This page has been archived and commenting is disabled.
About Those "Record" Black Friday Sales...
Yup. The rumors were all true: record sales... on negative margins. Because it is not difficult to dump product when you are, well, dumping. Case in point is Corning which today preannounced a lowered Q4 outlook. And if anyone should know about the state of the market for the most desired item (after the Apple trinkets of course) namely LCD TVs, it's Corning.
From Citi:
Another Negative Pre-announcement — On Tuesday Corning lowered its Q4 outlook. Despite healthy LCD TV sales, a customer in Korea has reneged on contracted deliveries into year end, resulting in SCP volume growth of +5%-+10% vs. +20% prior; this action is unprecedented according to Corning. In response, Corning is idling ~25% of total capacity (we believe primarily in SCP, where it will take charge). Add'ly, Gorilla now expected to decline -25% q/q vs. prior -15% guide due to softer tablets (we believe weak Android and RIMM tablet sales).
Feeling Blue about Black Friday TV Sales — Investors seemingly cheered aggressive LCD TV promotions and anecdotal reports of healthy sell-through. We agree that price promotions were certainly aggressive, but we are left feeling "blue" about Black Friday – What does it say for the state of LCD TV demand if the only way to stimulate unit growth is with massive price cuts? If the supply chain was unprofitable before recent aggressive retail pricing, how much worse will it be going forward as consumers' expectations are now likely anchored at the lower price points?
Glass Pricing May Have to Come Down, and Sharply — LCD TVs have shown remarkable price elasticity, implying that the only way the industry can grow units is by lowering prices. In our view, this boils down to one key question for Corning: How long can glass pricing hold firm (or at least inline w/mgt's plan) with glass accounting for ~20% of the cost of an LCD TV panel, while the entire downstream LCD industry is unprofitable and glass makers capture essentially all the entire profit pool?
Bottom line, the LCD foodchain is unhealthy and we don't believe GLW's glass margins are sustainable over the long-run. The decline in margin will likely come in the form of a series of ASP declines, some of which will likely be inline with mgt's long-stated 2-3% q/q declines, but some of which will likely be step-function declines in the high single digits.
Ok, we get the problem with price points: the only reason anything sold is because retailers ate it in the form of negative margins: surely the upcoming pounding of the discretionary retail sector will be enough punsihment for that.
But not enough glass? Can't someone just blow a nuke in the desert? Suddenly there will be an epic glut of glass.
Now...if onlt someone could put two and two together and combine a desert and a nuke. Hmmm: this is a problem with added difficulty and will require at least a Nobel peace prize winner for its prompt solution.
»
- 26991 reads
- Printer-friendly version
- Send to friend
- advertisements -
so what!! it's revenue generating.. you can always fire people to turn a profit
yeah, Tyler, STFU already.
You're harshing my fucking mellow.
So they are losing money on the product, they'll just make it up in volume or something
It's a good thing they have their solar business to fall back on.
In addition to every other government stats we now need to mark Black Friday sales # to myth as well.
The bigger tragedy in this is trace the 'Sale" back to Foxconnn or wherever, where the labourer's already meager wage is made that much more meaning-less give-away by loss leaders and arbitrage.
ORI
/the-plan/Updated
There is no way that I'm expecting revolving credit to increase this month to pay for this. No one could possibly foresee that we are selling more of this imported junk at lower prices on credit cards. No way.
You'd have to be a fucking genius to work that one out, far cleverer than me...
Somewhere in the conference room of a large, crippled big box retailer, the following conversation is taking place:
CEO: Why are we losing this much money on record transactions?
Senior VP: It's the loss leaders. People came for the door busters and then left quickly. The economy is sucking badly for most.
CEO: What are we going to do about this?
Junior VP: With an average loss of 30% on doorbusters, can we triple our doorbusters & make it up on volume?
Junior VP is real.
Nor could anyone possibly see that this is deflationary.
... Just sayin'
The Bernank is convinced that massive printing and ZIRP4ever, while giving large financial institutions interest free money to drive commodity prices higher with, thus driving down consumption power, is the way to prosperity.
it's not about prosperity anymore.. they just want to further incase the peons
everyone needs to realize that the Bernake, et all are not 'dumb and screwing it up' - they are managing the situation exactly for their side of the tracks
Zirpes, the gift that keeps on giving.
Deflation- The destruction of wealth.
even the dipshit radio talk jocks were hyping it...the shit wouldn't have needed to have been hyped so much if it were true. It woulda stood on its own.
