I'm sure the #s they provide to the factories are based off the #s of sales from the previous launch.
Granted I know there's only so many pre launch devices they can make, but like most retail business year over year sales are determined by the previous year. So it would stand to reason #s provided to the manufactures by Apple are based on previous sales figures would it not?
One of the things Apple has always excelled at has been the creation of demand; sometimes false demand by constricting its own supply chain.
When a product becomes out-of-stock, it creates a situation where the product is "perceived" as more valuable by the consumer.
When people in the press can't purchase it either, then the press will write about it in a more favorable light once the product is obtained as well. This is something carefully balanced by Apple and a part of its branding, marketing, and supply chain strategy.
Look at it this way- People know when they go to a McDonald's they can get a McDonald's signature BigMac Burger but only Apple would deny its customers the ability to tender a sale. No one in the press writes about how tasty their last BigMac burger was because they are ready for purchase.
It takes a stroke of genius to deny Dieter Bohn his ability to be the first in the office to buy an Apple.
Would you mind providing evidence if you conspiracy theory? Also, would you mind explaining why a company would not take customers' money? Your explanation doesn't hold water for many reasons. First, the most influential people in the media get review units and don't have to be denied their initial purchase. Second, the phone launches late in the quarter so they MUST sell as many phones as they can make in order to help their ER. Third, it's insanely stupid to intentionally deny your customers the ability to buy your produce since most normal people will not wait forever to get the new X, they'll just go buy the new Y.
Do you really need to ask for evidence? Apple has been selling iPhones for 10 years. Don't you think by no they would have figured out how many they need onblaunch. Instead they seem to be sold out every single year. Taking weeks to catch up. That seems like evidence enough
I know this business stuff can be complicated Malcolm, but bear with me. What you are suggesting sounds fine from the perspective of someone sitting around frustrated that the latest iPhone they are craving is not in stock-- This happens all the time, why doesn't Apple just produce all the products everyone wants so they are in stock on day one and none of us have to wait for the products we love??? Is it all a conspiracy as you suggest? Is Tim Cook telling Foxconn to slow down production so the lines are long and people are crying for the Airpods? No, LOL, that's not how business works. Apple and other companies would love to have every model in stock so every customer could immediately buy as they know some of those will folks will buy a competitors product or use their money for something else and some of those lost sales will never come back.
IfApple and other companies did what you are suggesting, they would have to spend billions of dollars to build more and larger factories and hire hundreds of thousands of more workers to work in those factories to meet some estimate of PEAK demand. Once that peak demand was over, they would now have massive unused factories and hundreds of thousands of idle workers to lay off. The costs would skyrocket with the waste of billions. Workers would get screwed as they faced massive layoffs. Costs that we would all end up paying for, just to satisfy some unreasonable fantasy that no one should ever have to wait for a popular product. The business world doesn't work that way, fortunately. Instead they have to do careful cost benefit analysis of how much can reasonably be produced to meet estimated demand over a given period of time. Yes, they will use OT and try to increase capacity, but your fantasy that they will be able to produce enough so that no one ever has to wait starting on day one does not reflect reality for a popular product sold in the hundreds of millions.
Hopefully that clears things up and you understand that it's not all some big conspiracy by major companies to not let you buy their products when you want to.
One of the things Apple has always excelled at has been the creation of demand; sometimes false demand by constricting its own supply chain.
When a product becomes out-of-stock, it creates a situation where the product is "perceived" as more valuable by the consumer.
When people in the press can't purchase it either, then the press will write about it in a more favorable light once the product is obtained as well. This is something carefully balanced by Apple and a part of its branding, marketing, and supply chain strategy.
Sorry but this argument is absolute rubbish. Apple is already the largest, most successful, most profitable widget maker in the world. It got this way by selling actual goods. It no longer needs any benefit that would come from your proposed artificial scarcity. No, they get their billions upon billions of profit in the bank by selling actual products to actual people. Not selling them just to "create buzz" flies counter to doing what real business people do -- make money. Profit is the air corporations breath.
I mean, even if they wanted to do so, which manager would make the order to sit on inventory paying rent for nothing? A middle manager? No surely not, he'd be fired. So Tim Cook then? No because this would be against stockholder interest and again he'd be fired. So who?
