Did Apple Ban Best Buy from selling the iPad 2?

Fri, Apr 8, 2011

News, Rumors

There’s trouble afoot at Best Buy. Word on the web is that Apple has forbidden Best Buy from selling the iPad 2 due to some shenanigans from the nationwide electronics retailer. CrunchGear is reporting that Best Buy stores came up with an artificial daily quota of iPads to sell, and once this number was reached, they told interested customers that they were out of iPad 2 stock when that wasn’t the case. Apple COO and interim CEO Tim Cook reportedly got wind of what was going on and suffice it to say, he wasn’t happy and put the kibosh on Best Buy selling iPads until further notice. Cook is reportedly now involved with “negotiations” with the retailing giant.

As of now, this is all a big question mark, and we’ll keep an eye out for reports on Friday morning to see what the iPad 2 situation is like at nationwide Best Buys.

Update: We’ve called 6 Best Buys on the East Coast (3 in NYC and 3 in Boston) thus far and all of them are “sold out” of iPad 2s. We’ll keep this non-scientific poll updated throughout the day. The automated greeting message for one Boston store specifically mentioned right off the bat, “We are currently out of the Apple iPad 2.”

Meanwhile, a purported Best Buy employee on Reddit writes that they’ve been told to “hold any iPad 2s that we currently have and any that we may get that are not already promised to customers for pre-orders.”

Delving deeper into the root of the problem, one reader wrote the following to 9to5Mac:

Re. the Best Buy story. Best Buy is in a dispute with Apple over price protection of the remaining stock of iPad 1s. Apple is only providing price protection on units that were delivered 28 days before the iPad 2 launch, which left Best Buy with thousands of units that weren\’t protected. This translates into 10\’s if not 100\’s of thousands of dollars they\’ll lose. This hold back on iPad 2s is a negotiating tactic to get Apple to cave on their price pro decision.

Update x2: Addressing the issue, Best Buy sent the following message to BGR this morning:

Best Buy continues to receive iPad 2 inventory from Apple on a regular basis. As we’ve said previously, we are fulfilling customer reservations first. Our stores have been asked to temporarily hold non-reserved iPad 2 inventory for an upcoming promotion. This is a customary practice for us when there are supply constraints. Best Buy enjoys a great partnership with Apple, and we’re delighted by customer response to iPad 2.

Hmm.. So on one hand there are supply constraints, yet on the other, the retail giant is deciding to temporarily hold non-reserved inventory for an upcoming promotion? And who, exactly, asked Best Buy stores to hold onto their non-reserved units?

Best Buy has long been a strategic partner of Apple’s and often carriers new Apple products on launch day or shortly thereafter. Best Buy also is the home of those unique “store within a store” sections for Apple products that that not only help differentiate Apple’s offerings from the rest of the pack but also deliver an Apple Store type of feel as well. This past March there were even reports that Best Buy was planning to give its staff iPads in an effort to push its vision of a “connected world” to the forefront.

Notably, the comments at TUAW are filled with folks corroborating CrunchGear’s story, with one employee stating that Best Buy even got new iPad 2 shipments in today but were precluded from selling them.

Another commentor writes:

It happened to me today. Best Buy employee told me that they had some in stock but were told by Apple they could not sell them. Very frustrating because I have been going in every two days to check and they finally have some and they can’t sell them.

And another:

It happened to me tho I wasn’t sure if people at Best Buy was telling the truth or not so I couldn’t judge. I checked the Best Buy’s inventory online and it said they have iPad 2 so I went there (it located near to where I live) but they said it sold out. I showed them the online via iPhone to prove and they denied it. I made one of the staff to check it and I wasn’t sure if he actually searched or it or pretend to. haha. I checked the online few days later, it was still in the stock and this time I called….again they said it sold out. Basically I had no idea what is occurring on and it was quite annoying.

One Best Buy employee at a large Best Buy outlet in the Southeast sent in the following to 9to5Mac as well:

I handle pretty much everything Apple related in our sales department including inventory, training, and keeping up with  the latest Apple news.  Yesterday we received a small shipment of iPad 2′s, and as soon as they were brought out to the sales floor my supervisor told me that we could not sale them.  I asked him why and he said that the managers received an internal email saying that we were to hold any available iPad 2′s and were not allowed to sell them. We were also instructed to tell customers that we were out of stock and not to mention anything to customers about the inventory we were holding.  No one really had an explanation as to why, so we locked them up in the warehouse until we hear more from upper management.



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