Sellout of latest iPad 2 shipment raises questions about Apple's international launch

Posted:
in iPad edited January 2014
New shipments of the iPad 2 to some Apple stores around the country on Tuesday immediately sold out, raising questions for one analyst about how much inventory Apple will have available for next week's international launch.



Brian White with Ticonderoga Securities checked with stores in New York City and San Francisco on Tuesday, and found that a few stores received additional shipments of the iPad 2. All of those that had a delivery sold out this morning, or will sell out over the next couple of hours, he said.



Not all Apple stores received iPad 2 shipments this morning, and those that did receive new units to sell saw much smaller quantities than last Friday's launch.



A number of stores opened an hour early on Tuesday in anticipation of having a new supply of iPads. However, some customers around the country lined up at stores that did in fact open an hour early, but without any of the iPad 2 in stock.



"The lines to buy the iPad 2 in New York City and San Francisco were again quite a spectacle this morning, a trend we believe will occur throughout the week," White wrote in a note to investors. "In New York City, three of the four stores already sold out of the iPad 2 in the first couple of hours this morning, and tickets were handed out at the flagship store to help people avoid waiting in line unnecessarily.



"Additionally, the flagship San Francisco store opened an hour early and was also handing out tickets to a line of well over 400 people. Those at the end of this line were told the likelihood of getting an iPad 2 this morning were slim."



White said that just one of three stores in San Francisco received new shipments Tuesday morning.







Given the limited availability and strong demand for the iPad 2 in the U.S. alone, White has questioned whether Apple will have enough supply for an international launch scheduled for March 25. The iPad 2 is set to launch in more than two dozen countries next Friday, though the Japanese launch has been delayed due to the recent earthquake disaster.



Last year, Apple was forced to delay the international launch of the first-generation iPad by a month. Demand for the first-generation device was greater than Apple had anticipated, and the company could not fulfill U.S.-only orders.



The iPad 2 is still scheduled to go on sale March 25 in Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Spain, Sweden, Switzerland and the U.K. Apple has said that availability for many more countries around the world will occur in the coming months. Further international availability and pricing will be announced at a later date.
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Comments

  • Reply 1 of 121
    markbmarkb Posts: 153member
    Was at the store in Cincinatti this morning at 8 am. Should have gotten there at 6 am. At 8 am there were about 200 people and only the first 70 or so got an ipad. At least they told us quickly.



    I was at Best Buy at lunch, and they had two on display. They said they had about 70 on hand at launch and none since.



    I would guess they are either just ramping or there is a major constraint on some part.



    Back of the envelope calc for day 1 = 400k:

    200 ish Apple stores at 1000 ipads each = 200k

    10,000 distrbution points at 20 per (Best Buy, Target, ATT etc) = 200k

    Online orders = 0 (they didnt ship any day one right?)



    So in general I would guess they shipped between 350-550K on day one with ZERO online orders fufilled. I dont think it is conceivable that they thought this would meet demand. Hence not allowing pre-orders so they could push online orders out a little and attempt to stock up.



    I would say its looking pretty grim for the rest of the world in terms of March 25 Shipments.
  • Reply 2 of 121
    rbonnerrbonner Posts: 635member
    There was a line here in Austin this AM at the temp downtown Austin store. My wife said that UPS delivered over 100 boxes, each the size of 8 iPads. They didn't sell out yesterday, but expect to today. They only had the 64GB black models and a few white 16GB available.
  • Reply 3 of 121
    paxmanpaxman Posts: 4,670member
    Its the iPhone4 all over again. A month after the launch you still had to line up at 7 am. Not many manufacturers of anything at all have this 'problem'. Everybody just has to chill and put their purchase back at least a month. Ouch!
  • Reply 4 of 121
    bageljoeybageljoey Posts: 1,937member
    I was afraid if this...
  • Reply 5 of 121
    maccherrymaccherry Posts: 924member
    give me an effing break. Here we go with perception used to screw with the stock.

    Look, ipad 2 is a hit. I held it in my hand today at the Apple store right across the street from my house. It is awesome. But those who want it will get it. Wait!!!!!

    Hell, why is it a bummer if you can't get it right right now?
  • Reply 6 of 121
    [greg][greg] Posts: 78member
    Quote:
    Originally Posted by AppleInsider View Post


    Last year, Apple was forced to delay the international launch of the iPad 2 by a month.



    oops
  • Reply 7 of 121
    modemode Posts: 163member
    Artificial supply shortage to drive demand - lineups and mass impulse buying expedited.

    How do you drive a market to covet your product - tell them it's in limited supply.

    This tactic is routine in a lot of business. People want what they can't have.



    Nowhere is this practiced more then in the tech industry.

    Also a great way to determine and monitor market demand.



    Could this be the case here? The timing of the international release is interesting. It's different from their iPhone strategy, but that may be because of carriers.
  • Reply 8 of 121
    mstonemstone Posts: 11,510member
    I would imagine that the international inventory is already in transit. Apple has sold out the US allotment but has most likely allocated substantial quantities for the the international rollout.
  • Reply 9 of 121
    The iPad demand is found outside the US, right? Apple knows this, right? Constrained shipments in the US are for a reason...the launch of this year's iPad outside the US will go on as planned.\
  • Reply 10 of 121
    apple ][apple ][ Posts: 9,233member
    They should continue with the international launch as planned, but don't give the foreigners too many iPads. Make them wait in long lines, just like everybody else has to do here in the US.
  • Reply 11 of 121
    alienzedalienzed Posts: 393member
    If only I had known they had the iPad 2 out last year, all of this could have been avoided.

    tsk tsk
  • Reply 12 of 121
    Quote:
    Originally Posted by Mode View Post


    Artificial supply shortage to drive demand - lineups and mass impulse buying expedited.

