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This post on the forums [0] is the best answer I've read yet. They sell the Pi Zero (W) at such a low price to promote the platform for educational and non-com

by sswu 8y ago

This post on the forums [0] is the best answer I've read yet. They sell the Pi Zero (W) at such a low price to promote the platform for educational and non-commercial purposes. However, the margins are so low at that price that they cannot afford to sell in bulk. They apparently do offer bulk buys (>500 [1]) at higher prices. The few options to buy multiple are to buy kits (which basically pass that bulk pricing in the form of overpriced accessories), or at a higher price (e.g. I see $22 on Amazon), or be very patient and keep ordering. [0] https://www.raspberrypi.org/forums/viewtopic.php?t=198705#p1240455 https://www.raspberrypi.org/forums/viewtopic.php?t=198705#p1... [1] https://www.raspberrypi.org/forums/viewtopic.php?t=201916#p1255942 https://www.raspberrypi.org/forums/viewtopic.php?t=201916#p1...

jldugger 8y ago
> However, the margins are so low at that price that they cannot afford to sell in bulk Typically, ordering in bulk is how you _support_ low margins, by amortizing all the various fixed overheads. What I suspect you mean is 'the margins are negative, and we're hoping to make it up via attach rate.'
- simonh 8y ago
  I don't think they're planning to make it up at all. I think the point is to make the entry price for beginners and people on low income as affordable as possible. I think people here complaining they can't order them in bulk at $5 or assuming there's some clever business scheme behind it all are kind of missing the point. BTW has anyone here found the 'introduction video' Techcrunch mentions in the article, that they say makes such a good case for the store? The only one I can find is the music video one that really doesn't make a case for anything. Unless that's the one they mean? Confused.
- fnord123 8y ago
  I think they misspoke. I think they didn't mean bulk but really "retail" or "commercially". i.e. small number of units to large number of customers vs. large number of units to small number of customers.
- oliwarner 8y ago
  Indeed. It's a loss-leader. The aim is to pull in real people with single sales, both to grow their community and support further sales down the line of more powerful hardware. Bulk selling these to industry for [near]-disposable application doesn't help the organisation or its aims. It also forces them up another rung of production capacity and warehousing, which is a serious expense.
adrianN 8y ago
If they can't afford to sell in bulk, the margins are actually negative.
- mobilemidget 8y ago
  Does anybody know how negative? personally would have rather seen them priced at a value it could be bulk ordered. As many others pointed out, they are neat to build multi node projects or prototypes of doodles with.
alias_neo 8y ago
Although this may work in general, it hurts the very purpose of the Pi. I have an open source project I've been working on for some time, it's based around the Pi Zero W, however, here in the UK it's practically impossible to get more than one Zero W unless you order individually from each site and pay shipping individually for each. Even then, you'll be paying at least £12+shipping per unit. It's wasteful and needless to do all this individual shipping. Is not just a case of buying individually until I can get all the Pis I need, because once I release, if users have the same issues getting the hardware, the project is pointless. For now the project is sitting on a shelf until I find an alternative platform or Pi stops this 1 unit per customer "shortage".
- richardwhiuk 8y ago
  The purpose of the Pi is to get kids a computer they can play with. I struggle to see how your inability to buy lots of Pis disagrees with that.
  - vageli 8y ago
    > The purpose of the Pi is to get kids a computer they can play with. Where did you get that idea? From the raspberry pi website: > Our mission is to put the power of computing and digital making into the hands of people all over the world.
    - kingosticks 8y ago
      Yes, that is their tagline. Take a look at their strategy document[0] if you want to understand why the parent's interpretation is more accurate. [0]: https://static.raspberrypi.org/files/about/RaspberryPiFoundationStrategy2018%E2%80%932020.pdf https://static.raspberrypi.org/files/about/RaspberryPiFounda...
- semi-extrinsic 8y ago
  Just curious: what is the use case where the Pi Zero W is better than, say, an ESP8266 as in the Wemos/Lolin D1 mini board? Those you can actually buy in bulk for $4. From my point of view, the fragility of having to deal with a microSD card makes a Pi-like solution a complete non-starter if you want to scale.
benj111 8y ago
So assuming they are selling the zero at cost or a loss, why? This thread just shows how confusing the situation is, and it isn't even clear to me that it helps in promoting the education side, further it damages the brand and puts people off buying. Why not have a school and student channel, so that they can buy at $5. And then sell it at a higher cost retail? Everyone knows where they stand, schools can bulk buy $5 zeros, which presumably they can't now. The current system just seems to be a mess.
gmiller123456 8y ago
Actually, the better answer is the part of your [0] reference that you didn't copy: "* In effect, since the Zero(W) would cannibalise sales from the other models, we lose the profit margin we would make on the P3. Cannot afford to do that in quantity." Or, more specifically, their intent is to undercut any manufacturer that would want to make a very low cost board at a sustainable profit margin to prevent one from taking hold. You can buy as many Orange Pi Zero's (with WiFi) as you want, any day of the year for $12.76 (the price goes even down slightly if you buy more than one) [1]. [0] https://www.raspberrypi.org/forums/viewtopic.php?t=198705#p1240455 https://www.raspberrypi.org/forums/viewtopic.php?t=198705#p1... [1] https://www.aliexpress.com/store/product/New-Orange-Pi-Zero-H2-Quad-Core-Open-source-development-board-beyond-Raspberry-Pi/1553371_32760774493.html https://www.aliexpress.com/store/product/New-Orange-Pi-Zero-...

