Making It Up on Volume

From The New York Times, in February 2007:

If his Olevia line of televisions was ever going to get any attention from consumers, Vincent F. Sollitto Jr. would have to do something big, splashy and, in economic terms, just plain crazy. On the day after Thanksgiving, Mr. Sollitto, the chairman and chief executive of Syntax-Brillian, had 32-inch Olevia liquid-crystal display TV sets selling at Circuit City for $475, almost half its regular price.

Syntax almost certainly lost money on the TVs. The flat screen that makes up about half the cost of an L.C.D. TV is about $350 on its own. But Mr. Sollitto could not have been more pleased. The Olevias outsold Sony and other brands while they lasted. That forced the premium brands to lower prices throughout the holiday season and take notice of the upstart from Tempe, Ariz.

Today:

U.S. television set and digital camera maker Syntax-Brillian Corp. filed for Chapter 11 bankruptcy protection on Monday after a year of weak sales, litigation, executive changes, accounting problems and liquidity concerns.

Perhaps instead of “just plain crazy”, selling your product at a steep loss is “just plain stupid”.

★ Tuesday, 8 July 2008