Nintendo Switch launch shortages and planning explained

Nintendo Switch Launch Shortages and Planning

Nintendo critics have long suspected the company creates artificial shortages on purpose. Whenever a new console from it releases, “sold out” headlines dominate gaming news. Because media outlets love to write about a sold out product, free advertisement is generated. People buy into the hype, whether it is the Switch or Tickle Me Elmo.

But is the supply shortage real? A common economic principle states that companies should not produce more of a product than the demand. The supply should be equal to or less than the actual demand. Otherwise, the company takes a loss. Therefore, it makes more sense as a business for Nintendo to make their error on the side of a shortage.

If that explanation does not work, recently Nintendo of America President Reggie Fils-Aimé tried to explain how Nintendo planned the amount of Switch consoles produced to Andrew Webster from The Verge. Then, the longtime Nintendo executive admitted sometimes the company simply messes up.

“We create a plan, we build our programs against that plan,” he said. “But based on what we see in the marketplace we make adjustments, and we go from there.”

The Reason for the Nintendo Switch Launch Shortages

“As we began the ramp up with our communication activity, starting with the video we released in October, then the hands-on events that we did in January, clearly we began to see a consumer response that was very positive, and there was a lot of excitement. So at that point we began to improve on our production capability.”

Fils-Aimé also refers to the upcoming New Nintendo 2DS XL launch with the comments below.

“But what we try and do, is manage the overall business to deliver as much financial results as we can, and also as much consumer satisfaction as we can.”

“We get it right more times than we get it wrong. But sometimes we get it wrong.”

Fair enough. What he said follows the initial theory of companies only ramping up demand if the interest is clear.

The Switch officially released on March 3 and remains sold out in many areas. As for the New Nintendo 2DS XL, it launches on July 28 and will help generate support for their 2DS/3DS line at least a little longer.

About author

From around the web: