The pandemic has caused tremendous delays in the shipment of goods. This is evident from a 2020 Statista survey, where it compared supply chain delays between February and March 2020 – right at the start of the pandemic. Fewer deliveries could meet timelines below six weeks, and deliveries of eight weeks or more went from 0% to 2%.

It turns out these were the early signs of a more significant delay in delivering goods. By April, the Wall Street Journal reported growing delays as demand surged for products such as laptops, and vendors started noting that other areas such as networking and storage were also shifting to the right. And the overall trend is not over – just this month, the BBC warned there are likely to be Christmas shipping delays due to backlogs and ongoing virus outbreaks.

Then there is the chip shortage, a phenomenon that impacts just about every electronic product. Production of even seemingly commonplace items such as PC monitors is not meeting demand. This is a challenge for a technology industry used to short delivery times.

"I think everyone in the industry is so used to quoting a three- to four-week lead time that it's become the standard expectation," says Gerry Vletter, Dell EMC Business Unit Manager at Axiz. "But that's not the case and it's not going to change overnight. Both the channel and customers need to look at their technology plans. Proper planning needs to go into this because you can't just assume that you'll receive your equipment within three to four weeks."

The dangers of over-demand

Have no doubt – local demand for technology products is staggering, says Leriza De Bruyn, Axiz's Dell Commercial Product Manager. "There is such demand out there that as soon as that stock comes in, it goes out again. Customers need to be aware of that. They need to have a little bit more flexibility in their deployment plans."

Specifically, she urges companies to talk to their technology providers about deadlines and alternatives. Perhaps the delay is tolerable. But don't assume it will level out soon. It may require sweating assets for longer, looking at software alternatives such as cloud services, or making strategic back-orders so as to be further along the delivery queue.

De Bruyn also urges those in the channel to be open with customers about the situation. "Communicate with them. Give them information of what is coming in and what options are available to quote. Talk to product managers to find out exactly what is coming in, so that they can offer customers the right options. It's crucial to set the expectation, not just to tell the customer what's the easiest way out."

Channel companies are also at risk if they don't look at the situation soberly. Many are under the impression that there is tremendous demand in the market, yet the demand is not so much about growth as the unavailability of stock. Customers are instead trying to procure items elsewhere, not realising that the shortage is evident across nearly all vendors. This means that the channel might be setting itself up for an oversupply scenario, which will lead to adverse effects.

"My concern is that we are over-estimating the demand at the moment," says Vletter. "But once the bubble bursts and stock starts shipping from all the vendors, there's going to be an oversupply of equipment in South Africa for a while."

This might seem like good news for customers as prices drop. But the channel has long evolved beyond box-dropping. Fire sales on tech equipment could lead to two problems. It could destabilise partner models, impacting service delivery that enjoys some subsidy from hardware sales. It could also leave SA with a glut of outdated technology.

"Technology in South Africa could lag behind due to oversupply in two or three years from now. That can affect warranties and the availability of specific components, which would not be available anymore because the world has moved on. I've never seen anything like this in 20 years and I think we shouldn't take it lightly."

A technology drought or compromised partner models might not happen, though it's very plausible. The greater concern is more near-term: if the market keeps acting as if the shortage is not as acute or long-term as it appears to be, it will not adjust accordingly.

"It's good for the customers to know in what situation we are at the moment, especially with the stock that's taking so long to deliver and the reasons why it's taking so long. Talk to your technology provider about delays and mitigation strategies. We might start talking about the end of the pandemic, but it will take longer to get stock levels back to what we are used to," says De Bruyn.