What's wrong with this year's supply?

[techiebug]

This is the first year i didn't get the phone on the launch date (pre ordered within the first 5 mins). The Jet Black 7+ may be in short supply but Now all models (even the less popular silver 4.7 iphone 7) on Apple.com take at least 2 weeks to ship. This has never happened before. The regular 4.7 iphone was never sold out in the past. Also this year you have to reserve to buy in store (at least at my local store in socal, not sure about anywhere else). What's going on here?? I refuse to believe this thing is sold out like hot cake. This year it's rather an uninteresting upgrade.

 

[jk4lebron23]

They usually have two weeks between preorders and launch and this year they only had one week, they also apparently started production late because of some issues so that put them behind as well
[doublepost=1474275971][/doublepost]

This is the first year i didn't get the phone on the launch date (pre ordered within the first 5 mins). Now all models (even the less popular silver) on Apple.com take at least 2 weeks to ship. This has never happened before. Also this year you have to reserve to buy in store (at least at my local store in socal, not sure about anywhere else). What's going on here?? I refuse to believe this thing is sold out like hot cake. This year it's rather an uninteresting upgrade.

 

[nostodnayr]

What's going on here?

First of all, there may not be enough machines producing the new finishes. A new process will require new machines and they've probably not been working very long so as to keep the finishes secret. It could be further complicated by any errors that may be encountered during manufacturing.

Another reason for the 7 Plus being delayed is that, I've heard (sorry, I can't recall the sources) that the new camera is in short supply, holding up the Plus production rate.

 

[Hanzu Lao]

The only one i could get by 28/09 is the gold one. Others are 3-4 and plus models 4-6 weeks to wait. So i decided to just wait.

 

[techiebug]

First of all, there may not be enough machines producing the new finishes. A new process will require new machines and they've probably not been working very long so as to keep the finishes secret. It could be further complicated by any errors that may be encountered during manufacturing.

Another reason for the 7 Plus being delayed is that, I've heard (sorry, I can't recall the sources) that the new camera is in short supply, holding up the Plus production rate.

New camera and new finish are understandable for the Jet Black 7+. However, all models including silver, gold, etc iphone 7 also take 2 weeks to ship. These were never sold out in the past.

 

[nostodnayr]

New camera and new finish are understandable for the Jet Black 7+. However, all models including silver, gold, etc iphone 7 also take 2 weeks to ship. These were never sold out in the past.

Fair point. It could be as jk4lebron23 said, there was simply not enough lead time.

edit: Oh, and I believe they included more countries in first-day launch this year.

 

[The Game 161]

Apple simply underrated demand.

 

[jk4lebron23]

Fair point. It could be as jk4lebron23 said, there was simply not enough lead time.

edit: Oh, and I believe they included more countries in first-day launch this year.

Yeah they went world wide at once basically where they usually only start with a handful of countries

 

[CEmajr]

This is the first year i didn't get the phone on the launch date (pre ordered within the first 5 mins). The Jet Black 7+ may be in short supply but Now all models (even the less popular silver) on Apple.com take at least 2 weeks to ship. This has never happened before. Also this year you have to reserve to buy in store (at least at my local store in socal, not sure about anywhere else). What's going on here?? I refuse to believe this thing is sold out like hot cake. This year it's rather an uninteresting upgrade.

It may be uninteresting to some of us hardcore followers of the products here on MacRumors but those large amounts of 6/6+ owners in the general population probably find it very exciting.

This isn't unusual though. It happens with pretty much every non "S" version launch. It took quite a while for many people to get their 6 Plus back in 2014.

 

[Shikaka]

Personally I think supply was intentionally limited. Apple is milking the 6/6s/7 form factor for a third year. To prevent consumers from losing interest in the product, Apple creates a false "sell out" to increase demand. Apple will slowly release more stock hoping that people who might have been on the fence about upgrading will jump to pick up a "hard to get" iPhone 7.

 

[Steve121178]

Apple simply underrated demand.

In my opinion they have purposely constrained shipments. Apple knows they will not get the record numbers this time around and it's all designed to not look bad to investors. Apple won't even be releasing the sales numbers - that says it all!

Next year practically everyone on 2 year contracts who had a 6s or older will be due an upgrade. Apple will deliver an all-new iPhone to ensure those customers tie themselves to Apple for another period. Guaranteed.

 

[hellopupy]

I refuse to believe this thing is sold out like hot cake. This year it's rather an uninteresting upgrade.

Just the opposite.

T-Mobile's CEO confirmed last week that pre-orders for the iPhone 7 quadrupled the iPhone 6, which is an amazing number.

 

[ct2k7]

What I'd like to see is the net numbers: sold - returned.

