Craig Nowitz, CEO of Syntech Distribution, outlines why 2025 is a wake-up call for the channel
Craig Nowitz, CEO of Syntech.
We are witnessing a structural transformation in the global tech supply chain, not just a temporary spike. The explosive growth of AI infrastructure has fundamentally broken the old pricing models for memory and SSDs, and South African businesses are about to feel the aftershock.
The next few months will be difficult for partners as we deal with this fallout. Driven by an explosive appetite for data, global hyperscalers like Microsoft and Amazon are absorbing the world’s supply of server-grade DRAM and high-bandwidth memory. The numbers do not lie. Reports suggest that even Tier 1 hyperscalers are receiving only 70% of their DRAM orders, while smaller OEMs are fulfilling just 40%.
Manufacturers are aggressively pivoting to these high-margin enterprise clients. The result? Consumer-grade DDR4 and DDR5 modules, the bread and butter of our retail and integrator channels, are becoming significantly harder to source and much more expensive.
SSDs feel the heat
The NAND flash market is following a similar trajectory to DRAM, driven by the same capacity constraints. Samsung and other major suppliers have raised prices on server SSDs by up to 35%, and consumer models are not far behind.
We are seeing a market where capacity is being diverted away from the channel, creating tightness in availability that we haven’t seen in years.
TrendForce projects DRAM prices will continue rising 13% to 18% quarter-over-quarter into 2026. Some analysts warn of a potential decade-long NAND shortage if capacity doesn’t expand quickly.
Adapting to the new reality
For local businesses, this creates a unique challenge. South Africa is feeling the impact of a “double blow”, global component shortages compounded by currency volatility. When dollar pricing rises and stock becomes scarce, the local cost impact is magnified. Despite the Rand performing well against the Dollar of late, this isn’t making a dent in memory and SSD pricing.
Where we used to see stable pricing and predictable availability, we are now navigating weekly volatility and strict allocation constraints. This is a new reality for the tech industry, and the old playbook simply doesn’t apply anymore.
At Syntech, we have had to become more agile and transparent to reflect these upstream cost pressures. We are constantly adjusting pricing and refining our strategic forecasting to navigate these longer lead times.
Advice to our partners
If you are a reseller, system builder, or IT manager, waiting for prices to “normalise” is a losing strategy. My advice is clear: Plan, secure stock early, communicate with your suppliers, educate your clients, and be prepared for continued volatility.
This is a defining moment for the channel. It brings challenges, but it also rewards those who plan, innovate, and collaborate. At Syntech, we are committed to navigating this landscape with you.
Let’s get to work. Good luck for the rest of 2025.