We all know the tragic news Data Recovery Services of the floods in Thailand in 2011. For those who don’t know, these floods did not just affect the physical aspect, but it also affected the politics as well as economical. It killed about 350 people. This was actually a hard blow to the hard drives companies.
Normally the total demand of the hard drives in the world is about 600 million units in a year. Seagate and Western Digital share over 30% of the demand while the rest make the other money. In a world that has 7 billion as the population, you might note the percentage is way high.
The Thailand flood shut down about 14000 factories. This became a big problem for the Western Digital and Seagate because they were the main suppliers. The Westgate Digital had to shut down while the Seagate was not able to meet their normal hard drive demands. First there was no Data Recovery Services work for about 660,000 people due to the flooding. Both the companies, were facing a lot of challenges including trying to help out the employees to get back to their feet, they also needed to save their equipment from getting damaged by the flood.
They didn’t know when they were going to begin selling, this is because about 60% of the hard drives are produced in Thailand. This definitely affected their first quarters. Most of the industry were trying to shift their production to china as well as Philippines to salvage their production including Nidec. Yet the remaining hard drive makers were not able to meet the demand.
This ended up hiking the prices of the hardware of about 10%, which later affected many devices prices eventually. This is because about 8-10% of the total cost of a PC is affected by the hardware. This include HP and Dell. The PC makers were not be affected immediately but they were Data Recovery Services definitely affected in the 4th quarter that is on November or December, which is worse because it was their peak on sales. Apple Company was not affected, this is because it uses hard drives and flash drives from MacBook and iPad.
It basically affected the whole IT Company, if you remember on this year Sony was launching its camera, lenses and headphone. But it had to postpone due to the world crisis. Other business as much as they were affected took this crisis and embraced to their own benefit, they ensured the customer knew they will be in shortage of hard drive and they needed to buy before so. This include the Info advantage company.
There was no choice but wait for the flood to be over. After that most businesses restructured and regrouped looking for strategy of earning profit after such a predicament. It took two year for the hard drive price to be normal. It is understandable why the price had hiked up, but still this shunned off many customers, many preferred living without it. The minute the price went down the customers began to buy and they were pleased.