But everyone had to pimp the fuck out of it and it was people who had no clue about any numbers. Sort of a concerted effort to drum up confidence, probably came from senior mgmt to spin a nice mythic narrative.
People killed people in order to get their hands on something they couldn't have afforded...fuck Christmas.
agree, but, hey man....don't "fuck christmas"
that aint christmas...never was
Trav, after reading your comments now for a few months, I have decided that you are a fucking inbred mongrel!
i think he might be being jocular
an inbreed mongrel with a viewpoint usually worth reading though in my opinion, even if i don't agree. I'm fucking over blogs where everybody agrees with each other in one massive circle jerk. Even more over pointless fucking comments that attack somebody with......... a worthless character assesment.
On a more positive note:
"Now...if onlt someone could put two and two together and combine a desert and a nuke. Hmmm: this is a problem with added difficulty and will require at least a Nobel peace prize winner for its prompt solution"......
Tyler you fucking crack me up.
im no expert, far from it, but don't negative marins imply that you are just trying to get back as much money back from your failed inventory buildup as possible? Some hoped for a light at the end of this pesky "recession" which doesnt appear to be coming anytime soon but now all your $$$ is sitting in a pile of TVs in some warehouse with nary a consumer in sight.
Black Friday was the jump-off point and the christmas season is the swan-dive. Anyone who's still holding anything that needs "disposable" income for the purchase by the time Europe does its thing will regret their complicity in the channel stuffing delusion. They'll be left holding the inventory bag but this bag has warehousing and storage costs on it so toss it to the wind or to the greater fool but anyone who keeps it will find it is actually a leetch on your bottom line.
The motto for the coming times, in service as in retail:
Lean and Mean
I'm no expert, either, but... they mark down the big box items to get people in the store, and make up for it by marking up all of the peripherals 400-500%.
"BTW", if you want to get true HD, you're going to need a good HDMI cable".
"Better give me one."
"You'll also need x,y and z."
"Give me some of them, too."
Only now, people must be beginning to realize that you can buy that HDMI cable that Best Buy charges $100 for on ebay for five bucks plus shipping.
go to monoprice.com they sell cables CHEAP!
Do I have to buy the pepper spray before I nail the other sheeple in the Walmart with it or can I grab it off the shelf, unload, snag the fucking Xbox and put the can back empty?
That's the difference between long & short pepper spray I guess but then again mall cops & other needle dick pussies are three-cornering the market these days.
well since you put it that way....
glassmelt, bitchez
They can just harvest the glass from Iran in a couple of months, right? Iran will become a net exporter of glass. A Keynesian wet dream.
The Keynesians would first have to break the glass, get the glass man out for the repair, then have the war that makes more glass so that they can go around shooting out windows to make that multiplier rise. You take care of everything all at once...
Hmm.. It sounds incredible, but I have to wonder if Paul "Nobel" Krugman even knows who Bastiat was.
We take a small loss on each transaction, but we make it up in volume!
lol. so true. I bought 6 items from amazon and got 2-day free shipping on all of it. In the past days, they have sent me notice that it was broken into 5 separate UPS shipments.
Actually, Amazon is making that up by fucking the people that sell on Amazon.
I sell from a small shop on Amazon and the shipping they ask customers to pay is now much less that what reasonable shipping now costs. So my sales price is eaten up by the gap between actual shipping and what Amazon is colllecting.
And they're taking a bigger chunk of my sales to boot. So my margins are going to shit so Amazon can offer free shipping.
So, is this a repeat of the old classic?
"We're losing money on each sale, but we'll make it up in volume."
That's biflation in action, baby
That's another bullshit phrase like "if you're not grownig, you're dying".
Yup. It started showing up in the regional reports in October: inventory liquidation at low prices.
Since glass is a liquid, drink up bitchez!