One of the things Apple has always excelled at has been the creation of demand; sometimes false demand by constricting its own supply chain.
When a product becomes out-of-stock, it creates a situation where the product is "perceived" as more valuable by the consumer.
When people in the press can't purchase it either, then the press will write about it in a more favorable light once the product is obtained as well. This is something carefully balanced by Apple and a part of its branding, marketing, and supply chain strategy.
Look at it this way- People know when they go to a McDonald's they can get a McDonald's signature BigMac Burger but only Apple would deny its customers the ability to tender a sale. No one in the press writes about how tasty their last BigMac burger was because they are ready for purchase.
It takes a stroke of genius to deny Dieter Bohn his ability to be the first in the office to buy an Apple.
Would you mind providing evidence if you conspiracy theory? Also, would you mind explaining why a company would not take customers' money? Your explanation doesn't hold water for many reasons. First, the most influential people in the media get review units and don't have to be denied their initial purchase. Second, the phone launches late in the quarter so they MUST sell as many phones as they can make in order to help their ER. Third, it's insanely stupid to intentionally deny your customers the ability to buy your produce since most normal people will not wait forever to get the new X, they'll just go buy the new Y.
Do you really need to ask for evidence? Apple has been selling iPhones for 10 years. Don't you think by no they would have figured out how many they need onblaunch. Instead they seem to be sold out every single year. Taking weeks to catch up. That seems like evidence enough
Only to a person who has no grasp of manufacturing. It's been discussed here annually every time they sell out on launch day. The short answer: iPhones dont grow on trees. They're complicated devices which take lots of components and time to assemble, and millions and millions and of people want it on Day 1. That level of demand is impossible to meet because you'd have to buy more factories and equipment lines and infrastructure and people but then after the initial surge of demand it would all have to go away. No other consumer electronics good in the history of our species has this sort of success or demand. It's just not possible to build every single one in advance, thus some people have to wait a while.
One of the things Apple has always excelled at has been the creation of demand; sometimes false demand by constricting its own supply chain.
When a product becomes out-of-stock, it creates a situation where the product is "perceived" as more valuable by the consumer.
When people in the press can't purchase it either, then the press will write about it in a more favorable light once the product is obtained as well. This is something carefully balanced by Apple and a part of its branding, marketing, and supply chain strategy.
Look at it this way- People know when they go to a McDonald's they can get a McDonald's signature BigMac Burger but only Apple would deny its customers the ability to tender a sale. No one in the press writes about how tasty their last BigMac burger was because they are ready for purchase.
It takes a stroke of genius to deny Dieter Bohn his ability to be the first in the office to buy an Apple.
Third, it's insanely stupid to intentionally deny your customers the ability to buy your produce since most normal people will not wait forever to get the new X, they'll just go buy the new Y.
No actual fan of Apple (or Android for that matter) would leap to the other side simply because they needed to wait an extra two weeks for the latest model. So while I don't agree with the OP that Apple artificially restricts supply, even if they did they wouldn't lose sales because of it IMHO.
You're conflating fans for mass consumers. There are plenty of people in the carrier phone store who will say "Oh, it's out of stock? No I'm not waiting 5 weeks, what else do you have?" and walk out with a phone. That absolutely happens.
I'm sure the #s they provide to the factories are based off the #s of sales from the previous launch.
Granted I know there's only so many pre launch devices they can make, but like most retail business year over year sales are determined by the previous year. So it would stand to reason #s provided to the manufactures by Apple are based on previous sales figures would it not?
Yes but there's only 24-hours in a day. To fulfill the unnatural level of demand on launch day would push production back further and further into development, all at costs. It just doesn't make sense when the alternative is some people gotta wait.
It's like a popular restaurant that has a wait every Saturday night. If they know their peak demand is more than they can hold, why don't they just add another dining room to the building? Because it's expensive and it won't get used the rest of the week. So, people gotta wait. World keeps spinning.
I'm sure the #s they provide to the factories are based off the #s of sales from the previous launch.
Granted I know there's only so many pre launch devices they can make, but like most retail business year over year sales are determined by the previous year. So it would stand to reason #s provided to the manufactures by Apple are based on previous sales figures would it not?
Yes but there's only 24-hours in a day. To fulfill the unnatural level of demand on launch day would push production back further and further into development, all at costs. It just doesn't make sense when the alternative is some people gotta wait.
