Flash Drive Prices Fall in February

After several months of volatility, the price of USB flash drives finally started to level out and show the first signs of sustained falls towards the latter end of February 2011.

USB Flash drive with stock exchange style numbers and graphicsSeveral factors have come together to drive these price reductions:

1)      Factories Return - The factories that manufacture the USB flash drives in China are now back up to full speed following the prolonged closure that takes place every year around the Chinese New Year holidays. In the build up to the holidays the factories see a huge surge in demand as customers try to get their orders shipped before the 3-week closure. This creates a short term “blip” in pricing as demand outstrips supplies.

Once the factories are back at work and the production lines are again running at full speed there is typical a “post Chinese New Year Holiday void” that needs filling and this leads to a fall in the price.

2)      Sterling gains ground against the Dollar - Typically all of the factories that manufacture USB flash drives ask to be paid in US Dollars so the end price in the UK and Europe is subject to any fluctuations in the currency market. From a high of $1.44 to the £1 in 2010 the dollar has now weakened to $1.63 – a fall of around 13%. This fall maps directly onto the price of the flash drives sold in the UK and Europe. Ironically, rising interest rates (or the expectation of rising interest rates) which are painful for consumers and businesses are driving the current strength of Sterling and driving down imports like USB flash drives.

3)      Seasonal Trends – history shows that price of flash memory and USB flash drives falls steadily between February and June, In June the manufactures of some of the most popular consumer brands electrical products (mobile phones, tablets, MP3 players etc.) all start placing their Christmas orders and this spike in demand drives up prices again.

So, if you are looking to buy USB flash drives and you’re requirement is not time critical then the best time to place your order is typically between late February and May. If you miss this window then try and leave it until September when prices start to fall again.

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