This week we ran a flash sale on the Propeller 1 Project Board USB (#32810) as shown above and it made one customer nervous about future supplies of the Propeller 1 Multicore Microcontroller. This customer uses the P8X32A-Q44 in a production project and asked me the following:
Hi Ken: Thanks for that flash sale! I've been buying bunches of P1/USB (#32810) now and then but that new low price was extra incentive. And I see you sold half of the 1000+ that were left. I did my part 😉
May I ask what the plans are with the Propeller 1? It seems you're putting it to bed. I can understand if that's true, but if you have any comments I'd appreciate hearing. I was sad when the P1/Mini (#32150) went away; that was such a nice form factor. Happy Parallax customer since the mid 90's...
The Propeller 1 Multicore Microcontroller is the core of our product line. You may have seen my short video in the Spring that mentioned how Parallax will be focusing very closely on our educational business and our Propeller 1 and 2 Multicore Microcontrollers.
The Propeller 1 and 2 are comfortably manufactured in the world’s most productive semiconductor facilities (TSMC in Taiwan, and OnSemi in Oregon, respectively). There is no supply limitation to our customers. We have built a business on these chips and intend to offer them until there is no demand.
To make my point more clear, I would like to provide two examples. We still manufacture the BASIC Stamp 1 from 1993. That product is 30 years “old” but it is still used in production in different applications. We continue to build these because you buy them. Additionally, in 1997, we had to announce an end-of-life to the SX 50 MIPS microcontroller due to a patent lawsuit well beyond our control. The SX was not our design, but we were able to take control of the product line and offer 25 more years of supply to our customers. We invested heavily in inventory to support you.
Parallax has been productively in business for 36 years and we plan to be here for many more. There are no concerns about the supply of our chips. You will see many posts from me about the Propeller 1 and 2 being in full production.
Thank you for posing the question, Happy Customer!
Sincerely,
Ken Gracey
Parallax Inc.
P.S. If you are interested in the Propeller Project Board USB flash sale that concerned the Happy Customer — and the business reasons behind it — I’ll explain with full transparency because I love business cases and there are no secrets to our business.
We have been manufacturing the Propeller Project Board USB in China for many years. The minimum order quantities (MOQ) were a significant 1,000 units and our costs were creeping up over recent years to about $22/board, plus new tariffs imposed by our government and higher delivery costs. These costs had slowly tripled and made the product far less viable. These high costs also forced our retail price up high enough that you bought less boards and the MOQ was a three-year supply. Customers wouldn’t buy enough boards at the new price.
As a business person, I never want inventory turnovers that take three years like the Propeller Project Board USB. Therefore I decided to turn some of that inventory into cash, and we sold 550 Propeller Project Board USBs in a single day. We have around 500 left that’ll trickle out at their regular sale price (it’s still a great deal!) and then we will discontinue this board unless we decide to make an updated version in Rocklin, California. That decision can be kicked down the road because we have some big manufacturing decisions in front of us in the near future.
Incidentally, we are on-shoring assembly of every Parallax-designed PCB into our Rocklin, California manufacturing plant at this stage. Thank you for your support!
