Apple iPhone 5 Supply Under Constraints As Demand Soars

Whenever Apple releases a new product, the consumer anticipation is so high that pre-orders usually sell out in record time whereas people line up for hours on end outside Apple Retail Stores around the world. With demand generally being so high, even a company like Apple often faces demand supply issues. In true Apple fashion though, such issues are quickly resolved and smooth supply is ensured to all prospective customers.

Its a bit different this time around. The iPhone 5 was released a couple of weeks back to unanticipated demand. Pre-orders sold out in under one hour and in subsequent hours shipping times already started slipping by weeks. With the holiday season fast approaching, it is evident that Apple’s iPhone 5 related demand supply issues are not going away any time soon. Reports indicate that iPhone 5 supply is under dire constraints whereas demand is soaring at an all time high.

Piper Jaffray analyst Gene Munster is known for his insight in Apple’s supply chain. His forecasts to investors have a good track record. Gene had previously predicted that Apple will sell around 27.2 million iPhone 5 units by the end of September 2012, but now he believes Apple may have sold only 25 million iPhones in said month because supplies of iPhone 5 are extremely limited. This limitation is having an adverse effect on delivery and shipment times. However he maintains his prediction of 49 million iPhone 5 units sold by December 2012.

The surge in demand is also due to the fact that over 170 million post paid customers in the USA have reached the end of their contracts and they are shifting to the new iPhone in huge numbers. This is just one of the reasons why demand has soared, adding to Apple’s woes as it struggles to get more iPhone 5 units in the hands of as many customers as possible. Surely Apple’s suppliers would also be under a great deal of pressure because the Cupertino California company is likely to be pushing them to do more in order to plug this supply gap.

If Apple can get a hold on this problem and ensure smooth supply of iPhone 5 units, then its December quarter can be one which will break all previous iPhone sales records for Apple. At least the analysts believe so. There is no doubt about the fact that this new 4 inch iPhone 5 has been very well received, despite initial criticism that it was an evolutionary device rather than a revolutionary one. Whatever the case may be, it seems as if everyone wants one!