We have posted in the past about Apple’s impressive operational expertise (see here) but now there is a report that puts are hard number to that. Business Insider reports that Apple’s turns are frankly absurd (Wow! Apple Turns Over Its Entire Inventory Once Every 5 *Days*, May 31, see also here)
Apple turns over its inventory once every five days. …
The only company on Gartner’s list of 25 companies that turns over its product faster is McDonald’s, which is not exactly in the electronics business. Dell and Samsung rank two and three in Apple’s category, turning over their inventory roughly once every 10 and 21 days respectively.
It makes some sense that McDonald’s inventory of tomatoes and lettuce does not dally through its supply chain but Apple’s numbers are just astounding. One wonders about some of the details behind these numbers.
For example, when does Apple take possession of an iPhone? Does it own the screen before it is installed or does it only take possession once the phone is completed and shipped? Apple’s overall number may be great because inventory is “hidden” on their suppliers’ books.
When I order a specific configuration of an iMac, how long does Apple own it? I ordered a machine on Monday, my credit card has already been charged, but I won’t receive the machine until next week. If custom orders (e.g., engraved iPads) are a large part of Apple’s sales, they could contribute significantly to Apple’s throughput but very little to its inventory.
(Hat tip to Greg Weiss of Section 62 for pointing me to this one!)