The last word on those reports of iPhone 5C supply chain cuts

Posted in iPhone News by admin. Published October 22nd, 2013

The last word on those reports of iPhone 5C supply chain cuts

Apple trimmed iPhone 5C orders 50%. Or was it 20%? Or 35%?

I knew there was a reason I didn’t comment on the several reports of iPhone  production order changes — up and down — that came across the business wires last week. (See here, here and here.)

But it wasn’t until I read the MacDailyNews’ take on the issue Saturday that I could articulate why.

“We’re going to make this so simple that even a Droid settler might be be able to understand,” it begins.

Without knowing how many units Apple made prior to launch, you cannot infer anything – good or bad – based on limited “channel checks” of production orders at this point. You simply do not have enough data to gauge the success of iPhone 5c – or iPhone 5s for that matter.

The following numbers are made up. The actual numbers do not matter. They are for illustrative purposes only:

If Apple made 8 million 5c units upfront, sold 6 million in the first week, then adjusted future production based on that data and Apple also made 3 million 5s units upfront, but sold 3 million in stores and received 3 million online orders in the first week, then adjusted future production based on that data, which iPhone model sold the most units?

In case you missed the point, the editors go on to quote the world’s foremost expert in the workings of Apple’s (AAPL) supply chain: Tim Cook

I would suggest it’s good to question the accuracy of any kind of rumor about build plans and also stress that even if a particular data point were factual it would be impossible to accurately interpret the data point as to what it meant for our overall business because the supply chain is very complex and we obviously have multiple sources for things, yields might vary, supply performance can vary. The beginning inventory positions can vary, I mean there is just an inordinate long list of things that would make any single data point not a great proxy for what’s going on. – Jan. 23, 2013 conference call.

[Thanks: http://tech.fortune.cnn.com]

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