@MonsieurX said:
@notafanboy said:
@clyde46 said:
Brah, all I'm seeing is you pulling some random factoid out of your ass and then running with it.
Dude, you don't fucking go "1 BILLION SALES LTD, FRIENDS!!! I'LL BUY TONS OF COMPONENTS FIRST YEAR!!! GIVE ME BEST DEALS!!!"
to:
"Alright. Well, we're obviously not selling 1 billion LTD. We think it'll sell 30 million LTD, so we're cutting orders by 90% next year. Can we keep the same price as this year? Ok, thanks, friend!".
Component suppliers definitely increased component prices significantly. You don't cut down on 90% of your projected orders without getting large price increases.
But you don't have any sources on the actual prices or deals it got for the components.
They are highly accurate educated guesses based on my experience in logistics.
I've worked as an import coordinator and run an independent customs brokerage firm. I've also helped several component suppliers/buyers hedge their orders in case of unexpected price drops/increases as an actuary for a large consulting firm. I've seen their financial statements and deals for high-volume accounts.
Initial component prices are based on projected lifetime sales and amount of sales in the first year. There is a contract for 1 year usually keeping the buyer responsible for buying a set amount of components for the first year.
After the first year is over, the buyer assesses if their initial lifetime sales assessment is correct. If it's within an acceptable margin, the contract is renewed for another year unless they find another supplier.
If the initial assessment is incorrect and lower than predicted, the buyer reduces their component orders and the supplier increases their prices due to low lower economies of scale.
I've had 2 specific cases where the buyer reduced their orders by 95+% in the following year following disastrous sales and the supplier increased component prices by 4.5+x what they charged the first year.
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