Asus' price hike no surprise to the channel

Hardware vendor, Asus, has blamed an increase in its products prices on the fluctuating Australian dollar and the increase in the cost of computer parts and manufacturing operations.

Ted Chen, managing director of ASUS Australia, said changes to notebook and Eee Family pricing will be effective from 1 March 2009.

"ASUS has been monitoring and analysing the market situation closely and are now taking the necessary steps to face the situation head on to continue to progress the business in Australia," he said.

The price increase has come as no surprise to Asus reseller, PC Market.

Meng Koh, co-owner of PC Market told CRN the price hike has already begun.

"In the beginning it will affect us, especially when other shops hold old stock and sell it at a cheaper cost than us," he said.

"Some resellers will also be slow to react and keep prices at the same level.

"We will put it up as soon as we sell our old stock, because we generally stock up on Eee PC products because of its popularity."

 Koh claimed Asus wasn't the only vendor to increase costs, price increases are across the board.

"We have noticed that prices for cases, power boards, switches and even memory - of other vendors - have all gone up by as much as 40 percent.

"Asus is under pressure to put it up because of the rising cost of those products."

Koh claimed when prices go up, it affects independent retailers, especially in the first few weeks of the rise.

"People don't want to buy products because the hardware used to be available at a cheaper price," said Koh.

Hugo Ortega, principal at Tegatech said the sub-distributor wasn't too concerned because it was just the market evening itself due to the fall of the currency.

"Fujitsu, Panasonic and other hardware vendor have all put their prices up," he said.

"However our retail driven resellers will be affected.

 "Those guys will see a drop in one to two daily sales of units and it's sad."

According to Ortega the volatility of the market will deeply affect independent IT retailers, especially when a $300 computer goes up to $400.

"There will be a period when customers will get upset about the prices, but they will get over it and start shopping," claimed Ortega.

"Mobility is one of those key elements that won't cease.

"It provides independence freedom and productivity - high functionality and because of that I think it will increase in importance."

While Asus resellers re-adjust product prices, Chen said the vendor will also re-evaluate all existing channel structures and strategies.

The vendor wouldn't release any further details to CRN at the time of the press. Readers will be up dated on any changes.