Best Buy Turning Sleazy With Wii Sales?

[+-^CrossBow^-]

And what would Nintendo have to do to ramp up production exactly? Hire more workers, buy or rent another facility to tool up to fabricate more...etc. Nintendo is now able to make twice as many Wiis as before and therefore double product to meet the demand.

 

Now... 6 months or a year passes and the demand drops back to levels of about 2 or 3 months ago when I and others started to see them on shelves again. And then they continue to keep showing up on shelves..and keep showing up. Why? Because the demamd has dropped and Nintendo doesn't need to crank out so many.

 

Now what does Nintendo do with the facility, equipment, resources, and most importantly...the workers whom were needed for that second facility or whatever they needed to double their output?

 

They have no choice but to logically liquidate that once needed asset and get rid of it. If they didn't they would now be producing and spending MORE than they need to keep up. This equates to lost money and wasted resources...not to mention layoffs for those employees no longer needed. Personally, I wouldn't want to run a business in this manner as it would do nothing but curtail morale. My previous employer worked in this method and I absolute hated it because of the people I would see come one month and gone in a year or two when a contract was dropped that no longer required the employees. Essentially, this is also ultimately why I was laid off...as our business in the Airlines service had dropped 50% of what it was before 9/11. With fewer calls coming into my group, they didn't need all 12 of us and dropped it down to a 6 man team. Senority was used to determine who stayed and went. I wasn't on the top of that senority. But the point remains the same. Any company that produces a product would be best served in the LONG run to keep production where everything balances or turns a profit, even if the demand can't quite be met. Better to not meet demand then to have too much product that then sits and doesn't sell and have to cut back resourses once used.

 

Sorry, but from a long term business stand point, it makes sense that Nintendo isn't increasing their production anymore than they are. May not make the consumers happy, and there is the risk of having those consumers run to another competitor if they can't get what they were looking for. However, given the current sales figures from last month (Wii sales were over 500k again and edged out the DS this time overall), I don't think they are worried about this happening.

[+Random Terrain]

. . . launch Wii . . .

[Albert]

Sorry, but from a long term business stand point, it makes sense that Nintendo isn't increasing their production anymore than they are. May not make the consumers happy, and there is the risk of having those consumers run to another competitor if they can't get what they were looking for. However, given the current sales figures from last month (Wii sales were over 500k again and edged out the DS this time overall), I don't think they are worried about this happening.

Uhh, there are companies that specialize in doing just this sort of thing, such as Foxconn. Nintendo does not need to build or maintain a new factory of their own just to ramp up production.

 

..Al

[HammR25]

The one time I've seen a Wii in the wild I actually saw two of them at the same time in the display case at WalMart around midnight. About 5 minutes later one was gone.

[Atari5200]

And what would Nintendo have to do to ramp up production exactly? Hire more workers, buy or rent another facility to tool up to fabricate more...etc. Nintendo is now able to make twice as many Wiis as before and therefore double product to meet the demand.

 

Now... 6 months or a year passes and the demand drops back to levels of about 2 or 3 months ago when I and others started to see them on shelves again. And then they continue to keep showing up on shelves..and keep showing up. Why? Because the demamd has dropped and Nintendo doesn't need to crank out so many.

 

Now what does Nintendo do with the facility, equipment, resources, and most importantly...the workers whom were needed for that second facility or whatever they needed to double their output?

 

They have no choice but to logically liquidate that once needed asset and get rid of it. If they didn't they would now be producing and spending MORE than they need to keep up. This equates to lost money and wasted resources...not to mention layoffs for those employees no longer needed. Personally, I wouldn't want to run a business in this manner as it would do nothing but curtail morale. My previous employer worked in this method and I absolute hated it because of the people I would see come one month and gone in a year or two when a contract was dropped that no longer required the employees. Essentially, this is also ultimately why I was laid off...as our business in the Airlines service had dropped 50% of what it was before 9/11. With fewer calls coming into my group, they didn't need all 12 of us and dropped it down to a 6 man team. Senority was used to determine who stayed and went. I wasn't on the top of that senority. But the point remains the same. Any company that produces a product would be best served in the LONG run to keep production where everything balances or turns a profit, even if the demand can't quite be met. Better to not meet demand then to have too much product that then sits and doesn't sell and have to cut back resourses once used.

 

Sorry, but from a long term business stand point, it makes sense that Nintendo isn't increasing their production anymore than they are. May not make the consumers happy, and there is the risk of having those consumers run to another competitor if they can't get what they were looking for. However, given the current sales figures from last month (Wii sales were over 500k again and edged out the DS this time overall), I don't think they are worried about this happening.

 

With as large Nintendo should already have multiple production factories, again, the company I work for only makes about 200-300mil a year, and we are able to run 3-4 different factories, we are also able to air freight in product for shortages. There's no reason a year later for there still to be shortages, the manufacturing side of it should have changed by now to meet the demand. You can't tell me that a multi-BILLION dollar company has less resources than a 200million dollar company, sorry, don't believe it.

[Lord Helmet]

They are making 1.8 million of these things a month...and they still can't keep them on the shelves.

 

It may not make business sense to have several factories...what do you do with them once you have met demand? Its tricky getting supply and demand to balance. The fact that they are making a ton of them, and selling every unit is has got to make Nintendo happy. Much better than making them and then having them sit on the shelf.