by sswu 8y ago

jldugger 8y ago

> However, the margins are so low at that price that they cannot afford to sell in bulk Typically, ordering in bulk is how you _support_ low margins, by amortizing all the various fixed overheads. What I suspect you mean is 'the margins are negative, and we're hoping to make it up via attach rate.'

simonh 8y ago
I don't think they're planning to make it up at all. I think the point is to make the entry price for beginners and people on low income as affordable as possible. I think people here complaining they can't order them in bulk at $5 or assuming there's some clever business scheme behind it all are kind of missing the point. BTW has anyone here found the 'introduction video' Techcrunch mentions in the article, that they say makes such a good case for the store? The only one I can find is the music video one that really doesn't make a case for anything. Unless that's the one they mean? Confused.
fnord123 8y ago
I think they misspoke. I think they didn't mean bulk but really "retail" or "commercially". i.e. small number of units to large number of customers vs. large number of units to small number of customers.
oliwarner 8y ago
Indeed. It's a loss-leader. The aim is to pull in real people with single sales, both to grow their community and support further sales down the line of more powerful hardware. Bulk selling these to industry for [near]-disposable application doesn't help the organisation or its aims. It also forces them up another rung of production capacity and warehousing, which is a serious expense.

adrianN 8y ago

If they can't afford to sell in bulk, the margins are actually negative.

mobilemidget 8y ago
Does anybody know how negative? personally would have rather seen them priced at a value it could be bulk ordered. As many others pointed out, they are neat to build multi node projects or prototypes of doodles with.

alias_neo 8y ago

Although this may work in general, it hurts the very purpose of the Pi. I have an open source project I've been working on for some time, it's based around the Pi Zero W, however, here in the UK it's practically impossible to get more than one Zero W unless you order individually from each site and pay shipping individually for each. Even then, you'll be paying at least £12+shipping per unit. It's wasteful and needless to do all this individual shipping. Is not just a case of buying individually until I can get all the Pis I need, because once I release, if users have the same issues getting the hardware, the project is pointless. For now the project is sitting on a shelf until I find an alternative platform or Pi stops this 1 unit per customer "shortage".

richardwhiuk 8y ago
The purpose of the Pi is to get kids a computer they can play with. I struggle to see how your inability to buy lots of Pis disagrees with that.
- vageli 8y ago
  > The purpose of the Pi is to get kids a computer they can play with. Where did you get that idea? From the raspberry pi website: > Our mission is to put the power of computing and digital making into the hands of people all over the world.
  - kingosticks 8y ago
    Yes, that is their tagline. Take a look at their strategy document[0] if you want to understand why the parent's interpretation is more accurate. [0]: https://static.raspberrypi.org/files/about/RaspberryPiFoundationStrategy2018%E2%80%932020.pdf https://static.raspberrypi.org/files/about/RaspberryPiFounda...
semi-extrinsic 8y ago
Just curious: what is the use case where the Pi Zero W is better than, say, an ESP8266 as in the Wemos/Lolin D1 mini board? Those you can actually buy in bulk for $4. From my point of view, the fragility of having to deal with a microSD card makes a Pi-like solution a complete non-starter if you want to scale.

benj111 8y ago

So assuming they are selling the zero at cost or a loss, why? This thread just shows how confusing the situation is, and it isn't even clear to me that it helps in promoting the education side, further it damages the brand and puts people off buying. Why not have a school and student channel, so that they can buy at $5. And then sell it at a higher cost retail? Everyone knows where they stand, schools can bulk buy $5 zeros, which presumably they can't now. The current system just seems to be a mess.

gmiller123456 8y ago

Actually, the better answer is the part of your [0] reference that you didn't copy: "* In effect, since the Zero(W) would cannibalise sales from the other models, we lose the profit margin we would make on the P3. Cannot afford to do that in quantity." Or, more specifically, their intent is to undercut any manufacturer that would want to make a very low cost board at a sustainable profit margin to prevent one from taking hold. You can buy as many Orange Pi Zero's (with WiFi) as you want, any day of the year for $12.76 (the price goes even down slightly if you buy more than one) [1]. [0] https://www.raspberrypi.org/forums/viewtopic.php?t=198705#p1240455 https://www.raspberrypi.org/forums/viewtopic.php?t=198705#p1... [1] https://www.aliexpress.com/store/product/New-Orange-Pi-Zero-H2-Quad-Core-Open-source-development-board-beyond-Raspberry-Pi/1553371_32760774493.html https://www.aliexpress.com/store/product/New-Orange-Pi-Zero-...