The narrative has since mutated to "why can't they be like Apple?!1"
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Due to demand, Nintendo used unusual and costly air freight to ship Switches faster
- Thread starter Cerium
- Start date
nextgeneration
Member
Damn impressive Nintendo is going to these lengths to get these to consumers. April numbers are going to be mighty interesting.
They need the early proliferation. Think of it more an investment for the future in a sort of critical time.
CosmicQueso
Member
nevermind
It's simple economies of scale. Greater production = buying and manufacturing and shipping in bulk = lower cost per unit. Their accountants must be shaking their head at these unnecessary costs.
If I'm the first person to think of this then yeah, maybe they should hire me.
Spyder_Monkey
Banned
So either do it and complain about "unnecessary costs" or not do it and complain about "artificial scarcity." Also both your posts are bullshit.
primasaurus
Member
Literally flying off the shelves
D
Deleted member 125677
Unconfirmed Member
Read the title
Read the story
Ceck if the words you're about to post have anything to do with it
Read the story
Ceck if the words you're about to post have anything to do with it
EatinOlives
Member
They did, but they were completely caught off guard at the magnitude at which it took off.
I'm honestly surprised myself; March isn't exactly the time for people to drop hundreds of dollars into a shiny new tech toy, Zelda is really far from the "Wii Sports" type of game that has universal appeal, and at launch there wasn't anything other than 1-2-Switch (which afaik didn't set the world on fire). But they caught lightning in a bottle once again, and it looks like they're taking every measure possible to not leave money on the table. The last restock lasted several hours and it seems like they injected an enormous stock.
Interficium
Banned
I'm shocked your phone isn't ringing off the hook from the major consumer electronics manufacturers! Your perfect 20/20 hindsight would be a real asset for those companies!
Hcoregamer00
The 'H' stands for hentai.
Not many companies has mastered economies of scale, logistics, and just in time manufacturing process the same way Apple has done, and even they have supply problems if a product gets too popular. Also, they didn't come off their worst selling hardware ever.
It's really apples and oranges (pun kind of intended), but it should be flattering people are even putting Nintendo anywhere near close to the best logistics company in the world.
I bet even now, Nintendo is probably taken aback at Mario Kart 8 sales an it's halo effect on Zelda and Switch sales. They probably planned Mario Kart 8 to be a stopgap measure before Splatoon 2 came out, not to be another cultural phenom in its own right.
Nintendo is obviously using air freight in order throw people off the trail of them creating an artificial scarcity. Wake up, sheeple!
Edit: ok, being serious it's pretty funny that they felt the need to do this at all. Expecting joke images about a Nintendo airdrop or something.
Not Spaceghost
Spaceghost
Lol wait wait
here me out okay
this is a crazy thought but maybe just maybe they didn't think the switch would do so well right off the bat and this is them sacrificing some profit in order to keep momentum going on their newly released hardware?
You have to also keep in mind they're coming off the Wii U and Nintendo even lowered their forecasting and how many they would originally ship out at launch. It exceeded their expectations. I have no doubt plenty are coming by ship, the air travel was likely a single time thing so they could quickly meet additional demand in March.
Retracted.
CaviarMeths
Member
If anything, it's a good sign that the narrative has moved from "let's wait a year to see if this launch is actually successful!" to "they should have manufactured 5 million units for launch!" We've advanced from denial to anger. Can't wait for the bargaining phase.
They most likely just did it for launch. Shipping by air is expensive as shit.
Lmao, this
Smiles and Cries
Member
You have a point, that money has to come from somewhere but I wonder if selling them on time is enough of a trade off.
If they are going to push had all year to reach 10 million shipped. This can't be a 1 time thing. I would like to see if this continues for the next few months.
Yoshimitsu126
Member
They already mentioned they losing roughly 45 dollars per unit shipping them through air. Sure their are discount in shipping in bulk but people tend to under estimates the price if shipping in bulk. It still costs lot of money.
Usually the discount of shipping in bulk is in pennies to 10cents or 20cent per unit for high volume. The main cost will be manufacturing.
I suspect this was a major consideration
Milly Osworth
Member
The problems of success.
always crazy bacon
Banned
Just make more. It's really not that simple when a company is making a product. There will be one component (the screen, the chips) that is a gating item that will dictate how many of that product can be made within a certain time frame.
I honestly think that there will be shortages throughout 2017. There's going to be Switch related violence on Black Friday.
All the different manufacturer and 3rd party have to increase production and hire more people. Logistic and contracts need to be remade and deals redo. Its not that simple. Demand outdid initial forecast. They did really good at incressing shipment and using air to meet demands is costly.
I don't believe they make a whopping x>$45 profit with every unit sold. This is more about meeting demand on short notice, which is something no company in the world wants to do because it is so costly. It just shows that Nintendo, which is a very cost sensitive company, is willing to be flexible for once and meet some of the demand. Even with the additional cost that that brings.
I'd want to see a gif colony drop of Switch units.
While this is true for most high-volume companies, something like this still costs more than their bottom line shipping option, which also enjoys big discounts. For a conservative company like Nintendo, anything above that bottom line is noteworthy and says something about their faith in this platform, imo, especially coming off the Wii U.
CaviarMeths
Member
What do you mean? And what would be your solution to increasing margins?
Hcoregamer00
The 'H' stands for hentai.
Try doing overnight air shipping across the world, be prepared to cry at how expensive even a tiny package will cost.
Considering a buyer is then locked into their ecosystem of games and online, the actual profit per physical hardware unit is never actually that important (although nice to have certainly and shouldn't be taking a loss)
$45 per unit is healthy.
Don't cry for any company ever, unless you're a shareholder or work for that company.
always crazy bacon
Banned
I think that number somebody pulled out their ass "could have cost". Somebody could have just weighed a switch and then looked on the Fedex website for a shipping cost from China to the US and saw $45 as the price.
I've sent bigger items on shipment by air (Ten years ago mind you.) China to US and airfreight was only $10 a unit at the time.
Interficium
Banned
Last gen, when Microsoft first sold the 360, not only were they not making $45, they were selling each unit at a significant (>$100) loss.
Would you say they were idiots as well.
always crazy bacon
Banned
Again, a personal single package does not = a commercial pallet of products at business rates. Nintendo did not even overnight express these, they could have just used a 5 day economy service because they only needed to be faster that the 6 weeks it would have taken a boat.
Last i check was lat year where it was 5 dollars almost 6 dollars per kilo to send or receive from china and that was not expedited or speedy.
Milly Osworth
Member
Nintendo sent 1 Switch to the US like this, just so they could put out this news.
/tinfoil hat
/tinfoil hat
None of those artificial scarcity conspiracy theories are really rooted in anything that makes sense anyway. So this won't stop it. Nor will the NES classic being EOL'd.