Laptops are some of the most common and essential tools in the modern age, and this has become even truer at the onset of the COVID-19 pandemic.
If you were one of the people who got yours during the pandemic, you must have noticed that laptop prices have spiked. Why is that? I looked into it, and here is what I found!
Why Are Laptops So Expensive?
Laptops are expensive because they’re made with high-quality materials and are manufactured using specialty machines and technicians. Laptops are sold under different brands and with a wide variety of features. Technically, newer generation laptops are pricier because they’re more powerful and efficient. Additionally, laptops are in high demand today due to the pandemic.
If you are interested in learning more about the factors in laptop manufacturing, branding, marketing, and supply chain markups that make laptops expensive, keep on reading!
1. Laptops Are Made Of High-Quality Materials
Laptops are made with a lot of materials, and the best brands use only the finest supplies in the market for their products.
Further, some of the most common laptop materials are plastic, steel, aluminum, copper, lithium-ion batteries, magnets, microchips, and trace amounts of platinum and gold.
Of course, these materials are costly, even more so when they are sourced from reputable suppliers; this alone can make laptops expensive.
2. Manufacturing Laptops Involves Machines & Technicians
Manufacturing laptops involves automated and non-automated processes. Even today, assembling and testing laptops must include manual labor for best results.
Also, apart from needing to maintain machines, laptop companies must train and pay the technicians that make every step of the manufacturing process possible.
Generally, the bigger the laptop brand and the more clients they cater to, the more machines and technicians they use.
A company’s operating cost influences their laptops’ price, which is often high.
3. Laptops Undergo Extensive Marketing
There are over two dozen laptop brands in the world, with the most popular industry players being Acer, Apple, Dell, HP, and Lenovo.
Of course, each of these laptop companies attracts clients through marketing campaigns on television, YouTube, and social media platforms.
Even for smaller laptop brands, these marketing campaigns can be quite pricey, especially if they hire a marketing specialist or agency.
Therefore, to cover the cost of their marketing campaigns, laptop companies have to increase the cost of their laptops.
4. More People Are Working & Studying From Home
COVID-19 lockdowns forced people to work and study from home, and to accommodate this shift, people began investing in gadgets like laptops.
Since 2020, laptop sales have increased across the globe. While desktop computers are good alternatives, the portable nature of laptops makes them the preferred gadget.
That said, this higher demand from companies and individuals allowed laptop companies to increase their prices.
5. Shipping & Import Fees Spiked Due To The Pandemic
Global lockdowns put shipments on hold for several weeks at a time. When restrictions were eased, ports ended up congested, and passages sometimes became impassable.
With the severe strain on shipping goods, companies have to drive up the cost of their shipment fees. Furthermore, tariffs also increased as a result of the pandemic.
Additionally, local manufacturers had to make their laptops more expensive to cope with importing and exporting parts. All of these factors make laptop prices heftier than before.
6. Laptops Come With A Variety Of Features
Laptops come in all shapes, sizes, and features. There are rugged laptops designed to be waterproof and drop-test survivors like Getac B360 and the Durabook S14I.
Also, some laptops have touchscreens and OLED screen displays, and some can be folded or detached to become a tablet.
Essentially, laptop companies understand the value that these features bring, which is why they have to charge more for them.
7. Laptop Brands Matter A Lot
Consumers judge laptops first by their brand. For example, laptops with more recognizable brands like Lenovo, Apple, Acer, and HP tend to receive better responses and higher sales.
At the end of the day, it all boils down to brand equity. Since known brands have established their reliability for a long time, people are more trusting of their products.
Generally, the more popular the brand, the more popular the laptop gets, even if their products are no better than lesser-known brands.
8. Laptop Generations Impact Their Value
Laptop generations determine the age and reliability of laptops.
For example, recent generations tend to produce less heat and have better power efficiency, among other features.
Additionally, next-gen laptops are getting thinner and lighter to cater to the need for more accessible transportation, especially for workers.
Also, newer generations have an intel core that can cater to heavier duty work, making them more in-demand and more expensive to produce.
As a result, next-gen laptops fetch a higher price.
9. Each Member Of The Supply Chain Marks Up The Laptops
Laptops are part of a complex supply chain. Before a laptop becomes available to buyers, the laptop gets a markup in every part of that chain.
It starts with suppliers, the laptop makers, the distributors, and then the retailers. As you can imagine, even the smallest markups can significantly increase the laptop’s final price.
As such, you will notice that laptops purchased directly from the assembly plant or the manufacturer’s local vendors are cheaper.
However, most people prefer the more convenient route and go to retail stores. By then, you will find that laptops have become way more expensive.
10. Laptops Come With Plenty Of Accessories
Laptops are sold with a host of accessories that are designed to make your experience so much smoother and more efficient.
For example, some of the most in-demand laptop accessories sold today are sleeves and accessory bags, cooling pads, webcams, laptop stands, flash drives, and card readers.
Also, some laptops are sold with these items as a package deal, and this can make laptops more expensive.
11. There Is A Global Chip Shortage
Currently, the world is suffering from a chip or a semiconductor shortage. Mainly, this is a result of the pandemic and the increasing demand for chip-powered gadgets.
Apart from laptops, other gadgets powered by chips are smartphones, tablets, and gaming consoles, all of which are sought-after products today.
So, since chips are getting more expensive and difficult to come by, laptop companies have to increase their prices accordingly.
Laptops are getting more and more expensive as of late due to the current work and study-from-home set up across the globe.
Additionally, the pandemic has caused a worldwide chip shortage; without chips, devices like laptops will not function.
Also, laptops get markups as they travel along the supply chain, meaning branded laptops get even more expensive in the process.
Considering other factors like laptop features, intel core series, and the general priciness of manufacturing laptops, it should be no surprise that laptops are costly.