    How do you drive a market to covet your product - tell them it's in limited supply.

    This tactic is routine in a lot of business. People want what they can't have.



    Nowhere is this practiced more then in the tech industry.

    Also a great way to determine and monitor market demand.



    Could this be the case here? The timing of the international release is interesting. It's different from their iPhone strategy, but that may be because of carriers.



    With initial reports estimating that some 1 million were sold in its opening weekend, it doesn't seem like Apple is artificially restricting supplies.
  • Reply 13 of 121
    MacProMacPro Posts: 19,383member
    Good problem to have. Better than having to explain why 'sales in' were way higher than 'sales out'!
  • Reply 14 of 121
    bageljoeybageljoey Posts: 1,937member
    Quote:
    Originally Posted by maccherry View Post


    give me an effing break. Here we go with perception used to screw with the stock.

    Look, ipad 2 is a hit. I held it in my hand today at the Apple store right across the street from my house. It is awesome. But those who want it will get it. Wait!!!!!

    Hell, why is it a bummer if you can't get it right right now?



    Having to wait is one thing, having people line up for hours to be disappointed is another. No doubt, the iPad is a hit and it will sell millions. I just worry about the Apple brand. My belief (and I know many don't agree) is that in small doses these shortages drive excitement, but if they are too frequent I worry about engendering resentment. People (at least in America) want to root for the underdog but all too often they like to see the big guy brought low.



    Apple isn't the little guy anymore!
  • Reply 15 of 121
    MacProMacPro Posts: 19,383member
    Quote:
    Originally Posted by Mode View Post


    Artificial supply shortage to drive demand - lineups and mass impulse buying expedited.

    How do you drive a market to covet your product - tell them it's in limited supply.

    This tactic is routine in a lot of business. People want what they can't have.



    Nowhere is this practiced more then in the tech industry.

    Also a great way to determine and monitor market demand.



    Could this be the case here? The timing of the international release is interesting. It's different from their iPhone strategy, but that may be because of carriers.



    Perhaps Xoom, Playbook and Galaxy sales departments should try that, it might help . Apple on the other hand really sells everything they can make. Hard to take for Apple haters I know, my heart goes out to them.
  • Reply 16 of 121
    paxmanpaxman Posts: 4,670member
    Quote:
    Originally Posted by Mode View Post


    Artificial supply shortage to drive demand - lineups and mass impulse buying expedited.

    How do you drive a market to covet your product - tell them it's in limited supply.

    This tactic is routine in a lot of business. People want what they can't have.



    Nowhere is this practiced more then in the tech industry.

    Also a great way to determine and monitor market demand.



    Could this be the case here? The timing of the international release is interesting. It's different from their iPhone strategy, but that may be because of carriers.



    You don't really believe this, do you? Maybe Apple paid all those people to line up to create an impression of huge demand? I think you need to put your tin foil hat away and go and try an iPad 2. The demand is driven by its awesomeness. Apple can sell as many as they can produce. The shortage is a byproduct of Apple's success with the iPad. I doubt if the shortage plays into Apple's hands here, though in some cases I am sure you are right. Its a risky strategy, however.
  • Reply 17 of 121
    c4rlobc4rlob Posts: 277member
    At least Motorola got one thing right in their commercial - there would be an ocean of Apple customers vastly outnumbering Xoom customers.
  • Reply 18 of 121
    MacProMacPro Posts: 19,383member
    Quote:
    Originally Posted by mstone View Post


    I would imagine that the international inventory is already in transit. Apple has sold out the US allotment but has most likely allocated substantial quantities for the the international rollout.



    Quick, quick ... bring em back we need them
  • Reply 19 of 121
    mdriftmeyermdriftmeyer Posts: 7,502member
    Quote:
    Originally Posted by Bageljoey View Post


    Having to wait is one thing, having people line up for hours to be disappointed is another. No doubt, the iPad is a hit and it will sell millions. I just worry about the Apple brand. My belief (and I know many don't agree) is that in small doses these shortages drive excitement, but if they are too frequent I worry about engendering resentment. People (at least in America) want to root for the underdog but all too often they like to see the big guy brought low.



    Apple isn't the little guy anymore!



    No other giant in the PC industry has ever dealt with this size of distribution as a single entity. Apple isn't holding back on supplies. Third parties should have the focus be put on them and question the real capacity of those manufacturers.
  • Reply 20 of 121
    apple ][apple ][ Posts: 9,233member
    Quote:
    Originally Posted by Bageljoey View Post




    Apple isn't the little guy anymore!



    That is true, Apple is the big guy on the block now.



    To be honest, I wouldn't even care if they became slightly smaller. I liked them when they were small and I like them now when they're big. They deserve to be big. Those people who are true Apple users will like Apple no matter how big or small they are. If somebody doesn't understand the true value and benefit of Apple's computers and devices, then it wouldn't bother me if those people jumped ship. Sometimes I think that Apple is too popular and I don't like all of these new Apple users that I see sometimes using Apple products. There will always be enough people around who will stick with Apple regardless.
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