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How to Avoid Overspending on Your PC Refresh
If you haven’t noticed, a major enterprise PC refresh cycle is underway and vendors like Lenovo, Dell and HP couldn’t be happier. The last several years have been a rollercoaster for the PC market, marked by significant fluctuations that are driven by a combination of factors.
Initially, the pandemic fueled a surge in PC demand as remote work and online learning became the norm. In 2021, global PC shipments reached a peak of 360 million units, representing a 15% YoY growth, according to data from IDC. However, this momentum began to wane in 2022 as the initial pandemic-driven demand subsided and economic uncertainties emerged.
In 2022, global PC shipments declined by 16.5% YoY to 301.2 million units, marking the steepest annual decline in nearly a decade, as reported by Gartner. Double-digit declines persisted in 2023.
In 2024, the market finally found better footing. Despite a modest contraction in Q3, most vendors have experienced a solid growth trajectory throughout the year. And there are no signs of a slowdown anytime soon. Gartner estimates the PC refresh cycle will hit its peak sometime in 2025.
What’s Driving the PC Refresh Cycle?
Our deal traffic mirrors this prediction, with many clients currently either in the middle of or planning a large-scale PC refresh. Reasons include:
- Aging Devices/End of Windows 10 Support: Simply put, it’s time. It’s common practice to refresh PCs every 3 to 4 years to make sure devices meet new performance, efficiency, and security requirements. The last refresh cycle was 2020-2021, which puts us on track. Case in point: The end of Windows 10 support is scheduled for October 14, 2024, at which time Microsoft will no longer provide security updates or technical support for the OS.
- Potential Tariffs: The incoming U.S. administration has proposed tariffs that could drive up PC pricing. As a result, many enterprises are prioritizing and bringing forward PC refreshes to mitigate higher costs.
- AI Requirements: AI features in enterprise software (e.g. Microsoft, SAP, etc.) are driving hardware refreshes to meet minimum performance requirements. Microsoft introduced Copilot+ PCs in May 2024, which they’ve billed as “a new category of Windows PCs designed for AI.” OEM partners include Acer, ASUS, Dell, HP, Lenovo and Samsung.
The Most Effective Way to Avoid Overspending on a PC Refresh
Large-scale PC buys may not be the most exciting line item in the company’s IT budget. As such, many purchases are made without the same rigor that’s applied to a major software or cloud purchase.
That’s a huge mistake – one vendors will count on enterprises to make in the current refresh cycle.
The majority of PC vendor quotes are overpriced. As a result, enterprise IT procurement teams regularly overspend 6 to 7 figures on large PC orders. The best and easiest way to avoid overspending is to perform IT price benchmarking on these purchases. Determining best-in-class pricing targets will give you the leverage you need to negotiate better pricing and discounts.
Here’s a real-world example of how NPI helped one client save on a large PC refresh with Lenovo:
How to Get Started with IT Price Benchmarking
Price benchmarking is a common best practice for any large-scale IT purchase, and it should be applied to hardware purchases (like PCs) as diligently as a large software renewal or cloud deal. Pricing variability is rampant for PCs. What one company pays for a similarly scoped purchase could be paying hundreds of thousands (or millions) of dollars more or less than the next customer.
If you have a PC refresh on the horizon, prioritize IT price benchmarking. PC vendors have a lot to gain in 2025 without enterprises paying 10 to 20 percent more than fair market value.
Learn more about Vantage – NPI’s enterprise-only subscription service for IT price benchmark analysis and negotiation intel. Contact us today.
