Several European individuals emailed me to tell me that some of the items on my "out of stock" list are in stock in their country.
It's true that this Web site is Americentric. Well over half the visitors to this Web site come from North America (and another 10% comes from England and Australia). That's to be expected, since I write in English.
North America represents over a third of Nikon's sales. That number is likely to grow a bit as long as the Euro/Yen relationship continues on the wrong trajectory. Funny thing is, no sooner had I written that a number of items were perpetually out of stock in the US when I received word from two sources (caution: there's a small possibility they could be linked to the same original source) that Nikon is trying to shift some inventory out of Europe to the US. Unfortunately, the Icelandic volcano is disrupting and slowing air freight movement, so you can no longer exactly count on packing something up and having it arrive on the other side of the pond the next day. The last day for which I can get figures (Monday), air traffic in Europe was down 4%, but there apparently is also a small backlog of freight generated due to the complete shutdown last month.
Still, one has to wonder why Nikon's largest market is seeing a steady stream of product shortages. As one dealer put it to me, the current "pay as you go" system means that dealers don't want to stock up on much because they're paying cash up front for inventory. When they get orders from a customer for something they don't have in stock, NikonUSA can't ship it to them in a timely fashion. When you add last minute rebate changes, suddenly the dealer sees real demand coming in the door but has nothing on the shelf to fill it with. They can't get Nikon to deliver it to them quickly to save the order, either. It's really an insane situation right now.
If there are any Authorized Nikon dealers with an inventory of D3s, TC-20E III, 24mm, 500mm, or 600mm lenses reading this, send me your contact info. We'll see if we can suck the last of that Nikon inventory out of the corners of the country ;~).
The best way to find an "out-of-stock" product here in the US is to look to the stores in the tweener markets. The big city stores run out because they have large markets to serve and they sometimes don't get their full allocations on popular items. The small city stores never order the exotic stuff in the first place unless they have a up-front customer who paid a deposit for it (because they can't afford to tie up the cash). It's the medium markets where I often find products that are in high demand and low supply. So instead of Chicago, try Rockford, Aurora, Peoria, Elkhart, or Muncie, for instance. Instead of San Francisco, try Reno or Fresno. You get the idea. Still, some things will just be plain out of stock everywhere.
The World Cup Soccer matches coming up in South Africa don't help the supply situation, either. Like the Olympics, the World Cups are a photo-heavy event that increases demand on much of the pro equipment supply.
One comment I had to make repeatedly in answering emails on my essay: sales lost due to underestimating demand and not producing enough of a product have this tendency to be lost sales. The selling cycle of a D3s is two years. If you underproduce for the first year of the cycle, you don't generally make those sales back up later, when you finally up supply. Some folk will start waiting for the D4, instead. Others will have already gotten something else. If you're going to be wrong on estimating production for a high tech device, you're best to be wrong on the high side, not the low, all else equal. That's because you'll never get back those dollars you lost to unfulfilled demand. But you can probably get back the dollars you devoted to excess inventory by having a clearance sale. There's conservative, and there's fearful. They are not the same thing.
When it Rains...
May 20 (news). Bloomberg Businessweek reports that the Nikon China factory shut down last week. More than 50 workers at the Wuxi plant took ill, apparently due to chemicals from a neighboring plant.
And a Comment About My Comments
May 20 (commentary). One site visitor wrote me to express their displeasure that my comments on the Bangkok situation were centered solely on the camera supply situation.
This is a photography site, not a political site. How I personally feel about what is happening in Bangkok (or China, note story above) would be easy to add to what I write, but I think it would also be inappropriate. My primary expertise these days is photography, high tech, media, and business. I believe that's why you come to this site. I'll happily write about those things as they apply to the subject of this site: obtaining and using (mostly) Nikon equipment for photography. But to use my expertise and visibility to promote my social and political views is just plain wrong, IMHO.
Those that know me personally can tell you that I worry and care a lot about what's happening in the world. But I'm not going to do the Hollywood thing and use my tiny bit of fame to promote my personal views on everything under the sun. If I choose to be more active in commenting on or promoting any particular social or political agenda, I'll do so elsewhere, not on a site dedicated to photography. If you desire me to write more on subjects other than photography, I'd be happy to oblige (I think ;~), but again, it won't be done here. That should become even more obvious when I update the site design.