There are many scalpers and people buying to see the differences (because Apple for some reason is not able to have them in stores for viewing and deciding, relating to tight timeline?)

The short time between release and announcement indicates to me the need to drum up demand.

 

[aristobrat]

I refuse to believe this thing is sold out like hot cake. This year it's rather an uninteresting upgrade.

With most of the major carriers virtually giving them away for free (a $650 credit if you trade in an iPhone 6 or newer), that alone is probably generating a lot of interest that wouldn't otherwise be there.

And Samsung not having replacement Note 7s ready to go is probably driving a little more interest in the iPhone 7 Plus than normal too, IMO.

Here are the front pages of the Big Four:

 

[recoil80]

More countries at day one

 

[Cogsworth]

I keep hearing people say Apple does this intentionally to "generate hype" or "inflate demand" and personally I think that's ridiculous. There is already enough hype and excitement around every new iPhone release, they don't need to artificially create any. It also has nothing to do with how it looks to the stockholders. Think about it, what looks better to the stockholders...selling a bazillion units to anyone who walks into a store, or turning people away without a sale?

It makes no business sense to intentionally limit supply and lose thousands of sales within the first days or weeks after a product launch and it's absurd that Apple still hasn't figured this out.

Some say Apple underestimated demand for the new phone. Really? How many times has Apple launched a new iPhone now? Don't you think Apple has a legion of marketing and research people whose job it is to know exactly what demand is going to be? It's silly to think that they could possibly underestimate demand.

Personally I suspect there have been production issues with certain models which of course Apple won't admit. They may have rushed the announcement before they could produce enough inventory. Who knows but they should have made it clear that not all colors or models would be available at launch.

It is very frustrating to me because it seems like this happens every year. Apple has been doing this a long time and they should know what the demand is, and they should know that new colors are always popular. At this point anyone should be able to walk into a store and buy whatever model they want on launch day. No one should have to get up at three in the morning to pre-order a phone or camp out in front of a store all night anymore.

 

[techiebug]

Personally I think Apple is experimenting with this year's release. They're tightening supply, fixing up the ordering process (no more walking in and buy, need reservation). Next year it'll be huge so they're actually preparing for that.

 

[Newjackboy]

What I'd like to see is the net numbers: sold - returned.

There are many scalpers and people buying to see the differences (because Apple for some reason is not able to have them in stores for viewing and deciding, relating to tight timeline?)

The short time between release and announcement indicates to me the need to drum up demand.

Yeah, of course some people are doing that - but on apple scale it's negligible. Less than 1 percent
[doublepost=1474299825][/doublepost]

I keep hearing people say Apple does this intentionally to "generate hype" or "inflate demand" and personally I think that's ridiculous. There is already enough hype and excitement around every new iPhone release, they don't need to artificially create any. It also has nothing to do with how it looks to the stockholders. Think about it, what looks better to the stockholders...selling a bazillion units to anyone who walks into a store, or turning people away without a sale?

It makes no business sense to intentionally limit supply and lose thousands of sales within the first days or weeks after a product launch and it's absurd that Apple still hasn't figured this out.

As usual the answer is always in the middle. Do apple keep stock locked up in a warehouse to generate hype? No, of course not

Are they fully aware they can't meet early demand - yes.

Are they clear and open about it- no!

 

[MrBukey]

Apple haven't artificially or purposefully constrained anything.

- Market analysts said that this was going to be an unexciting launch, and demand would be lower because of the similar form factor and minor updates. That analysis has obviously been proven very wrong and caught Apple maybe off guard.

- Has the AUP class action threat had an impact on the planned process? Most probably. Has the unexpected demand from those not in the AUP from last time round had a further-impact? Most probably.

- With the new finishes, and the need to switch to separated LTE/tech band modems there are now 120 "variations" of iPhone 7 (2 sizes in 5 colours and 3 storage options across 4 modem versions) - that's a lot of variations. Practically all of these bullet points are compounded by the number of variations.

- Launching in more markets on day 1.

- Anything manufactured up to pre-orders is just an educated guess, so they can't guarantee exactly which variations of phone people will want and could take up warehouse space and shipping space on the wrong models, compounded by the number of versions.

- It appears that there was a later start on manufacturing, for whatever reason.

- There was only a week between launch and pre-orders, and between pre-orders and shipping. Downside is the amount stockpiled in these timeframes, upside is that they can switch to manufacturing what people actually want sooner (so not just stockpiling on educated guesses which could be wrong).

