According to the latest report, the global economic downturn has led to a decline in demand for products in most industries. It was previously reported that Samsung is slashing smartphone production. Other parts of Samsung’s business are now facing similar pressures. Samsung is reducing production orders for its smart TVs and home appliances.
Reports from South Korea, citing industry officials, said Samsung was cutting production of its smart TVs and other home appliances. The company had to make these adjustments due to the tough global economic situation and slowing consumer demand. Uncertainty from the conflict in Russia and Ukraine also weighed on demand.
The market research also shows that Samsung’s inventory turnaround time in Q2 this year averaged 94 days. That’s two weeks more than last year. Inventory turnaround time is the number of days it takes for a product in inventory to be sold to a customer. With shorter inventory turnaround times, the manufacturer’s cost burden is reduced.
Samsung data shows that these products are selling at a much slower pace than before. A similar trend has emerged in Samsung’s smartphone business. A recent report mentioned that Samsung has a backlog of 50 million unsold smartphones sitting at dealerships. That’s about 18% of Samsung’s estimated total smartphone shipments in 2022. Samsung has reportedly cut phone production by 30 million units in 2022.