Nintendo Unprepared For COVID Sales Surge
Japanese gaming giant, Nintendo, is dubbed to have been notably unprepared for a surge in demand for its Switch console amid coronavirus – will it be able to ramp up supply before demand from home-bound consumers wanes?
Already strong demand for the best-selling Switch console has become exacerbated by a slew of new title releases (e.g. Animal Crossing: New Horizon) and self-isolating customers during the coronavirus pandemic.
As previously reported, Nintendo intends to increase production for the Switch by 10% this year, however, remains cautious given prior supply chain woes.
“We hope [suppliers] will be responsive to the production increase, but for procurement of some parts, the outlook remains uncertain, and we can’t forecast exactly how many Switches can be supplied,” a Nintendo representative told the Nikkei.
Commentators question whether the Japanese giant will be able to capitalise on heightened pandemic demand, given its inability to produce sufficient quantities pre-COVID19.
Most Australian retailers list limited, or no, Switch stock online, with private sellers offering for sale online at a premium mark-up.
According to the the Nikkei Asian Review, international suppliers are now being told to prepare for the production of 22 million Switch devices – up from 20 million last year.
Commentators claim Nintendo was notably underprepared for the sales surge – already combatting supply chain woes – and is reportedly now scrambling to procure parts and lift production.
In February, Nintendo informed Bloomberg it did not see any “major impact” on shipments to the United States as it saw early signs of supply chain constraints just as coronavirus started spreading around the world.
Commentators claim Nintendo’s hardware shortage mirrored the virus’ spread, with private sellers mark-up rising with limited retail supply.
Market watchers question whether the Japanese giant will truly leverage unprecedented demand prompted by coronavirus, or whether experimental home-bound consumers will defer to a gaming console from Xbox or PlayStation given availability.
Nintendo is scheduled to reveal fiscal-year earnings next month.