Someone Doesn't Understand Their Best Customer
May 19 (commentary). Nikon is pretty conservative fiscally; they run a tight ship. But the ship is hunkered down for a typhoon when we only have a strong trade wind. Consider this (mostly) out-of-stock list at the moment: D3s, 17-35mm, 18-105mm, 16mm f/2.8D, 24mm f/1.4, 50mm f/1.4G, 60mm Micro-Nikkor, 105mm f/2 DC, 200mm Micro-Nikkor, 300mm f/2.8 II, 400mm f/2.8, 500mm f/4, 600mm f/4, TC-20E III. Seriously short supplies of these products are currently being experienced, and some of those have been long-term shortages. (Some dealers are also reporting to me that a few other products, including the D90, are starting to get harder to get their full orders on, too.)
While I'm not going to let Nikon off the hook, let me first explain why the exotic lenses are so slow to get restocked: it takes as much as a year to create these lenses from first glass pour to final box-and-ship. The glass has to be cured and polished, and for the level of quality demanded and size of the glass, this is a long process that involves a lot of hand work and assessment. Think of the glass in these lenses as making wine: they need to cure to the right age before being polished up and bottled.
You'll notice that a lot of the products in short supply are pro-level products. When Nikon introduced the D3, we got a flood of pros snapping those bodies up. Some of those were coming back to Nikon from Canon, some were new to Nikon. But they all demanded top notch lenses. With the Beijing Olympics being the biggest photographic event following the D3 launch, and given how dramatically the Canon/Nikon ratio switched between the Athens and Beijing games, it's no surprise that the big long lenses got snapped up in late 2007 through mid 2008.
But what's the excuse now, Nikon? Had Nikon done a big run of new exotics starting in mid-2008 to respond to the initial D3-caused order crush, we should have had plentiful supply from about mid-2009 on. Certainly by now. Instead, there are almost no exotics to be had (other than the 200-400mm, which is being replaced soon).
In short, Nikon has misjudged and underestimated the demand for a number of products very badly in the last year. One wonders how long such shortages will go on. Given what we've seen in the past two years, I'd say "until demand for the D3s and D3x goes down substantially." (That's sarcasm, folks.)
A lot of Nikon users are waiting patiently for the D700 refresh. Many are hoping for a D700x type of update, as well. But think about what a high-megapixel count D700x type of body offering would do to the rest of Nikon's inventory: the top performing lenses would all be out of stock. Perpetually. You can't capture 18 or 21 or 24mp with the 24-85mm or 24-120mm and get any tangible benefit from the megapixel bump. No, the appearance of a D700x-type of body would cause a run on the "good" glass that would make everything be hard to get. So be careful what you wish for, Nikon users. (Hint: stock up on the glass before new cameras arrive ;~).
Something is seriously wrong with Nikon's relationship to the pro and serious photographer ranks. First, they're badly underestimating demand. Second, they do not appear to be responding to product shortages in any urgent fashion. Third, we've not gotten follow-on products that have large pent-up demand (D700x, pro DX body, etc.). Fourth, some products need some more attention to minor issues (overheating on the SB-900, for instance). Fifth, if we're going to have video in the products, it has to be professional grade, too, and right now 720P/24 is too restricting.
There is a common denominator here: Japan. None of these issues seem to apply to things coming out of the Thailand plant or China. The problems are in things that are right there in the home market. Can it be that the Sendai plant really isn't capable of keeping up with D3s demand? Is Nikon really afraid to up glass production for the long lenses? (Hint: they could always use that extra glass for some more new lenses that people want, such as a 100-500mm, a 400mm f/5.6, and so on.) Are the designers so overwhelmed with trying to come up with complex projects like the D3000 that they can't push the high-end products up a notch? (That last was more sarcasm folks.) Is Nikon so afraid of the yen appreciating still more that they're unwilling to actually build to demand?
All of those things seem like silly, irrational, and problematic management practices. But if the issue isn't one of those, what is the issue?
I've written this before and I think it's time to once again bring it up: Nikon needs to cleave its Imaging division efforts into two distinct entities: serious and consumer. From the planning stages right through to the sales organizations there needs to be a pro division that focuses on the core and most important Nikon customer, the pro photographer. Basically take the D300 and up, the f/2.8 and faster glass, the 300mm and up glass, and bring it all into one group that is managed and monitored for performance separately from the consumer group.
Further, reinvent NPS worldwide while you're doing this, Nikon. As I indicated the last time I wrote that, the serious and pro photographer group would be willing to pay more, but only if they're given more. More supply, better products, loaners during repair, strong attention to demand, an open dialogue with this constituency, more training, and better service and support would constitute "more" in my book. If that raises the price of a D3s to US$5999 from US$5199, so be it. At least I'd be able to buy another one off the shelf and know that it's got strong support behind it.
All of this is not to say that the consumer side of things is all peaches and cream. But at least those products seem to be in stock.