It's like a popular restaurant that has a wait every Saturday night. If they know their peak demand is more than they can hold, why don't they just add another dining room to the building? Because it's expensive and it won't get used the rest of the week. So, people gotta wait. World keeps spinning.
Not according to what you just said only one post above this one. Joe Consumer won't wait and instead will get something other than that iPhone he went in for, right?
I believe Wall Street expects Apple to simply keep growing iPhone sales numbers quarter after quarter which I consider pure greed. I know when I was growing up I was taught to hold onto a product that was still in good working order and useful. We'd buy a good product and keep it for a few years until it broke or became too costly to repair. I honestly don't know where this changed to simply toss out a working product to buy a newer and upgraded product EVERY year. Do most consumers really have some unlimited cash flow where they just buy electronics items to discard them while they're still functional? Hardly. Sure, I can understand there may be a few people like that but I doubt they're in the majority. iPhones are relatively expensive, so unless the owner can sell an older iPhone to someone else to buy a new iPhone, this Wall Street dream of consumers buying a new iPhone every year is just ridiculous.
Most of the products I have around the house, I paid a decent amount of money for and I expect to hold onto them for a long time. Maybe Apple has tapped out the consumer market who can afford to have old iPhones thrown into drawers just to buy a new one. I don't care what amazing new features an iPhone (or any smartphone) offers, there has to be a serious incentive to buy a new one every year. Most consumers can only afford cheap Android smartphones and that's the reason I believe as to why Apple can't sell increasing numbers of iPhones every year. Wall Street would prefer companies build some crappy junk product that needs to be replaced every year. They're damn fools for wanting to live that way.
Wall Street sees consumers holding off on buying new products as a bad thing, but we ought to have some concerns about our ecology and how we utilize our money. The longer a good product can last a consumer, I would consider that a good thing as a consumer. I'm not looking for some dazzling new trinket every year and I find it hard to believe most consumers are. The people I know aren't like Wall Street's description of consumers. The people I know have more pressing issues of spending their money on more than some new smartphone. I would think a flagship smartphone would easily be good for at least two years use.
Apple should concentrate on supporting older iPhones with paid services. With a growing base of functional iPhones, Apple should be able to make a steadily growing income supply services even if they can't sell iPhones in record numbers every year. The larger the iPhone base grows every year, it should represent a decent amount of revenue on top of outright iPhone sales. Why Wall Street doesn't see this aspect, I have no idea.
Apple stock falls not because of this but because of lawsuit it failed to implement a technology in FaceTime. But the news does not say what the technology is.
One of the things Apple has always excelled at has been the creation of demand; sometimes false demand by constricting its own supply chain.
When a product becomes out-of-stock, it creates a situation where the product is "perceived" as more valuable by the consumer.
When people in the press can't purchase it either, then the press will write about it in a more favorable light once the product is obtained as well. This is something carefully balanced by Apple and a part of its branding, marketing, and supply chain strategy.
Look at it this way- People know when they go to a McDonald's they can get a McDonald's signature BigMac Burger but only Apple would deny its customers the ability to tender a sale. No one in the press writes about how tasty their last BigMac burger was because they are ready for purchase.
It takes a stroke of genius to deny Dieter Bohn his ability to be the first in the office to buy an Apple.
Apple doesn't create false demand by artificially constraining supply. Why wouldn't they want to sell every product they make? False constraints give buyers time to think over a possible purchase or choose a competitor's products.
Since when is 65-70 MM of anything deemed sluggish?
Also. The dollar is too expensive all over the world. Here in Mexico, it went up 61% from 13 to 21 pesos per dollar. Everything that I used to buy from tue US is now more than twice the price. Movies, games, gadgets etc. To get a new iphone 7 128 GB with a 2 year contract I would've had to pay about $800 dollars. Last time I paid $450. So for now... I'm keeping my iphone 6.
I was just in a few tourist areas in Mexico, nothing was cheaper than last year for those of us with US$. Strange how that works. Someone was making a killing for sure!
Of course Apple will reduce production after holiday season….. this is making sometging out of nothing …vulgar manipulation.
Nikkei can go F itself…. it seems like is becoming a ritual for them…. and i feel bad for those who fall for their FUD.
