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  • Apple's Supply Chain and Chinese Customs Taxes Killing iPad Reselling Market

    Picture of an iPad reseller in Hong Kong during the iPad 2 launch. Prices for the 16GB Wi-Fi model reached $1025, while the 64GB 3G reached prices as high as $1525 in resale markets.


    Turns out the Apple iDevice resale market is drying up.

    The hustle is simple. Resellers buy as many iDevices as they can on launch day in an attempt to capitalize on the high demand and low supply of the products. However, this time around the resellers didnít get help from Apple, as Cupertino met and exceeded consumer demand for the devices.

    Reports have surfaced of some resellers returning as many as 30 new iPads at a time to Apple stores. Making matters worse for the resellers and better for everyone else, China is starting to crack down incoming iPad shipments. According to Reuters Chinese custom authorities have added the iPad to a list of taxable items entering China.

    An electronics dealer in Oakland, California, said he struggled to break even this year, a far cry from previous iPad releases when he shipped upwards of 1,000 tablets and pocketed profits of $50 to $100 per device sent to his buyer in Hong Kong.

    Also, Apple appears to have pulled the incredible feat of launching in simultaneously in 10 countries and meeting demand in every single one. The iPad 2 launch by comparison was rife with delays and supply shortages making for a reseller paradise. High supply in the U.S. and other countries, coupled with new Chinese tax policies have all, but dried up the iDevice black market.

    Source: Reuters [via MacRumors]
    This article was originally published in forum thread: Apple's Supply Chain and Chinese Customs Taxes Killing iPad Reselling Market started by Phillip Swanson View original post
    Comments 13 Comments
    1. unison999's Avatar
      unison999 -
      Apple new iPad supply already caught up with only 1 week of introduction, it is only logical same thing happening every where else. Supply > demand = bad news for Retail Hustlers.
    1. Amadomon's Avatar
      Amadomon -
      Quote Originally Posted by unison999 View Post
      Apple new iPad supply already caught up with only 1 week of introduction, it is only logical same thing happening every where else. Supply > demand = bad news for Retail Hustlers.
      ...and good news for everyone else; ie, the consumer. Scarcity premiums are what is known as "economic rents", and they do nothing to add to the social welfare.
    1. Jahooba's Avatar
      Jahooba -
      Awesome news. Take that you jerks.
    1. sziklassy's Avatar
      sziklassy -
      Quote Originally Posted by unison999 View Post
      Apple new iPad supply already caught up with only 1 week of introduction, it is only logical same thing happening every where else. Supply > demand = bad news for Retail Hustlers.
      Thanks for summing up the article for those who can't read.
    1. CCNPJediHacker's Avatar
      CCNPJediHacker -
      Quote Originally Posted by sziklassy View Post
      Thanks for summing up the article for those who can't read.
      Thanks for being an A**
    1. therandy's Avatar
      therandy -
      It will happen again, its just that this iPad wasn't anything to write home about. Since 07 I have always had a new iDevice on launch day. But this iPad didn't excite me like its predecessors. When apple wow's us with more than just a new processor, screen, and network chip...the high demand will be back and these scum bags will be back to making crazy money.
    1. deltabell's Avatar
      deltabell -
      Quote Originally Posted by therandy View Post
      It will happen again, its just that this iPad wasn't anything to write home about. Since 07 I have always had a new iDevice on launch day. But this iPad didn't excite me like its predecessors. When apple wow's us with more than just a new processor, screen, and network chip...the high demand will be back and these scum bags will be back to making crazy money.
      and what was so special about upgrading from the ipad to ipad 2?
    1. rkswat's Avatar
      rkswat -
      Quote Originally Posted by therandy View Post
      It will happen again, its just that this iPad wasn't anything to write home about. Since 07 I have always had a new iDevice on launch day. But this iPad didn't excite me like its predecessors. When apple wow's us with more than just a new processor, screen, and network chip...the high demand will be back and these scum bags will be back to making crazy money.
      Guess the record breaking sales (3 million) tells us all you're a nimrod with no clue. Just a thought, maybe the supply was enough to keep up with demand and THAT'S why the scalpers got f-ed. I may be wrong
    1. The6uest's Avatar
      The6uest -
      There are more iPads available this time but I still can't find a dang 32gb wifi-only model! Everyone only has the 16 and 64gb models. I guess if I went to an Apple store they would have one, but I don't feel like driving that far especially when I have Walmart and Best Buy gift cards I can use..
    1. manickbarry's Avatar
      manickbarry -
      Quote Originally Posted by deltabell View Post
      and what was so special about upgrading from the ipad to ipad 2?
      My thought exactly I still have iPad 1 the 2 was nothing special but I think this new one is a bigger leap from the 2
    1. unison999's Avatar
      unison999 -
      Quote Originally Posted by sziklassy View Post
      Thanks for summing up the article for those who can't read.
      Thanks for not noticing the what I really wanted to say, Apple's 3 million sales figure though looks big it is due to wider release to more countries. If you look just at U.S. figures I believe it would be less than iPad 2. My reasoning for this is due to how quickly the new iPad supply caught up to the demand, that is why I believe new iPad may not be as popular as people make it out to be.

