Lead times continue to plague Cisco

Cisco singing the same old tune: "Lead times, lead times… sorry (customer) go away – but will you please buy another day?

Or, put another way, When a customer asks for POE, Cisco says… Sorry. Customer says… HP? (see http://www.networkworld.com/community/node/60059) There is no real end in sight for Cisco’s supply chain problems. Customers have been waiting months for some of their most common products. And now, right when market demand is truly inflecting, with a resurgence in both spending and optimism, Cisco still cannot deliver the goods. Check this out from Cisco.com today: Products/Lead time: WS-C2960G-48TC-L 125-132 Days WS-C3560V2-48PS-S 41-48 Days WS-C3560G-48TS-S 62-69 Days WS-X6148A-GE-45AF 28-97 Days This is a sampling of the many of the most popular Cisco switching products sold today. Any customer looking to deploy gigabit to the desktop with Cisco – particularly with POE – would likely be buying one of these products.

The first item listed is Cisco’s cheapest gigabit edge switch and, for us in the secondary market at least, is currently their most popular item. With a list price of $5995 and a street price of approximately $3800, customers are paying $80 per port for a layer 2 switch and waiting 4 or 5 months to receive it. From other manufacturers you can get a stackable full layer 3 switch for less and get it in days. From the secondary market you can get the very same switch for under $3000 and have it overnight. From HP or Foundry or Extreme… well, most Cisco customers never checked before because they didn’t have to.

I particularly like the WS-X6148A lead time of 28-97 days. This is the one main blade for the 6500 series that offers gigabit and POE. There is really no alternative for the entire 6500 platform… and Cisco can’t deliver it for as long as three months? What’s worse, they don’t even seem to know themselves when they will deliver. A window for delivery wider than the length of delivery itself? I imagine the supply chain manager setting this date thinking “hmm, lets see, might get some next month, but then again, who knows, but can’t be longer than three… and in any case by then I can revise the delivery estimate anyway”)

Cisco’s high quality and dominant market position has led to a vibrant secondary market for more than a decade. And, as you might imagine, these delays have been wonderful for our business - but I worry, however, that as Cisco continues to suffer from problems that shouldn’t plague a $400m company much less a $40b one, will interest in HP Procurve and Force10 among others ultimately lead to lost customers and not just curiosity… ? 

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