Resellers, Distributors Report Strong Hardware Sales In 2011

Reseller and distributor sales of commercial hardware and services rose 5.5 percent last year, as companies upgraded PCs and networking equipment and added storage hardware, a market research firm said.

Overall, U.S. sales, which also included printers and supplies, rose to almost $50 billion in 2011, the NPD Group reported Wednesday. While hardware and services sales rose 13.5 percent in 2010, that number is considered a weak comparison, because sales in 2009 plummeted as a result of the recession brought on by the financial crisis.

Notebook, desktop and thin client sales were the biggest drivers, increasing 20 percent year to year in number of units and 14 percent in dollars. Thin clients are PCs with minimum storage and processing power. The systems are usually connected to a central server that runs most of the software.

Brian Lisse, owner of PC reseller Madison Computer Works, Madison, Wis., said last year's growth in the overall market was roughly the same for his company, which sells to businesses with as many as 135 employees. "We're selling like gangbusters," Lisse said.

Sales are getting a boost from companies upgrading from Windows XP to Windows 7, said Lisse, who expects commercial sales to remain robust until the third quarter of this year. "They haven't been hiring and they have money for technology," he said of businesses. In addition, the consumer market has been helped by lower prices.

Tablets had no significant impact on PC sales among the distributors and direct market resellers surveyed, including CDW, PC Connection, Tech Data, Ingram Micro and Synnex. "We have seen a very minute impact," NPD analyst Stephen Baker said.

Besides PCs, NPD found an 8 percent increase in dollars spent year over year in networking equipment, which included wireless access points and gateways and wired network products. Storage hardware sales rose almost 7 percent, led by solid state drives. Sales of SSDs were up 92 percent.