Speculation: iPhone shortages not as bad as we think?

[Vertigo50]

This is just total speculation on my part, but I just had a thought.

We have all assumed that Apple is pushing back iPhone delivery dates because they only have so much stock produced or available for certain dates. We're also assuming this means that stores won't have as much stock as previous years.

What if they are pushing the dates back for other reasons, such as the difficulty of shipping that many phones reliably by a certain date?

If you think about it, shipping 2,000 phones to a retail store is fairly easy, and then the store can take care of customers individually. Processing and shipping 2,000 phones to individuals is a lot more complicated, and every customer has to be verified with AT&T for pricing, etc.

Maybe they have a lot more stock then we thought, but they're playing it safe so that they don't get into a bind with processing so many orders, and maybe they have a lot more stock for retail stores than we are assuming they have.

 

[elephunkman]

shipping 2000 phones to customers is nothing to shipping companies. On a daily basis, FedEx probably ships over a million packages.

 

[HarrisonB]

This is just total speculation on my part, but I just had a thought.

We have all assumed that Apple is pushing back iPhone delivery dates because they only have so much stock produced or available for certain dates. We're also assuming this means that stores won't have as much stock as previous years.

What if they are pushing the dates back for other reasons, such as the difficulty of shipping that many phones reliably by a certain date?

If you think about it, shipping 2,000 phones to a retail store is fairly easy, and then the store can take care of customers individually. Processing and shipping 2,000 phones to individuals is a lot more complicated, and every customer has to be verified with AT&T for pricing, etc.

Maybe they have a lot more stock then we thought, but they're playing it safe so that they don't get into a bind with processing so many orders, and maybe they have a lot more stock for retail stores than we are assuming they have.

1.) Apple will deliver a crate to fedex and say GLHF
2.) Everyne has to be verified through the att system if you are in store or not. It is probably easier to have a large amount of people pre verified if they want to have a chance of keeping the system up on the 24th.

 

[STEVESKI07]

I somewhat agree with you. I think they are planning on stocking the apple stores up pretty good because they get more recognition that way. It's free advertising, unlike having to ship the phone's to people houses. They don't get any hype that way. Also, they will get a lot of people who aren't iPhone addicts like the majority of us to just walk in and see one and purchase one. They can't do that if they are constantly sold out. However, they did sell over 600,000 preorders on Day 1, so that is a lot of phone to dish out on release day. I could see them having 1 million phones to give out on release day, which would leave 400,000 for crazy people to fight over in the stores. There will definitely be an iPhone shortage for the first 3-4 weeks though.

 

[TSX]

I thought you were going to say something like, apple is saying there is a shortage just to drive up demand.

 

[DotCom2]

This is just total speculation on my part, but I just had a thought.

We have all assumed that Apple is pushing back iPhone delivery dates because they only have so much stock produced or available for certain dates. We're also assuming this means that stores won't have as much stock as previous years.

What if they are pushing the dates back for other reasons, such as the difficulty of shipping that many phones reliably by a certain date?

If you think about it, shipping 2,000 phones to a retail store is fairly easy, and then the store can take care of customers individually. Processing and shipping 2,000 phones to individuals is a lot more complicated, and every customer has to be verified with AT&T for pricing, etc.

Maybe they have a lot more stock then we thought, but they're playing it safe so that they don't get into a bind with processing so many orders, and maybe they have a lot more stock for retail stores than we are assuming they have.

That thought had crossed my mind as well.
I'm sure that FedEx, UPS whatever could only guaranty delivery on launch day up to a certain amount of units. Even if they had every employee and truck running. They are only human afterall. The demand this time may have met that limit.

 

[HarrisonB]

That thought had crossed my mind as well.
I'm sure that FedEx, UPS whatever could only guaranty delivery on launch day up to a certain amount of units. Even if they had every employee and truck running. They are only human afterall. The demand this time may have met that limit.

They move millions of packages a day. Each driver will wind up with like 50 extra packages on an established route most going to places they usually go.

 

[Vertigo50]

shipping 2000 phones to customers is nothing to shipping companies. On a daily basis, FedEx probably ships over a million packages.

That's not what I'm talking about. Of course the shipping companies can handle it.

But Apple and AT&T both have to verify every order. It has to be checked, processed, charged, etc. That takes a certain amount of man-power.

My point was that there are many other factors besides just availability of phones.

If someone came to you and gave you a list of orders and a box of 2,000 phones and said you had to have them all shipped out in 3 hours by yourself, what would you do? Just put it in perspective. It takes time and people.

I also think there is a slight chance they're driving up demand to have a HUGE launch day.

