Why aren't ALL packages available everywhere?

Glad to be here Jack 06. Compared to other forums that I have only 'monitored', this one is very useful, civil, and well managed. I feel comfortable posting here.

Let's hope they make enough of our '06 combo . I will be changing my avator as soon as I have a picture of my '06.

 

Oh, we get a little wild & woolly, too, mostly in the Pancake House, but you're basically right. People here cut each other a little slack and/or restrain their venom. The moderation is generally superb.

 

The normal reason for reducing the number of SKUs goes something like this:

Inventory is an asset which doesn't generate any return, and in the case of something like a car, it's probably generating negative return, because the dealer paid for the cars with borrowed money and is paying interest until the car is sold. Most cars are also depreciating a little while they sit on the lot (think of the price at the end of the model year).

So the less inventory the dealer has to carry and still not lose a sale due to lack of stock the better, as it lowers their cost. It's a problem in optimization, how much can you reduce inventory to lower costs, until the cost savings is exceeded by the cost of lost sales due to not having the right product in stock. It's also reduces the possibility of having undesireable combinations sitting around at the end of the year, and having to discount them heavily.

Doesn't really apply to the Prius, since the amount of time they sit on the lot before a sale is measured in minutes, not days. But that's the general idea. If you can figure out how to do JIT manufacturing right, like Dell, then you can achieve sales & marketing's wet dream of every product being unique, while not making manufacturing and the bean counters go nuts.

 

The "minutes" figure I mentioned is out of the Wall Street Journal. Each week they list the fastest selling cars, and at one point the Prius was averaging something like 48 minutes. This is an average, including cars marked up $3-5k that sit on lots for weeks or more, and cars which aren't sold immediately at MSRP because a buyer backed out, or changed their mind about what color or option package they wanted. And unless the dealer took your money and gave you title to the car, it wasn't actually "sold" yet. Reserved != sold. I imagine that a car which is reserved, and sold to the person who reserved it gets counted as zero minutes.

I can't say for sure that the inventory turnover reason is why Toyota wants to limit the number of available option packages. It's true that currently, while demand greatly exceeds supply, they could sell any color and option package. But eventually the supply catches up to demand, and they could be in a situation where fewer combinations makes sense, and perhaps they just want to have a consistent policy, despite the current shortage of product.

 

My ZIP can't have #6 plus leather.

If I win the lottery, I'll have to travel to get the new car...