,

Smartphone prices are expected to average $410 this holiday quarter, up from $376 last quarter and $395 last year. According to IDC, the average selling price of laptops for the holiday quarter is expected to jump 8% to $830.

GoPro Inc (GPRO.O), which shifted production to focus on higher-margin action cameras last quarter, said earlier this month that consumers would spend $300 on the top end of its line-up. Cameras were bought at a price of more than Rs.

IDC analyst Brian Ma said that even laptop makers, which rely on factories in Asia for most of their components, have shifted production of cheaper 11″ crowbooks to higher-end 14″ and 15″ variants. .

“It works during a supply-constrained environment because consumers have no other choice … so when supply eventually catches up to demand, manufacturers may look to lower-end products to appeal to more price-sensitive users.” You can produce more,” said the mother.

Reporting by Nivedita Balu and Tyashi Dutta in Bengaluru; Editing by Bernard Ore

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