Price cuts on smartphones have hurt some distributors as potential buyers have canceled purchase plans for fear that prices will drop even further.
HTC One Max, a high-end model, has seen a price drop several times so far this year. Hitting the market with an initial price of VND15.59 million, it has been listed with a selling price below VND10 million. In May alone, the model’s price dropped by VND3 million.
Sony Xperia Z Ultra, the model which is believed to have all the advanced technologies of Sony, lost VND2 million in its value in May alone. Meanwhile, iPhone 5 32GB’s price decreased by VND1.5 million to VND13.99 million and HTC One Mini fell by VND1.1 million to VND8.59 million in May. The continuous price falls just within a short period have made buyers retreat. They are hesitating to buy smartphones at this moment because they fear the smartphones would depreciate. Thang, an office worker in Hanoi, said after some thoughts, he has decided to buy an Asus Memo Pad 8 at VND4 million instead of an iPad or Galaxy Note 10.1 as he initially planned to buy. “I need a mobile device good enough for me to surf on internet, read news and communicate,” he explained. “iPad is a high-end product, but it would devalue rapidly”.
The majority of Vietnamese will think carefully when buying smartphones valued at 10 million and more. Expensive products are seen as valuable assets for Vietnamese. Therefore, they don’t want to see their asset value fall after a short time.
Blackberry and Sony users are the ones who understand the problem best. Dung, who bought a Blackberry Z10 in May 2013 at VND15.5 million, said he could not imagine the product would be so cheap at VND4.5 million after only one year. “My valuable asset has lost 4/5 of its value just within one year,” he said. “I know that technologies improve rapidly and new products are made every day, so hi-tech products get cheaper. However, I could not imagine such a sharp price decrease,” he said.
The sharp price falls have dealt a strong blow to smartphone retailers as well. The owner of a smartphone shop revealed he lost nearly VND100 million lately when the manufacturer cut the selling price of Blackberry Z10. Blackberry only provides products to some official resellers, so other distributors suffer when they could not sell products before the manufacturer made the price-cut decision.
The distributor commented that the Vietnamese high-end smartphone market segment is, to some extent, in a mess. Distributors now are very skeptical when deciding what models to sell because they fear they cannot sell most of the products before the next price cuts. VnMedia has quoted foreign sources as reporting that smartphones and tablets running on Windows and other platforms will see sharp price drops this year.
Source: Vietnamnet