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The whole point of having so little stockpiled inventory is that if there's a reduction in demand or a new product is released, the minimum amount of money is l
by apike 14y ago
The whole point of having so little stockpiled inventory is that if there's a reduction in demand or a new product is released, the minimum amount of money is lost unloading the excess product.
Back in the day, Apple would always be sitting on 10 weeks of inventory. When a downturn or new product would come out, it would force them to sell the backlog at a loss, which was very painful for them.
- littledreamer 14y agovery true.
- excuse-me 14y agoThere is a flip side to this. An earthquake in Japan has car factories in the USA sitting idle a year later because of a shortage of parts. A fire at a Foxcon factory in the run up to christmas would really hurt Apple.
- arkitaip 14y agoBut would it be worse than having billions in inventory?
- excuse-me 14y agoThey have got billions in inventory, it's just on Foxconn's books rather than Apple's. Having very lean stock levels in a retail business can have drawbacks.
- philwelch 14y agoIn lost revenues, yes. But that just means less profit. Having inventory on hand and having to sell it at a loss or bury it (like the Lisa, for instance) means actually taking a loss.