 

Then again, I don't know all of the specifics because I don't work for Nintendo...I just know a little about basic economics

 

 

If you increase production capacity too much, you are left with ridiculous overhead in the future. There is no reason for Nintendo to make more of these than they are right now. There is no backlash from the market to speak of due to shortage, and every one they make gets sold.

[+-^CrossBow^-]

Lord Helmet knows precisely what I was talking about...

 

Nintendo isn't going to increase the production beyond demand. If they are indeed making about 1.8mil of these things a month then that is already 800k more than they were able to make a year ago.

 

If they produce more then they need it costs them more for the waste in the long run that it does to always be just a tad behind.

 

And, are you going to tell me that Sony and MS can both produce 1.8mil consoles a month? I believe that if the tables were turned and the PS3 or the 360 was suddenly the Hot console...I bet we would still see these shortages. We don't see them currently, becaue neither of those two consoles are selling like the Wii is.

[Albert]

It may not make business sense to have several factories...what do you do with them once you have met demand? Its tricky getting supply and demand to balance. The fact that they are making a ton of them, and selling every unit is has got to make Nintendo happy. Much better than making them and then having them sit on the shelf.

I mentioned this earlier, but maybe you didn't see it. Nintendo could easily contract out production of the consoles to companies like Foxconn. When the extra capacity is no longer needed, Foxconn stops building them and goes on to some other contract and retools the factory to build something else. Nintendo does not need to buy another factory, hire employees and manage it. It's well within Nintendo's power to alleviate this shortage, and has been for some time. Obviously they have no desire to. The main thing that sucks about this is it's going to be hard for parents to find Wii consoles this holiday season, and the only way to get one may be to pay some scalper a ridiculous premium. By not keeping up with demand, Nintendo enables these profiteers to take advantage of the situation. Again, I'm quite curious to see how many end up on eBay very soon now.

 

Geesh, I just took a look at eBay and saw crap like this (look at the picture):

 

eBay Auction -- Item Number: 190175364010

 

..Al

[bdog_147]

That is just wrong...paying over 400 for a system that is worth 250(US)? OUCH! And there are people out there who will actually pay that to get it...sad. Well, if they really want it that badly to pay roughly twice what it's worth there is no stopping them.

[Lord Helmet]

It may not make business sense to have several factories...what do you do with them once you have met demand? Its tricky getting supply and demand to balance. The fact that they are making a ton of them, and selling every unit is has got to make Nintendo happy. Much better than making them and then having them sit on the shelf.

I mentioned this earlier, but maybe you didn't see it. Nintendo could easily contract out production of the consoles to companies like Foxconn. When the extra capacity is no longer needed, Foxconn stops building them and goes on to some other contract and retools the factory to build something else. Nintendo does not need to buy another factory, hire employees and manage it. It's well within Nintendo's power to alleviate this shortage, and has been for some time. Obviously they have no desire to. The main thing that sucks about this is it's going to be hard for parents to find Wii consoles this holiday season, and the only way to get one may be to pay some scalper a ridiculous premium. By not keeping up with demand, Nintendo enables these profiteers to take advantage of the situation. Again, I'm quite curious to see how many end up on eBay very soon now.

 

Geesh, I just took a look at eBay and saw crap like this (look at the picture):

 

eBay Auction -- Item Number: 190175364010

 

..Al

 

 

Yeah, I didn't see that. I suppose they could outsource. Maybe they don't for quality control reasons, or maybe they like the free publicity

[MCHufnagel]

And, are you going to tell me that Sony and MS can both produce 1.8mil consoles a month? I believe that if the tables were turned and the PS3 or the 360 was suddenly the Hot console...I bet we would still see these shortages. We don't see them currently, becaue neither of those two consoles are selling like the Wii is.

I know Sony could probably meet that kind of demand. They did sell over 100 million of both the PSX and PS2. I'm sure in each console's heyday they were making 1.8 million a month or even more.

[+remowilliams]

The main thing that sucks about this is it's going to be hard for parents to find Wii consoles this holiday season, and the only way to get one may be to pay some scalper a ridiculous premium

Oh, it's gonna be ugly. The same lowlifes who have nothing else to do than hang around and repeatedly rape the retail channel supplies are going to be out in full force. A quick look at Amazon "92 used & new from $440.00" What a bargain!

[n8littlefield]

And, are you going to tell me that Sony and MS can both produce 1.8mil consoles a month? I believe that if the tables were turned and the PS3 or the 360 was suddenly the Hot console...I bet we would still see these shortages. We don't see them currently, becaue neither of those two consoles are selling like the Wii is.

I know Sony could probably meet that kind of demand. They did sell over 100 million of both the PSX and PS2. I'm sure in each console's heyday they were making 1.8 million a month or even more.

 

Yes - in their heyday they shipped more but it took awhile. This press release from the 1 year PS2 anniversary says alot...

 

http://ps2.gamezone.com/news/03_23_01_01_36PM.htm

 

It discusses the PS2 hitting 10 million SHIPPED in it's first year - Wii is reporting 13.3 million SOLD (per wiki). The press release refers to beefing up PS2 production the next year to get from 1.5 million/month to 2.0 million/month. So really, really similar in terms of numbers and output.

Edited November 20, 2007 by n8littlefield

[Lauren Tyler]

This so reminds me of a commercial for Rice Krispies Treats, where there's just one treat left in the display box, and some guy picks it up and says, "I got the last treat!" And the cashier says, "Aren't you special!" Then after he leaves, she puts another treat in there.