An interesting note - glass is a liquid
The fact is that there are so many people selling whatever little shit they have left to raise a few dollars that instead of going to the Mall (puke), you can just go on craigslist or ebay and find anything you want, slightly used, for a fraction of the stores "heavily discounted" price. and in the process...you're helping out somebody that needs to raise some cash. It's a win win...unless, of course, you're a store in a Mall...then...oh well...life sucks, get a helmet:
Yup. The barter economy is on the rise as predicted
Research RFID chipping on the internet. This is on the rise also, as predicted. The one world currency will be a form of credit card, but in the form of an implanted microchip. Obama is pushing for a form of it by pushing to have all medical records digitized so they can be put on an implantable RFID chip (Research Obamacare RFID). This is the first step. Then money will be put on this chip. Then our drivers license. Then our library card. Then GPS. And this is just the beginning. It can even be used to allow us access to our homes and computers. If it is digitized, it can be put onto an implantable RFID microchip. It is all pointing in this direction. This is also why Obama is pushing for high speed internet to reach every man, woman and child in america. Just as you can't have cars without gas stations, you can't have implantable RFID chips without the internet. Research it on the internet. Everything about implantable RFID chips sounds great doesn't it? But, if you disobey big brother, he will turn your chip off and you won't be able to buy or sell without it, you will have no access to a doctor, etc. You see, this great technology will be used to enslave and control all of us. It sounds great, but it will be used for evil purposes. It's called the mark of the beast. Many christians know about this. But non-christians should research it also in the Book of Revelations 13 and 14. Here is part of it. You can read the rest for yourself:
And he (Speaking of the Beast, or the one world government), causeth all, both small and great, rich and poor, free and bond, to receive a mark in their right hand, or in their foreheads: And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.
One world currency. Get over that shit. They can't even do a one european currency. China just dying to get in on that. One world currency is for complete morons- of that I am absolutely positive.
If a one world currency is for complete morons, then that should raise the likelihood of it happening, not lower it...or have you forgotten that the world is currently being ruled by complete morons?
With USD as the fiat world reserve for forty yrs how much more proof ya need that the whole world is exactly that stupid.. B Franklin has been on the spin cycle since LBJ lumped SS into appropriations in '68. Fuck this country.
Joe Hockey from the Australian Liberal Party (and potential next leader of the opposition and PM) has been pimping that same idea since about 2005. They withdrew it at the last election on the grounds of costs, and the need to lower the deficit.
But they definitely intend to do it.
Voluntary of course, but if you don't 'volunteer' to have one they will simply make services increasingly unavailable via any other means, until you 'volunteer' to have the RFID 'smart chip' tech on your person, in order to do most things.
And what do they call it : "The Access Card" (formerly known as the "Australia Card" ... until it was rejected as too infringing on personal privacy)
ABC Radio National Background Briefing
http://www.abc.net.au/radionational/programs/backgroundbriefing/getting-...
AUDIO MP3- Getting smart: the Access Card
http://mpegmedia.abc.net.au/rn/podcast/2007/01/bbg_20070128.mp3
So convenient! ... much better than tattoos ... dunno about any beasties etc., the beasties are us.
I always wondered about this RFID cashless society and giving to charity. When coming out of the store or passing by a homeless person, I usually throw in the spare (fiat) change that I have. With cashless, that would be too much of a hassle. Plus I'm sure it would be hard for beggars to buy an RFID reader.
I work for Bestbuy. We lost alotta FRNs on allotta crap!
You lose money on the guns, you make money on the ammo.
Ah the old Gilette razor scheme. Nice.
I got Gilette razor in the mail on my 18th birthday along with a selective service card; Gilette gets my money Uncle Sam gets my life, all in one day!
I know I got a selective service card but not sure where it went. If they get the draft again, I'm sure they know where to find me in any case.
Got out of that crap. 5 blades for fucking 20 dollars? No.
I buy German Blades for 5 dollars 10 pack and have a bunch for the razor made for them. 50 dollars spent good for a year.
Otherwise it's a two hundred and change cash for Gilette for the year.
Regarding glass, I would not stress about it. Plastic will do the job just as well.
As long you have the Silver and other material to keep cranking out the LCD's you are fine.
Retail is shit pricing. You can pick up a LCD on nothing almost anywhere you care to look.
Uh, you know plastic is made from oil?
I bought a 1960 Gillette Fatboy safety razor and 1000 double edged Blades. Used the money I saved and bought a luxury badger hair brush. The freaking soap is like a dollar a cake. I can shave the rest of my life for about 10cents a week. Mach 5 at 17 bucks for three blades? Don't make me laugh Corporate Gimmick boy Im goin OLD SKOOL.
i agree with you completely...straightedge, brush, soap and whetstone...
.
I'll be looking to get a straightedge soon. Makes for close shave and lasts forever if you take care of it. Plus having a non-safety blade that close to your throat makes you pay closer attention to what you are doing.
And I grow a beard you fucking woman!
Thats true because nobody want LCD because they are not as good as LED
uh...dude, LED TVs are LCD just with regional LED backlighting.