- Apple need to create a sustainable supply chain otherwise the process - from both a logistics and cost perspective - just wouldn't be possible (especially with so many variations). All of the above points fall into this, but there's more to it than that too (raw materials, warehouse space for them, manufacturing time for different sizes, warehouse space for finished products, international shipping capacity, different domestic markets shipping capacities, carrier/retailer warehouse space, last leg courier capacity, etc).

- Is there the potential that carriers and retailers might "order" more stock, and start taking orders on the order before getting confirmation of what they'll receive, and then have to let people down? I'll let you make up your own mind but I don't think it's beyond the realms of possibilities at all!?

The past two years haven't been much different. I didn't get my 6 Plus until 19 October, and I didn't get my 6S Plus until 11 October.... At the moment my 7 Plus is looking at 3rd October or sooner...

 

[Shanghaichica]

New camera and new finish are understandable for the Jet Black 7+. However, all models including silver, gold, etc iphone 7 also take 2 weeks to ship. These were never sold out in the past.

There is more demand for the plus model this year. At least at the pre-order stage the plus has outsold the 4.7 inch model. I think Apple underestimated the demand for the bigger model this year.

 

[mtneer]

I think its just the luck of the draw. I had an order 3 minutes after the deadline last year for the 6S+ and I was given a delivery date 2 weeks post launch. And that was with the "S" model which had muted demand. I got my 6+ on launch day, even though the 6 series was a blockbuster for Apple.

 

[Mlrollin91]

They usually have two weeks between preorders and launch and this year they only had one week, they also apparently started production late because of some issues so that put them behind as well
[doublepost=1474275971][/doublepost]

Not true. Its normally 9-10 days, just like this year. Last year was the only the second year that was a 2+ week gap.

iPhone 6 Event 9/9. Launch 9/19
iPhone 5s Event 9/10. Launch 9/20
iPhone 5 Event 9/12. Launch 9/21
iPhone 4s Event 10/4. Launch 10/14

Last time it was more than 10 days was iPhone 4, Event 6/7, launch 6/24.

OP - Even though its a similar body style, the entire body is still different. Every single time there is a body style change, supply is always shorter. the 's' models use the same frame so those already made and they just need to fill the internals. The new body requires new internals and a new body, increasing the time it takes to manufacture.

 

[MrBukey]

Not true. Its normally 9-10 days, just like this year. Last year was the only the second year that was a 2+ week gap.

iPhone 6 Event 9/9. Launch 9/19
iPhone 5s Event 9/10. Launch 9/20
iPhone 5 Event 9/12. Launch 9/21
iPhone 4s Event 10/4. Launch 10/14

Last time it was more than 10 days was iPhone 4, Event 6/7, launch 6/24.

OP - Even though its a similar body style, the entire body is still different. Every single time there is a body style change, supply is always shorter. the 's' models use the same frame so those already made and they just need to fill the internals. The new body requires new internals and a new body, increasing the time it takes to manufacture.

But also less variations, and less launch countries so less complexity (all info at launch of each model):

iPhone 4s: 1 size, 2 colours, 3 storage variations, 2 modem types = 12 variations for 7 countries.
iPhone 5: 1 size, 2 colours, 3 storage variations, 2 modem types = 12 variations for 9 countries.
iPhone 5S: 1 size, 2 colours, 3 storage variations, 4 modem types = 24 variations for 10 countries.
iPhone 6: 2 sizes, 2 colours, 3 storage variations, 3 modem types = 36 variations for 10 countries.
iPhone 6s: 2 sizes, 4 colours, 3 storage variations, 4 modem types = 96 variations for 12 countries.
iPhone 7: 2 sizes, 5 colours, 3 storage variations, 4 modem types = 120 variations for 25 countries.

So less different types of raw materials, less storage space per specific same variation raw materials (or more storage space for same variation raw materials), more capacity for manufacturing same variations, more storage space for completed same variations, more capacity for all forms of shipping of same variations, more capacity for all retail and carrier storage for same variations.....

9 - 10 days is still also considerably less than 14 days in the scheme of things - and then you have launch to pre-order and pre-order to release....

 

[Mlrollin91]

9 - 10 days is still also considerably more than 7 days (almost half again on top) - and then you have launch to pre-order and pre-order to release....

Not sure what this has to do with my post. I was only correcting the person I quoted because they said its usually a 2 week gap and its not.

 

[KPOM]

I think Apple genuinely underestimated demand this year. Consider that all 4 major US carriers had trade-in offers. Since Apple knew a thorough redesign was taking longer than initially planned and that they would be carrying forward the same basic design, I'm guessing that they initially placed a smaller order and set expectations accordingly.

But considering that a lot of iPhone 6 contracts are now ending (which, in retrospect, Apple should have predicted), and the Note 7 fiasco (which Apple could not have predicted), they got an unexpected sales boost.