Is the Photo Equipment Supply Chain Totally Broken?

[uaiomex]

Excellent article about the possible causes of the scarcity. But sooner or later factories will have to crank up production flooding the market with new and old gear. Given that pro gear is becoming more expensive every year, manufacturers and vendors would prefer to invest in pro equipment ONLY WHEN on high demand and in zillions of p&s cameras.
I'm afraid this will become a repetitive cycle from now on. Damn future, it already reached us.
Eduardo

[ErikKaffehr]

Hi,

I guess that there are markets offering better margins than US. I checked my two vendors here in Sweden and one of them has 10 GH2:s in stock. The other seems to have most lenses in stock but no GH2.

Best regards
Erik

[feppe]

I guess that there are markets offering better margins than US. I checked my two vendors here in Sweden and one of them has 10 GH2:s in stock. The other seems to have most lenses in stock but no GH2.

I follow 43rumors.com, and this has been a theme there for a while as well: many of Panasonic's cameras and lenses are hard to find in the US, but are plentiful in many countries in Europe. It's probably partly due to them being able to squeeze higher margins from EU. Other items which might make EU/euro area more attractive is import duties, exchange rates, and how Panasonic, Canon, etc. are doing their hedging. Finally, MFT has apparently been more successful in Europe than in the US which is another factor - capturing European market share might be a strategic decision from Panasonic.

[dave230862]

As an amateur photographer, but an engineer who works in the automotive parts supply chain, I'm afraid to report that the supply situation in Japan is much worse than many think.
My own company (Japanese head office in a major center hundreds of km away from the affected region) has turned to working weekends to offload weekday electricity demand.
A major supplier of capacitors was hit head on by the tsunami and put global automotive production at risk up until just a few weeks ago.
Several chip suppliers are also in the affected region.
There are many companies that are sole sources of high tech materials that were wiped out. Companies that make relatively minor constituents of highly complex chemical processes are gone. Thus the larger process stops.
One of the worlds largest manufacturers of red pigments went down. Paints and inks started to become problematic. I wouldn't be surprised to hear that Toyota and Honda won't be selling cars painted red for some time.

The problems in Japan are to be measured in terms of several months, perhaps a year, before things can return to quasi-normal state.

Anyway, the other points are quite valid, I'm sure. I just think that most folks do not fully appreciate the magnitude (pardon the pun) of the issue remaining in Japan.

[JeffKohn]

I also think the article misplaces the emphasis. Nikon/Canon have always had fairly restrained supply particularly for the pro-level gear, and while that may have extended further down the product line as the economy weakened, the out-of-stock issues have always been short-term/intermittent and very rarely across large segments of the product line simultaneously. It's just common sense that you don't want to have a large excess of inventory when that inventory is so expensive; that's why it's big ticket items such as the super-teles for which you so often see this.

The stock issues now are more severe, and I think it would be hard to argue that the aftermath of the disaster in Japan isn't playing a large role. After all we're not just seeing it in cameras, but automobiles and all sorts of other industries.

As for Leica, not much that they do has ever made sense from a traditional marketing perspective, so I'm not sure they should even be part of the discussion.

[BernardLanguillier]

The stock issues now are more severe, and I think it would be hard to argue that the aftermath of the disaster in Japan isn't playing a large role. After all we're not just seeing it in cameras, but automobiles and all sorts of other industries.

The article does indeed read a bit as if it had been written a few months back with the tsunami impact added as an after thought.

For those interested in a thorough analysis of this question, Thom Hogan has been writing much more in depth about it for some time at www.bythom.com

Cheers,
Bernard

[nad54]

The photo supply chain has been breaking down slowly for years.

The main issue is that dealer margins are so low they can't afford to hold stock and compete with internet wholesalers.

One dealer I know well told me the margins on Nikon equipment. Factoring in credit card fees he makes practically no money. So how can he hold stock when he can make no money. He can only really make money on the diminishing sales of second hand equipment. How many times have people gone into a dealer to look at a camera, handle it and then go and buy it on the internet to save a few pounds/dollars.

Every business has been moving to the 'just in time model' in order to keep costs down.