      Quote Originally Posted by rkswat View Post
      Guess the record breaking sales (3 million) tells us all you're a nimrod with no clue. Just a thought, maybe the supply was enough to keep up with demand and THAT'S why the scalpers got f-ed. I may be wrong

      No, because the new iPad released into more countries along with U.S.
      Apple do this to obscure the sales figures, this may create artificial demand.
      With more countries that means wider market of course that would mean there would be more sales at launch, but if you only take U.S. sales for iPad 2 compare with new iPad that may give you different figures.
      My guess the sales figures in U.S. alone is down, due to the fact that Apple iPad ship time is back to 1~2 weeks. Supply already caught up to demand within 1 week, compare to iPad 2 takes over a month for supply to catch up (if I remember correctly).
    1. RoloDiva13's Avatar
      RoloDiva13 -
      Quote Originally Posted by unison999 View Post
      Thanks for not noticing the what I really wanted to say, Apple's 3 million sales figure though looks big it is due to wider release to more countries. If you look just at U.S. figures I believe it would be less than iPad 2. My reasoning for this is due to how quickly the new iPad supply caught up to the demand, that is why I believe new iPad may not be as popular as people make it out to be.

      ...because the new iPad released into more countries along with U.S.
      Apple do this to obscure the sales figures, this may create artificial demand.
      With more countries that means wider market of course that would mean there would be more sales at launch, but if you only take U.S. sales for iPad 2 compare with new iPad that may give you different figures.
      My guess the sales figures in U.S. alone is down, due to the fact that Apple iPad ship time is back to 1~2 weeks. Supply already caught up to demand within 1 week, compare to iPad 2 takes over a month for supply to catch up (if I remember correctly).
      I see what you're getting at, but why wouldn't they include all launch countries? To only count U.S. sales seems idiotic when the device was available in nine other nations the same day. Better yet, think about it this way: When we talk about a movie like The Dark Knight breaking the $1B mark, that is worldwide ticket sales, not U.S. only, but how many people really qualify that statement? (A: hardly any)
    1. szr's Avatar
      szr -
      Quote Originally Posted by RoloDiva13 View Post
      I see what you're getting at, but why wouldn't they include all launch countries? To only count U.S. sales seems idiotic when the device was available in nine other nations the same day. Better yet, think about it this way: When we talk about a movie like The Dark Knight breaking the $1B mark, that is worldwide ticket sales, not U.S. only, but how many people really qualify that statement? (A: hardly any)
      Keep in mind, that movies do not always get released at the same time in every country. Sometimes movies get released in the U. S. first and other countries a a week, month, or whatever after. Sometimes other countries will get a movie before others (I believe it depends on where the movie is from and/or the distributors.) Therefore, when it broke a particular sale mark can be an important factor. If movie FOO was released in the U. S. one week before other countries, and it broke a record on just that first weekend, then the sales in other release markets becomes less significant to that statistic. Similarly, if bombed in the initial market but did well overall in other countries (when all markets are added together), then, that could make it appear that the film is better that it actually was.