When will Tim Cook ever do a solitary thing right? Even a broken clock is right twice a day. Pity to watch Apple atrophy under Cook/Schiller inept mismanagement.
Well, I'm doing my part - finally gave in and got a 7plus yesterday on Apple's replacement plan (just in case the 8 is that much better!). My wife thinks it's her Christmas present to me...I let her think that... Pain in the ass of course getting all my music on and books in the Kindle reading app, and reviewing all the settings for possible changes, but, I can't remember the last time I felt so good about a new toy! (It makes my hand feel happier than almost anything else )
It's important to note how adept Apple's competitors have become, not necessarily at making admirable alternatives, but at affecting Apple releases, generally through their media allies. It's going to affect the 7's sales when articles about the projected features of the 8 begin appearing almost immediately. I don't remember quite so much smoke about the 6s or the 7 when the 6's appeared.
Apple stock falls not because of this but because of lawsuit it failed to implement a technology in FaceTime. But the news does not say what the technology is.
Apple has a patent on preventing a user from using a program while the device is in motion. The suit is horse hockey. Because a company has a patent doesn't mean they are required to use it. If it is required of the patent holder, what then of competitors? Do they get a free pass or are they required to implement the patent? What about user responsibility? How does the patent differentiate between a driver and passenger?
lots of stupid lawsuits from peoplle blaming others for their stupidity.
Slower than expected! are you kidding me? I went to Apple every day for two months and they never had a plus! How do you expect the sell a thing when you don't make a thing? Same for the watch. Seriously?
When will Tim Cook ever do a solitary thing right? Even a broken clock is right twice a day. Pity to watch Apple atrophy under Cook/Schiller inept mismanagement.
I'm sure the #s they provide to the factories are based off the #s of sales from the previous launch.
Granted I know there's only so many pre launch devices they can make, but like most retail business year over year sales are determined by the previous year. So it would stand to reason #s provided to the manufactures by Apple are based on previous sales figures would it not?
Yes but there's only 24-hours in a day. To fulfill the unnatural level of demand on launch day would push production back further and further into development, all at costs. It just doesn't make sense when the alternative is some people gotta wait.
It's like a popular restaurant that has a wait every Saturday night. If they know their peak demand is more than they can hold, why don't they just add another dining room to the building? Because it's expensive and it won't get used the rest of the week. So, people gotta wait. World keeps spinning.
Not according to what you just said only one post above this one. Joe Consumer won't wait and instead will get something other than that iPhone he went in for, right?
Like I said in that post, you were conflating fans for mass consumers. People who want iPhones (fans) gotta wait, just like people who really want to eat at their fav restaurant gotta wait. But there are plenty of people who have less patience and won't.
One of the things Apple has always excelled at has been the creation of demand; sometimes false demand by constricting its own supply chain.
When a product becomes out-of-stock, it creates a situation where the product is "perceived" as more valuable by the consumer.
When people in the press can't purchase it either, then the press will write about it in a more favorable light once the product is obtained as well. This is something carefully balanced by Apple and a part of its branding, marketing, and supply chain strategy.
Look at it this way- People know when they go to a McDonald's they can get a McDonald's signature BigMac Burger but only Apple would deny its customers the ability to tender a sale. No one in the press writes about how tasty their last BigMac burger was because they are ready for purchase.
It takes a stroke of genius to deny Dieter Bohn his ability to be the first in the office to buy an Apple.
Whether true or not for Apple, when Hostess went bankrupt, you couldn't find a Twinkie or a Ding Dong anywhere within a couple of days of that announcement. Real world example.
Comments
Granted I know there's only so many pre launch devices they can make, but like most retail business year over year sales are determined by the previous year. So it would stand to reason #s provided to the manufactures by Apple are based on previous sales figures would it not?
I know this business stuff can be complicated Malcolm, but bear with me. What you are suggesting sounds fine from the perspective of someone sitting around frustrated that the latest iPhone they are craving is not in stock-- This happens all the time, why doesn't Apple just produce all the products everyone wants so they are in stock on day one and none of us have to wait for the products we love??? Is it all a conspiracy as you suggest? Is Tim Cook telling Foxconn to slow down production so the lines are long and people are crying for the Airpods? No, LOL, that's not how business works. Apple and other companies would love to have every model in stock so every customer could immediately buy as they know some of those will folks will buy a competitors product or use their money for something else and some of those lost sales will never come back.
