If you want a OnePlus One, you understand how rough it can be. Invitations, flash sales, and terribly misguided (read: offensive) marketing schemes get in the way of us just being able to buy a phone. At $299, though, the headaches are more than worth the wait for some. Offering top-end specs with a low-end price, the OnePlus has sat in Google’s warm Nexus chair left vacant by the Nexus 6. If you’re curious why it’s still so hard to get a phone, OnePlus’ founder has come clean.
OnePlus only orders what they can sell. That might sound like a cop-out, considering so many fervently scramble just for the chance to buy one, but it’s sound thinking. OnePlus makes very little revenue per phone, and as OnePlus founder Carl Pei told PC Magazine, “Sooner or later, it’s going to stop, and we don’t want to be caught with too much inventory. With no margins, we can’t have a situation where we have too many units and we’ll have to discount them”.
Pei also said the original goal for OnePlus was 30,000 phones. Shipping 50,000 would have been good, and 100,000 was considered great. “We now aim to ship a million devices this year, and we’ve already surpassed half a million”, Pei said. A benefit to “shipments” is that they are sales, since OnePlus only sells direct to consumers.
Pei’s answers may sound like a cop-out, but let’s appreciate OnePlus for what they are: a startup, and one that is trying to build a hardware company from scratch. Pei also noted he needs 90 days lead time to make any changes with OnePlus’ display manufacturer, so quickly shifting isn’t plausible.
If demand dries up, OnePlus and Pei likely feel as though they’ve got no avenue to recoup what would be nearly 100% loss. The easy answer is to discount the device, but margins are already tight. You could sell the OnePlus One in another country, but in many instances even $300 (for the US) is a lot of money elsewhere, and OnePlus has no marketing muscle to flex.
I’ve been critical of OnePlus plenty of times, but what they’re doing is beyond difficult. I won’t discount their efforts, even if I don’t agree with their methods all the time.
Source: PC Mag