It has happened twice in as many weeks -- underestimated demand for a product has resulted in "Sold Out" notices being posted everywhere. The first product to suffer this fate was the $35 Raspberry Pi computer. The second was the new $500 iPad.
Only one company has a legitimate excuse for being so wrong.
The Raspberry Pi Foundation, a tiny charitable operation, is in the business of spreading technology, rather than selling it. It had never really launched a product before. The foundation chose two global distributors, Premier Farnell and RS Components, to handle the initial orders. The device sold out within hours. (See: Distributors Sell Out of Raspberry Pi in Hours.)
Apple Inc. (Nasdaq: AAPL) is a $500 billion company in the business of selling technology products. It has been manufacturing and selling devices for more than 25 years. It has a cadre of supply chain experts, planners, operations managers, and sales and marketing gurus. It has released dozens of products over the years. It owns its own set of retail stores and distributes through global outlets such as Best Buy. The new iPad also sold out within hours. (See: Apple Watch: When Failure Equals Success.)
Both companies cited "unprecedented demand" as the reason for their shortfalls. I can see that happening if a company is only a couple of years old, focuses on education, has no experience in the supply chain, and partners with two industrial distributors that don't do a lot of retail business. Even they were caught off guard.
But let's say you are a company whose CEO used to run your supply chain. You have hundreds of suppliers, and there are no widespread product shortages. You have thousands of employees poised to build your products with a moment's notice. And you share forecasting information not only with your upstream suppliers, but also with your downstream partners. Oh, yeah. You also own retail stores, so you have some experience with supply and demand.
And yet you can't predict demand for a product already on its third iteration? Please.
I give Apple credit for releasing product after product that wows the market. I also give it credit for maintaining its quality, premium pricing, and reputation. I live in a capitalist society, so I'm also in favor of Apple making as much money as it can. But underestimating a forecast? Again? You've got to be kidding.
Wondering about the device using board of ARM11 costing at that low price:
1 - It has SoC a Broadcom BCM2835 : with an ARM1176JZFS; floating point, running at 700Mhz, and a Videocore 4 GPU. The GPU is capable of BluRay quality playback, using H.264 at 40MBits/s.
2 - A fast 3D core with OpenGL ES2.0 and OpenVG libraries.
Would that not cause it longer than that? Considering the fact that, RS is being manufactured/assembled in China and then get the product CE compliant in Europe.
With the latest hit on CE label, it's gonna be delayed till August. This is quite unexpected though as the board is not supposed to be a finished product.
Apple shortage of its products is indeed deliberate, so they did when they released iPad2, I never expect any shortage of their new release base on the past supply experience but they did it again.
Wale@ good point. With so much demand, it would make sense to raise the price. The reason I don't think this will happen is the developer of the Pi is a nonprofit organization that wants users to adopt technology. They may only be charging what they are now to cover the manufacturing and shipping costs. But it will be worth seeing a month from now if the price does go up.
I agree with you t.alex. I bet you in the next few months electronics consumers may not able to grab Rasperry Pi for the initial price the designer announced.
"But underestimating a forecast? Again? You've got to be kidding."
As any other human endeavour, Apple has its limits and cannot obviousely suceed in every aspect of the business. I would even say that it is also good for the brand to be making people longing for their products the way it is happening. This is rather a success than a failure as they don't have immediat competitors to whom their unsatisfied customers can turn to.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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