IfApple and other companies did what you are suggesting, they would have to spend billions of dollars to build more and larger factories and hire hundreds of thousands of more workers to work in those factories to meet some estimate of PEAK demand. Once that peak demand was over, they would now have massive unused factories and hundreds of thousands of idle workers to lay off. The costs would skyrocket with the waste of billions. Workers would get screwed as they faced massive layoffs. Costs that we would all end up paying for, just to satisfy some unreasonable fantasy that no one should ever have to wait for a popular product. The business world doesn't work that way, fortunately. Instead they have to do careful cost benefit analysis of how much can reasonably be produced to meet estimated demand over a given period of time. Yes, they will use OT and try to increase capacity, but your fantasy that they will be able to produce enough so that no one ever has to wait starting on day one does not reflect reality for a popular product sold in the hundreds of millions.
Hopefully that clears things up and you understand that it's not all some big conspiracy by major companies to not let you buy their products when you want to.
I mean, even if they wanted to do so, which manager would make the order to sit on inventory paying rent for nothing? A middle manager? No surely not, he'd be fired. So Tim Cook then? No because this would be against stockholder interest and again he'd be fired. So who?
Only to a person who has no grasp of manufacturing. It's been discussed here annually every time they sell out on launch day. The short answer: iPhones dont grow on trees. They're complicated devices which take lots of components and time to assemble, and millions and millions and of people want it on Day 1. That level of demand is impossible to meet because you'd have to buy more factories and equipment lines and infrastructure and people but then after the initial surge of demand it would all have to go away. No other consumer electronics good in the history of our species has this sort of success or demand. It's just not possible to build every single one in advance, thus some people have to wait a while.
You're conflating fans for mass consumers. There are plenty of people in the carrier phone store who will say "Oh, it's out of stock? No I'm not waiting 5 weeks, what else do you have?" and walk out with a phone. That absolutely happens.
It's like a popular restaurant that has a wait every Saturday night. If they know their peak demand is more than they can hold, why don't they just add another dining room to the building? Because it's expensive and it won't get used the rest of the week. So, people gotta wait. World keeps spinning.
Most of the products I have around the house, I paid a decent amount of money for and I expect to hold onto them for a long time. Maybe Apple has tapped out the consumer market who can afford to have old iPhones thrown into drawers just to buy a new one. I don't care what amazing new features an iPhone (or any smartphone) offers, there has to be a serious incentive to buy a new one every year. Most consumers can only afford cheap Android smartphones and that's the reason I believe as to why Apple can't sell increasing numbers of iPhones every year. Wall Street would prefer companies build some crappy junk product that needs to be replaced every year. They're damn fools for wanting to live that way.
Wall Street sees consumers holding off on buying new products as a bad thing, but we ought to have some concerns about our ecology and how we utilize our money. The longer a good product can last a consumer, I would consider that a good thing as a consumer. I'm not looking for some dazzling new trinket every year and I find it hard to believe most consumers are. The people I know aren't like Wall Street's description of consumers. The people I know have more pressing issues of spending their money on more than some new smartphone. I would think a flagship smartphone would easily be good for at least two years use.
Apple should concentrate on supporting older iPhones with paid services. With a growing base of functional iPhones, Apple should be able to make a steadily growing income supply services even if they can't sell iPhones in record numbers every year. The larger the iPhone base grows every year, it should represent a decent amount of revenue on top of outright iPhone sales. Why Wall Street doesn't see this aspect, I have no idea.
Since when is 65-70 MM of anything deemed sluggish?
My wife thinks it's her Christmas present to me...I let her think that...
Pain in the ass of course getting all my music on and books in the Kindle reading app, and reviewing all the settings for possible changes,
but, I can't remember the last time I felt so good about a new toy! (It makes my hand feel happier than almost anything else
It's important to note how adept Apple's competitors have become, not necessarily at making admirable alternatives, but
at affecting Apple releases, generally through their media allies.
It's going to affect the 7's sales when articles about the projected features of the 8 begin appearing almost immediately.
I don't remember quite so much smoke about the 6s or the 7 when the 6's appeared.
lots of stupid lawsuits from peoplle blaming others for their stupidity.