 

[bobsentell]

I agree with your premise but not your conclusion. I think Apple and AT&T have enough phones to meet the preorders and their moving the date back was to surpress demand long enough to get caught up. But they will raid the non-reserved stock to make up any differences. Generally, if Apple ships 2,000 phones to store A and they have 1500 preorders, then store A gets 500 to sell. If store B has 1800 preorders, then they only get 200 phones to sell. But Apple may take the 700 extras from the two stores and use those to fulfill online preorders. I belive waiting in line without a reservation will result in disappointment. Apple and AT&T will always ship to those that have preordered first, then put what is left out for sale.

My WAG, anyway.

 

[HarrisonB]

That's not what I'm talking about. Of course the shipping companies can handle it.

But Apple and AT&T both have to verify every order. It has to be checked, processed, charged, etc. That takes a certain amount of man-power.

My point was that there are many other factors besides just availability of phones.

If someone came to you and gave you a list of orders and a box of 2,000 phones and said you had to have them all shipped out in 3 hours by yourself, what would you do? Just put it in perspective. It takes time and people.

I also think there is a slight chance they're driving up demand to have a HUGE launch day.

A computer can print the one of mailing labels and place them on packages in a few minutes. This is a computer company after all.

 

[elephunkman]

That's not what I'm talking about. Of course the shipping companies can handle it.

But Apple and AT&T both have to verify every order. It has to be checked, processed, charged, etc. That takes a certain amount of man-power.

My point was that there are many other factors besides just availability of phones.

If someone came to you and gave you a list of orders and a box of 2,000 phones and said you had to have them all shipped out in 3 hours by yourself, what would you do? Just put it in perspective. It takes time and people.

I also think there is a slight chance they're driving up demand to have a HUGE launch day.

Conveyor belt with scanning machines.

 

[DotCom2]

They move millions of packages a day. Each driver will wind up with like 50 extra packages on an established route most going to places they usually go.

But all those packages are not *Guaranteed* to a specific date!
I get packages from FedEx that are often delayed or delivery date readjusted.
Just a thought.

 

[HarrisonB]

But all those packages are not *Guaranteed* to a specific date!
I get packages from FedEx that are often delayed or delivery date readjusted.
Just a thought.

Fedex wouldn't pass on the millions of dollars apple is giving them. Plus last year they shipped express overnight which IS guaranteed.

 

[Vertigo50]

That thought had crossed my mind as well.
I'm sure that FedEx, UPS whatever could only guaranty delivery on launch day up to a certain amount of units. Even if they had every employee and truck running. They are only human afterall. The demand this time may have met that limit.

The more I think about this, the more it all makes sense.

If you were Apple, you would want to take care of the customers who really want to pre-order or reserve the phone for launch day, so you set aside a large number for that, maybe 600,000 or so?

BUT, they sold around 1,000,000 phones on launch day of the 3GS. They don't want to sell less than that on launch day, so you hold 1.5 million or more for launch day, so that you can report record numbers and make the stock price go way up, not to mention all the hype of people waiting in line and smiling for the news cameras on their way out of the store with their shiny new phone.

So, where does that leave you? After you get through the allotted 600,000 phones you set aside, you have to push the ship date on pre-orders back. But not just a few days, you have to push it back far enough that the manufacturing plants have time to recover from the 1.5 million phones and have a new shipment coming in, which is about a week or two later.

All of this to say that I think there be a lot of demand, but also a lot of supply on launch day.

 

[HarrisonB]

The more I think about this, the more it all makes sense.

If you were Apple, you would want to take care of the customers who really want to pre-order or reserve the phone for launch day, so you set aside a large number for that, maybe 600,000 or so?

BUT, they sold around 1,000,000 phones on launch day of the 3GS. They don't want to sell less than that on launch day, so you hold 1.5 million or more for launch day, so that you can report record numbers and make the stock price go way up, not to mention all the hype of people waiting in line and smiling for the news cameras on their way out of the store with their shiny new phone.

So, where does that leave you? After you get through the allotted 600,000 phones you set aside, you have to push the ship date on pre-orders back. But not just a few days, you have to push it back far enough that the manufacturing plants have time to recover from the 1.5 million phones and have a new shipment coming in, which is about a week or two later.

All of this to say that I think there be a lot of demand, but also a lot of supply on launch day.

Are you sure they don't count pre orders as launch day sales.

 

[Vertigo50]

I agree with your premise but not your conclusion. I think Apple and AT&T have enough phones to meet the preorders and their moving the date back was to surpress demand long enough to get caught up. But they will raid the non-reserved stock to make up any differences. Generally, if Apple ships 2,000 phones to store A and they have 1500 preorders, then store A gets 500 to sell. If store B has 1800 preorders, then they only get 200 phones to sell. But Apple may take the 700 extras from the two stores and use those to fulfill online preorders. I belive waiting in line without a reservation will result in disappointment. Apple and AT&T will always ship to those that have preordered first, then put what is left out for sale.

