Africa Beckons for HCP Vendors, Posts Strongest Quarterly Growth for 2 Years

The African hardcopy peripherals (HCP) market kicked off 2014 with its strongest performance of the past two years, according to the latest insights from International Data Corporation (IDC).

According to the report obtained by Nigeria CommunicationsWeek, the research and advisory firm's recently released Quarterly Hardcopy Peripherals Tracker for Q1 2014 shows that the region saw excellent shipment growth of 17.7% year on year, while revenue growth for the quarter was a more modest 10.0% as vendors slashed their prices in an attempt to remain competitive against unofficial imports.

While South Africa, the continent's biggest market, remains firmly in the grips of an unrelenting recession, other markets in the region are reporting impressive growth.

Strong tender activities within the government sector and growth in the small and medium-sized business (SMB) segment were the main drivers for this growth across the continent.

"Africa is proving to be one of the fastest growing regions in the world for hardcopy peripherals," said Ashwin Venkatchari, senior program manager for imaging, printing, and document solutions at IDC Middle East, Africa, and Turkey. "Increased investments in the development of IT infrastructure in most parts of the continent are driving demand for hardcopy peripherals. Much of the region has traditionally been serviced through unofficial imports; however, some vendors have already started to invest in local channel development. And these investments are now beginning to show rich dividends."

Inkjet shipments to Africa increased 26.1% year on year in Q1 2014 to total 281,000 units, while revenues grew at similar rate of 25.2%.

Inkjet devices priced below $100 were the main driver behind this growth. In addition, it is interesting to note that devices priced above $400 reported the most aggressive growth, disproving the theory that only cheap devices sell well in Africa.

This segment's growth also had a major impact on overall revenue growth.

Mono laser shipments were up 11.3% over the same period to total 227,000 units, although revenues fell 1.3% as vendors implemented price cuts across all speed segments in an attempt to remain competitive in the marketplace. Color laser shipments were up 18.2% year on year in Q1 2014 to total 42,800 units, while revenues grew at a faster rate of 28.7% as vendors increased their prices to offset the losses incurred in the mono laser space.

Going forward, however, IDC expects to see an erosion of prices in this segment as vendors strive to increase acceptance levels for color printers across Africa.