By Lisa Johnston
New products on display at the American International Toy Fair, held in N
TWICE: Given the conservative product projections made by many manufacturers due to the recession, do you expect product shortages in the second half?
Rob Eby, D&H Distributing: We're already seeing the effects of that. Manufacturers are bringing in less and less product, so it's been up to a distributor to do a more proficient job of forecasting demand. For instance, netbooks and notebooks are almost being built on-demand by certain manufacturers, some not until orders come in. So, right now, if you want to maintain the right level of inventory, it's all about forecasting.
Stephen Bodnarchuk, M. Rothman & Company: The U.S. dollar/yen valuations, as well as shifts in LCD panel production and worldwide distribution, have contributed to industry shortages. We do not see this changing in the second half. Manufacturers are also revising their business models in order to remain viable and produce positive revenue gains. In turn, they are minimizing their risk with regard to inventory as well as new product introductions.
Morey Gottesman, Cardinal Electronics: There are already shortages in the LCD lineup, particularly in the 32-inch class of product. If that pipeline doesn't get filled, shortages will have a major impact on business.
David Kaplan, Digital Delivery Group: We have already experienced flat-panel shortages in the second quarter. Some of the current shortages are in part due to line transitions, but I am worried about fourth-quarter shortages.
Warren Chaiken, Almo: Absolutely. Our business today is supply-chain intense with long lead times and constant changes. Forecasting is extremely important to mitigate fourth-quarter supply issues.
Samuel Golowinski, Z. Reiss & Associates: I don't think there will be any more product shortages than normal. That being said, we have yet to have been given a 90-day roadmap on product introductions. We need the tools, the products and a plan to succeed. The economy has put us in a back-order situation on some products. Some companies are on allocation.
J. Mark Howell, Brightpoint Americas: In general, manufacturers have become more conservative — due to the lack of demand visibility — hence an unexpected spike in demand in the second half on even run-rate products could lead to unplanned shortages in the short term.
Jeff Kussard, Capitol Sales: Yes, particularly as it affects flat-panel TVs, which has been and continues to be most in-demand product of the past year. When the recession started to take hold, TV manufacturers cut back production, and we're paying for that now. It was a knee-jerk reaction that has stymied sales since the holiday season. Unfortunately I don't see it changing before Q4.
R.J. Hirshkind, ADI: Like most others, we've experienced supply issues with flat screens because of last year's conservative production, but now it looks like manufacturers have gotten a handle on the market and will be prepared to stock enough inventory for the remainder of the year. We have definitely concentrated on opening up the lines of communication with our manufacturing partners and dealers to better gauge our inventory demands. I don't expect there will be a surplus of inventory, but I think we will have ample supply.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.