Channel unites against post-earthquake panic buying

Channel firms warn of data tape price rises and product shortages if stockpiling continues

The UK channel is clamping down on customers panic buying large quantities of data tapes in the wake of the Japanese earthquake and tsunami.

Japan is home to the manufacturing plants of several tape vendors, including Sony, FujiFilm and Maxell, who have all experienced disruptions to their production schedules since the earthquake struck two weeks ago.

Production at Sony's tape factory in north Japan, the area most badly affected by the quake, is understood to have been halted completely since the disaster struck.

Meanwhile, Maxell and FujiFilm's factories in the south of the country have been affected by power outages caused by the instability of Japan's nuclear power stations.

According to several sources, Sony has told partners to anticipate stock shortages until at least June, and some UK VARs are expecting to run out of stock within the next five-to-six weeks.

In a statement to ChannelWeb, Sony was unable to commit to an exact date as to when production might resume.

"Several of our factories manufacturing our professional and storage media products have been affected, preventing us from supplying our products for a time that is still uncertain at the moment," it stated.

"Please be assured that we will do our best to resume as quickly as possible when the situation improves."

Meanwhile, in a further statement to ChannelWeb, FujiFilm confirmed it was struggling to meet the upturn in demand witnessed for its products since Sony's production stopped.

"Our first priority, of course, is to service our existing channel customers and end users and we will try to make available extra stock, when and where this is possible," it said.

"However, in order to meet our first priority, we have to be highly cautious with regard to stock management at this point."

John Townsend, UK sales manager for professional products at Maxell, said the firm is also trying to fill in the shortfall in Sony's production as best it could.

"Sony is a major producer of tapes for a few other brands, so it is not possible for us to fill in for the entire shortfall in their production," he explained.

"There should not be any problem in getting hold of tapes, as long as people do not panic buy and start stockpiling product."

Townsend said Maxell is also closely monitoring stock levels and any changes to its regular customers' ordering patterns.

"If someone puts in an order for 7,000 tapes when they usually only buy 1,000 units, we will be asking them why and to justify the size of that purchase," he explained.

Geoff Dance, company director at tape reseller PMD Magnetics, said his firm is employing a similar system to prevent panic buying.

"We have seen a huge rise in people trying to bulk buy products and have explained to them that doing so will make the risk of shortages greater and the price of the products to rise," explained Dance.

"We usually have a month's supply in stock and are not allowing anyone to panic buy from us."

Joe Fagan, group product marketing manager at CMS Peripherals, said his suppliers have already indicated to him that product shortages and price rises are imminent.

"We do not predict the situation will get very serious," he said. "Nonetheless, our advice to our channel partners is to talk to your customers to forecast needs early based on run-rate and importance of supply. Then discuss with your distributor so as to maximise your chances of getting allocation."