So the holidays are behind us and if you were left disappointed by what you found under your Christmas tree it might be because you weren’t in the spirit of things, or it might have been because Santa couldn’t get any stock of anything.
The good little consumers of the world might have started to notice an increasingly common trend where more and more products sell out the day they are released, or are never available at all to ordinary consumers.
Everything from playstations, switches, Xboxes and graphics cards, to lego sets, handbags, watches, and even toilet paper, it seems more and more like we are living in a world that is out of stock.
But why?
Stock shortages from time to time happen, that’s just general supply chain management but why has this become such a consistent issue.
All of these products are made by businesses with a profit motive, and those profits don’t get made unless products get sold, so what gives?
Now I know what you might be thinking, “err it’s the virus of course” and certainly this has thrown a spanner into the works of global supply chains but it’s not the whole story.
Limited supply is one thing, but if traditional economics is to be believed, businesses don’t let themselves run out of stock, instead they just raise prices to match demand and maximize their profits.
What’s more, is that the coronavirus is not exactly new news to companies. If they were caught out in early 2020 then fair enough, but almost a year later you would think the corporate executives responsible for multi-billion dollar product launches could account for this new global paradigm, right?
But they haven’t, and you might ask why?
Well to understand this we as always need to look at a few key things.
How have global supply chains been affected, beyond just blaming everything on COVID?
Are the companies involved actually making poor business decisions?
And why aren’t these products just doing what supply and demand would tell them to do and increase in price?
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