Raspberry Pi development boards, which are mini-computers, have been popular with schools, hobbyists, startups, and programmers because they are easy to use and customize.
They used to be inexpensive too, but recently they’ve become difficult to find, and prices are rising. If you want to know why Raspberry Pi is so expensive, read on for the answers!
Why Is The Raspberry Pi So Expensive?
1. Worldwide Chip Shortage
While Raspberry Pi has been marketed as a low-cost motherboard meant to be accessible to all, the company can no longer keep prices low as initially intended.
That’s because we are in the middle of a worldwide chip shortage due to supply chain issues, pandemic-related problems, and rising demand.
Therefore, all of these converge to increase prices for Raspberry Pi.
Also, the company recently announced its first-ever price increase, but customers are already paying higher prices.
2. Supply Chain Issues
The worldwide pandemic has created supply chain issues that will take a long time to resolve.
That said, there is a shortage of materials to make Raspberry Pi, interrupting the entire production process. Essentially, it will take time to bring it all back up to speed.
The limited supply means that even when a new shipment of Raspberry Pi reaches the stores, it is snapped up quickly.
Therefore, customers see out-of-stock notices when they try to buy Raspberry Pi in stores or online.
This increases the price of the available units for sale, well above the new prices set by the company.
3. Pandemic-Related Production Problems
The pandemic slowed down production due to lockdowns and quarantine requirements, reducing the workforce.
Combined with the chip shortage, this means that Raspberry Pi is being produced in smaller numbers while demand is increasing.
So, even though the pandemic is over, it will take time for production to come back up to meet the increasing demand.
4. High Demand Due To Work From Home
There has been an expansion of demand for PCs and Raspberry Pi in particular due to an increase in the number of people working from home and homeschooling.
So, when rising demand meets a shortage of products available, prices will be higher.
Also, customers report that even when they can find Raspberry Pi for sale, the prices are much higher than the officially-listed prices.
5. Panic Buying And Overstocking
When shortages of any important product begin to be noticed, people will start panic buying and hoarding supplies.
Further, this seems to be happening with Raspberry Pi. Also, some people may take advantage of the shortages to stockpile Raspberry Pi and sell it at high prices.
Additionally, some buyers will even use bots to alert them to the release of new supplies and snap them up before anybody else has a chance.
6. Unauthorized Resellers Charge High Prices
Many customers who have a hard time finding Raspberry Pi are forced to buy from third-party resellers, who can charge high prices way above the level set by the manufacturer.
Further, Raspberry Pi has long been a favorite for schools, hobbyists, startups, and programmers, and people will pay the higher prices if that’s the only way to get one.
7. Current Production Goes To Large Buyers
With the shortfall in supplies of Raspberry Pi, large orders are already earmarked for big buyers and corporations.
Therefore, this leaves even less available for individual customers and smaller buyers like schools, forcing them to look for third-party sellers who will charge high prices.
8. Cost Of Materials
In addition to all of these pandemic-related problems, the regular production costs have also increased. Overall, all materials used in building the Raspberry Pi now cost more.
Therefore, the shortage of chips has led to price increases in all computer products that use them in manufacturing.
9. Cost Of Manufacturing Is High
Regular production costs like infrastructure for making the computers, utilities, and salaries still have to be met.
Further, like all tech companies, Raspberry Pi invests substantial earnings in research and development.
Therefore, this provides customers with the latest technology, but research and development costs are added to the total price.
10. Skilled Labor Is Needed
Raspberry Pi computers are made by skilled workers who are paid high wages. Also, the company has a massive workforce in its offices and operations around the world.
Employees include designers, engineers, technicians, managers, and sales and logistics officers.
Of course, their salaries are recurring costs in manufacturing that affect the final price of Raspberry Pi.
11. Shipping Costs Are High
Raspberry Pi units are made in the UK, China, and Japan and shipped worldwide. Also, they must be shipped carefully and require special handling, increasing the total cost.
Further, shipping costs include special packing, ensuring that the boards arrive safely at their destination. The cost of shipping can sometimes be more than the board being shipped.
To learn more, you can also read our posts on why the Google Pixel is so expensive, why iPhones are so expensive, and why Apple watches are so expensive.
Raspberry Pi is becoming more expensive due to a worldwide shortage of chips.
Also, supply chain problems and lockdowns due to the pandemic have slowed down the production process.
At the same time, the demand for Raspberry Pi is increasing as more people are working from home and homeschooling their kids.
The problem is made worse because of panic buying and hoarding. However, the price increase may only be temporary and be resolved when these problems are worked out.