Economic conditions and inflationary pressures will result in a 2% revenue decline in 2023
Port Washington, NY, December 21, 2022 – While U.S. B2B technology sales through the reseller channel are expected to end the year with strong unit and revenue gains, up 22% and 10% respectively, economic challenges in 2023 will lead to 2% revenue declines vs. 2022, according to The NPD Group. Despite expected revenue declines in 2023, the latest Future of B2B Technology forecast reveals unit sales will continue to grow year over year throughout the forecast period, ending in 2025, and revenue for the industry will return to growth in 2024 (up 6%) and remain for 2025 (up 7%).
“Overall budgets in 2023 are expected to be under pressure but IT investment is expected to remain the same or even increase as technology continues to be viewed as a critical necessity to maximize productivity,” said Mike Crosby, executive director and B2B technology industry analyst for NPD. “Spending on commercial software and cloud services have become even more critical to keep organizations from large enterprise to small business running, which is why we expect these areas to be bright spots in 2023.”
Sizable revenue gains are expected in cloud services and commercial software, much of it from IT operations and networking, but losses in sales of computers and consumables plus falling industry average sales prices (ASPs) by 6% in 2023 vs. 2022 will result in the 2% revenue decline next year. One bright spot for computers next year will be revenue growth for desktop computers in the healthcare and social assistance reseller vertical, according to the forecast.
“The decline in computer sales is representative of economic conditions and a bit of normalization following very high demand during the pandemic. We expect 2024 will see improvement in the category as the economy improves, B2B hardware investment resumes, and a broader technology refresh occurs,” noted Crosby.