My WAG, anyway.

I don't think they will take retail store stock to fulfill online pre-orders. That is why they pushed the dates back. If they were going to do that, they wouldn't have pushed back the dates.

I think they plan for a certain number of phones at each retail store, and they don't mess with that. They want to have a big launch.

 

[Vertigo50]

Are you sure they don't count pre orders as launch day sales.

I'm not sure, but the fact that they are reporting the numbers now makes it seem unlikely that they'll include the 600,000 in their numbers for the first weekend.

It's possible, though, I am only speculating.

 

[HarrisonB]

I don't think they will take retail store stock to fulfill online pre-orders. That is why they pushed the dates back. If they were going to do that, they wouldn't have pushed back the dates.

I think they plan for a certain number of phones at each retail store, and they don't mess with that. They want to have a big launch.

How is it not a massive launch if a million people get their phones delivers. Plus all the people that have reservations are going to make the stores packed anyways.

 

[Vertigo50]

How is it not a massive launch if a million people get their phones delivers. Plus all the people that have reservations are going to make the stores packed anyways.

It is still a massive launch, but as someone said above, it's not going to make the news that a bunch of people got their iPhones in the mail today.

What makes the news is the huge line of people that showed up at 5am, and all the people walking out with their new phones. If there aren't any phones in the store, you end up with a publicity nightmare.

Retail stores have become a big part of Apple's overall strategy. They aren't going to mess with that, in my opinion.

 

[HarrisonB]

It is still a massive launch, but as someone said above, it's not going to make the news that a bunch of people got their iPhones in the mail today.

What makes the news is the huge line of people that showed up at 5am, and all the people walking out with their new phones. If there aren't any phones in the store, you end up with a publicity nightmare.

Retail stores have become a big part of Apple's overall strategy. They aren't going to mess with that, in my opinion.

That's where all the reservation people are going to be at 5am. There is really no need for additional people to make the stores crowded. There is just no 5am diehard that didn't reserve

 

[bobsentell]

I don't think they will take retail store stock to fulfill online pre-orders. That is why they pushed the dates back. If they were going to do that, they wouldn't have pushed back the dates.

I think they plan for a certain number of phones at each retail store, and they don't mess with that. They want to have a big launch.

They already have a big launch. But I still think Apple will fulfill preorders and reservations before they put phones in general stock. It's all about money. You give the product to those who have already paid first.

Any plans for extra store stock is always contingent on available supply. And I don't see any. Not with AT&T saying no mas and Apple announcing ship dates of July 14.

 

[BlondeBuddhist]

I can't imagine Apple telling a retailer that they will get them phones to sell on launch, only to pull out and say sorry. Also, I would think that this number would be pre-determined at some point. I think the individual retailer says they don't know how many they aren getting solely on covering their respective pre-orders.

Not sure if anyone is negating this, but this seemed like the thread to post this, rather than cluttering up the board with a new thread.

Blonde Buddhist

 

[bobsentell]

I can't imagine Apple telling a retailer that they will get them phones to sell on launch, only to pull out and say sorry. Also, I would think that this number would be pre-determined at some point. I think the individual retailer says they don't know how many they aren getting solely on covering their respective pre-orders.

Not sure if anyone is negating this, but this seemed like the thread to post this, rather than cluttering up the board with a new thread.

Blonde Buddhist

Oh I agree. The retailers will get their X number of phones. But at the same time, those retailers were basing their preorders on the number of phones they will get. Given that neither Apple or AT&T has shipped phones to their respective stores yet makes me believe those two entities will fulfill their preorders before supplying extra stock to their stores.

One reason Wal-Mart may have never taken preorders is their stock could have been solely based on availability. Best Buy will get their phones, just don't count on any extra beyond that. And the AT&T and Apple stores will get enough to cover their preorders, and then that's it.

 

[HarrisonB]

Thre retailers already have their pre orders in. They buy them from apple. To apple if they sell 100 iphones to a wal mart they already sold those 100 phones. If they have too much stock saved in their own stores those phones are not sold yet.

 

[Vertigo50]

You know, you also have to think about this from the perspective of an Apple store manager.

No matter how much Apple the corporation wants to sell pre-orders and get them shipped out fast, if they don't supply a good amount of phones to each retail store, the stores are going to be pissed.

I don't think Apple would do that to their retail stores. That's why I think the plan has always been to ship a large amount of phones to each retail store for the walk-in lines, no matter how many pre-orders they got.