iPad Resellers Now Camp Overnight at Apple Stores
On Wednesday morning I stopped by the SoHo Apple store in New York City to purchase an iPad for a family member. As I had anticipated, a store clerk said they were out of stock and recommended that I check back the following morning.
Context & Ripple Effects
This is the second spring running that iPad supply has failed to meet launch demand. The pattern was set in May 2010, when many stores sold out of the original iPad and London customers queued overnight for the international rollout. This cycle tightened earlier: channel inventory had already run dry by late February 2011 before the iPad 2 even shipped, and by mid-March Piper Jaffray found the device totally sold out, with roughly 70% of buyers new to the iPad, prompting some Apple Stores to open early on launch Tuesday.
What changed this week is who is standing in line. The SoHo store clerk's advice — come back tomorrow morning — reflects a restock cadence that professional resellers have learned to exploit: they camp overnight to capture each delivery, converting Apple's fixed retail price into a spread against whatever the secondary market will bear. Scarcity that began as fan enthusiasm has become an arbitrage routine.
First-order effects
- Walk-in customers like the SoHo shopper are being crowded out: stock goes to whoever camps overnight, and clerks can only redirect buyers to the next morning's restock.
- Resellers buying at Apple's $499-and-up retail prices gain a guaranteed margin on every restock, since demand documented by Piper Jaffray's March survey far exceeds weekly store allocations.
Second-order effects
- Apple faces pressure to accelerate iPad 2 production and rebalance channel inventory, because every unit flipped on the secondary market is a first-time buyer — the 70% new-customer cohort Piper Jaffray identified — paying someone else instead of Apple.
- Gray-market pricing re-emerges around store locations, echoing the premium listings that followed the 2010 sell-outs, which distorts the retail price Apple controls so carefully elsewhere.
Third-order effects
- If overnight lines persist across launches, queueing shifts from enthusiast ritual to organized resale business, and Apple's launch events become de facto wholesale auctions where the company leaves the markup on the table.
- Persistent post-launch shortages push would-be iPad buyers toward competing tablets that actually sit on shelves, giving rivals a window that exists only because Apple cannot match demand.
The trend: Apple's structurally under-supplied product launches keep converting retail queues into resale markets, with each generation's shortage lasting longer than the last.