Reply To: GW: Why do they do it?

[slayerofworldsParticipant 3449xp 2]

Technically its not really about FOMO, and using that for a tactic to make sales.   It is kinda, but not really.  Atleast not in my head.

GW is publicly traded company, that is the real root of the “problem”.

Stock companies are all about optics.  What looks good on paper is all that matters.   Meeting demand and looking good are not the same things.  Selling out of a production run looks really good on paper.  I mean really good.   Honestly people think that meeting customer demand is the way to go in order to make money.  Which is true to an extent, unless your a publicly traded stock company.  Then you have to factor in making things look even better on paper.

Lets say for example you run production in groups of 10k units.   You estimate demand to be roughly 96k for a product.  So normal people might think you would run 100k units so they meet the estimated demand.   However that leaves units in the warehouse.  That looks bad on paper, as you overproduced.  Second, that is an estimate of demand.   So a company would perhaps only produce 90k,  or maybe even go as far as producing only 80k units.   Then the can better guarantee they sell out of product,  which looks great to investors.

Logic says that you are just leaving money on the table by not meeting demand, and that doesnt make sense.  However, when you factor in stock pricing, and keeping your price high,  companies do a lot of things that dont always seem to make alot of sense.

Just my opinion.  I have no real way of backing any of this up.