All big vendors will place orders some distance into the future. Lenovo does it, too.

You can't lock in prices forever, though. The more volume and stability you have, the more a vendor will be willing to enter long-term agreements with you. Lenovo has less volume than Apple and is not in as great of a financial position, so they don't have as much leverage.

The bigger factor is that Apple already had more margin in their products. The price premium for RAM upgrades on Apple laptops is large, as everyone knows. They could absorb more RAM price increases without being forced to raise retail prices.

> If lenovo is buying a billion chips a year, why can’t they lock in like Apple?

Lenovo controls less of the stack than Apple: CPUs (Intel/AMD), BIOS, operating system, etc. While ostensibly Apple and Lenovo are both selling personal computers, Lenovo is in a (sub-)segment of the market that is commoditized with Dell, HP, etc.

If you need to run Windows and associated (Windows-only) apps, what's special between Lenovo/Dell EMC/HP/etc? How much of a difference is there between Coke and Pepsi?

A lot of vendors hitched their wagon to the Wintel duopoly, and now they're all riding (or being ridden) herd.

I really don't understand why more companies don't emulate Apple in terms of line simplicity. Look at Dell for a great example of a sprawling product mix. I can't imagine having that many product varieties helps with profitability.

In the consumer space, I recently bought a Sonicare toothbrush, and the number of models and combinations is staggering. 1000x plaque removal, 750% plaque removal, it's ridiculous.

They can lock in. However that is risky too - if prices go down they are locked into the higher prices.

More importantly, if you have a locked in price you can sell your products for more profit - or you can sell the things that you have locked in and not have to make the rest of the widget at all. Sometimes someone will give you a good deal to buy out your locked in contract.

Because people continuously underestimate just how good Apple engineering and supply chain management is. And since iPhone and portables is such a juggernaut for them, it goes downstream into every other product line that uses the same architecture. That’s why it was so critical for them to pull off the ARM MacBook transition - the only other alternative for them essentially would have been to exit the market or run mostly at a loss.

Because Apple has the capital to take a loss on hardware indefinitely due to the App Store being their primary source of revenue?

Do they have anything like the same volume? Lenovo’s annual revenue is about half of Apple’s annual profit.