The only true LED TVs are the OLEDs which are still insanely expensive.
explain please, curious...
IIRC in OLED each little pixel as an active light emitting component as opposed to an LCD pixel being used to colour the existing white back-light provided by LEDs. Huge difference in technology and price.
I don't profess to have any idea what this means but it sounds like I should buy an OLED...
But thanks anyway...
unless you mean OLED you aren't really passing plasma with either of them for movie quality... LED is just inventive backlighting.. lower energy, hit or miss on the uniformity.. and some edge bleeding halos for good measure
grap IPS for computers
edit:: trav got his late night coffee and beat me to it
hmmmm....corning circa 1999
wicked deja vu
hahahahaha...
When Black Friday comes I'll stand down by the door
And catch all the men who dive from the 14th floor
Becker/Fagan, "Black Friday"
And catch the gray men when they dive from the 14th floor.
Close but no cigar.
Steely Dan
h/t
but it's "catch the gray men when they dive", I think
Black Friday with population reduction and live blood sport TV!
Next black Friday instead of having the products at a wal-mart. How about putting a huge cube, maybe a diabolical black cube with products in the middle of large fields football size at least. And plant land mines all over these fields. And the products ie DVD's, Video Games, waffle irons are all free. Just have to navigate the land mines while you fight your fellow pickers. And televise the carnage! Imagine the advertising revenue! Call it Black "Mine Kampf" Friday.
I've been waiting for the real life version of The Running Man.
"I choose Ben Richards. That boy is one mean mother fucker!"
Who loves you and who do you love
Just make Black Friday a pay per view event. Give Black Friday shoppers gift cards for the lower and lower levels they seek anually (whether it's trampling a WalMart employee, or macing your fellow shoppers).
ummmh,... nuke in the desert -
priceless
Long Iranian glass futures..
cant we just make tv screens from recycled soda bottles?
More sales, more revenues.
As long as CNBC touts that first, the Company's stock price will go up and stay up just long enough for the CEO and the Board members to unload their shares or exercise their options well in the money.
That's what it's all about.
You're dead meat.
Welcome to what happens when you pay $110 for a barrel of Brent to fuel the transport ships.
"Oh! What do you mean we lose money on each unit? Can't have that. Maybe we can get a fuel subsidy in that thar upcoming legislation that "postpones" the Sequester."
Sounds like deflation. Where's all that computer money the fed & banks created? Oh I forgot about the bonuses.
There's plenty of glass in Dubai. Just take it off of some of the half-built sky-scrapers with 'space available' signs posted on them.
Corning doesn't supply to the Apple iPhone4s or iPad2
Right when I was getting hopeful that our economy was starting to improve, the truth comes out. Well, since these companies aren't good at making money anymore, maybe they decided to start getting good at loosing money. Well, so much for tax receits increasing on better profits. I guess our government has also given up and decided to keep loosing money also. They got pretty good at that. Like I said in a previous post. The government will cut nothing by the deadline. Instead, they left it up to us.....to forget there was ever a super committee to cut spending. Just water passing under the bridge. The only thing that was planned was the charade. No spending cuts or tax increases were ever planned. What do they have planned for this country (and world) next. I guess we'll have to stay tuned tomorrow for the continuation of this soap opera. I'm sure it gets worse, much worse.
negative margins ???????????..........damn , i didnt even think any of the sales prices were all that great this year !!!!!!!!!!!!
Did you know that Walmart sells single slug 12 gauge and hollow point 9mm at discount prices? i found that out tonight and topped off my basket. Thanks Sam!
It's hard to get ammo at Walmart around here, 9mm is usually sold out.
At least they can grow which is more important than profits in real business. Today money is made by public offerings. Get a free TV now and pay it later through your 401k.
They added another day to the Black Friday weekend revenue figure this year (Thursday). It is a no brainer that revenue this year will beat last year when there are four days of revenue reported rather than three.
The idea was putting out a $199 TV you lose $50 on but you make it up when a person can't get the $199 TV and buys one you make $60 on netting you a $10 profit on each sale of a $199 TV. You also limit the number of $199 TVs and then you'll sell far more profitable units. That is actually the way the retail planners think. I deal with these idiots every day. The plan doesn't work when you get 200 showing up to buy 20 TVs and 180 walk out buying nothing.
But that shop selling the towels made a killing? lol That vid was f*cking hilarious...
as long as all those zombies used their SNAP cards on Sunny Delight on the way out
More evidence of deflation.
OK all you speculators that don't really have a clue, HERE are the facts. Margins will be down about 20% this year when this whole $1.28 dollar towel fight shakes out. I know this for a fact, I live it everyday, I deal with the public in retail and know first hand what it takes to make the deal. My numbers for November 2011 were double of what I did in 2010. The only problem i have is I worked twice as fucking hard and put in many more hours and made 30% less profit! It's that fucking simple folks, yeah a monkey with a note can sell an i-pad for $79 dollars but after feeding the monkey a few bananas, you have still lost $50 dollars. It's survival of the fittest now, time to weed out the wanna-bees from the real players.. The hopium is wearing off and most people are starting to realize that their American Dream of being a small business owner is turning into THE AMERICAN NIGHTMARE.You thought you saw alot of FOR LEASE signs before? Think Again, you aint seen nuttin yet. CME is frickin toast, they borrowed on more hopium and will soon be sending jingle mail just like the homeowners. I live it everyday, I hear it from real people, from all walks of life, if you want to mindfuck yourselves and go into haze mode, go ahead, you may be better off that way in the long run..JINGLE MAIL,how appropriate for the season...JINGLE ALL THE WAY..HO, HO,HO, HOW'S THOSE FLEA BITES BITCHES.....
All the Fed heads can cause more inflation and drive down demand even further. Wages certainly aren't going up. When you have global wage arbritraion and multiple layers of prospects begging for jobs it's easy to reduce wage offers. The consumer is being squeezed and eventually up the food chain.
Plug that one in your model equations Bernanke, Dudley, Bullard, Evans and the rest of bozos at the Federal Reserve. You guys all get dunce caps.
That giant sucking sounds
.
Black Friday
I can see business desparity all around, they are desperatly competing for new channels of revenue:
- My local cell phone carried promotes "get two cell phones for your kids, and receive free ipad"!
- My local beer and wine store has "We appreciate seniors! 10% discount on Thursdays for all 65y+"!
soo we'll have "if you can breathe you get 50% on LCD TV"
Negative margins. Impressive.
I livein Vegas, so I'm holding out for "We'll get you a hooker! And not one of them fat or skanky ones, neither! We're talking laid-off teachers and secretaries and pharma & radio salesgals. Sign here, pls." Beats the shit outta senior day at IHOP.
On TVs though, it's entire possible they are flushing out older tech pannels for something newer coming.
"GET THAT STUFF OUT"
Can there be any doubt they are desperately propping a pure Ponzi when they have to lie about absolutely everything to maintain this laughable but very idiotic confidence artifice into pure absurdity.
When they have to do that you know the whole sick irredeemable system is dying on the vine.
Why else would they have to do this?
What this shit is, is some Wall Street punks who stole the global BMW, and are running the engine into the ground to destroy it, before they set fire to it. That's what's really happening; break it so bad it needs replacing with the new global NWO model.
Happy Thanksgiving, go long blunderbuss's and powder.
The sales were up...people buying bargins..or so they thought...but then they will not buy anymore..unitil the retailers invent another blowout day or event..probably the last week of Christmas...in dollars ...sales will be up...inflation...profits all over the board...high end up...low end mixed if not down..but all in all..the retail should be down as a % of the economy...and yes credit cards will be used....This is my prediction...IMHO
well some of those black friday profits are gona be spent fixing the rest rooms . ive spent everyday since fixing stuff at 3 wallys and few mcD. today i gota replace a 475 buck electric eye toto toliet valve that got peppper sprayed. that is if actually gets here from fukishima
Yeah but pepper spray margins are still good.
WE'RE JUST NOT INTO PROFIT GENERATING!!
MONEY'S FOR NOTHING AND DEBT IS FOR FREE!
Yaaaay! Moe money!
I was all-in on some furniture that I bought from a company going out of business this year. I finally had to get something to sit on in the living room of the house I bought last year. But, I decided to wait until next year to buy everything else. I imagine by then they will be paying me to haul the crap away.
I work weekends in the cash office at a store similar to Walmart. Before the sales started at 4 am Friday morning, I noticed 4 carts filled with 40” TVs. When I came out of my hole-in-the-wall at 5:15 am, half of the registers had been closed and the cashiers sent home. Only 1 TV was gone from the 4 carts.
The store’s main goal was to get customers to put their purchase on the store’s credit card they just signed up for (and don’t forget the extended warranty!).