Every September for the last ten years, Apple and its most loyal customers have gone through the same ritual. Days before the new iPhone model goes on sale, thousands of eager buyers begin lining up outside Apple stores so they can be among the first to buy the new phone.

iPhone 8 Up For Auction
Image Source: Andrea Cau / Chris Burns / YouTube video (screenshot)

We pretty much know two things about the long-awaited iPhone 8, which is due out this fall. It will very likely be the best-selling iPhone of all time – and it will be in very short supply well into next year.

Apple has two main options to deal with this situation. First, it can delay putting the phone on sale until it builds up its inventory. Or, it could put the phones on sale in late September, immediately selling out its entire stock.

In ValueWalk posts this spring, I suggested that Apple could avert the anticipated iPhone 8 supply shortage by charging a considerably higher price when the phone comes out. Although Apple may be among the world’s most secretive companies, I am pretty confident that it will not be following my advice.

So now, I’m going to double down by making Apple an offer it can’t refuse – a new plan that will make millions of its customers very happy, while adding tens of billions of dollars to its profits through the fall and winter quarters.

My plan: In late September, when Apple will probably have about five million iPhone 8s in stock, it can put them up for auction. We can have a starting bid of, say $1,200, for the 256 GB phone. At that time, the company can announce that once supply shortages ease, everyone will pay a set price of $1,000.

The higher you bid, the sooner you’ll get your phone. Now if there are just five million phones available, you’ll have to bid much more than $1,200 to be sure of getting your phone any time soon.

Since so many Apple buyers have a deep-seated need to be the first to get the latest iPhones, they will be among the highest bidders. If the phones are in such short supply, they will bid whatever it takes.

Orders will be filled in accordance with the size of customers’ bids. The higher your bid, the shorter your waiting time. People bidding, say, $2,000, will probably get their phone within a week.

Initially, millions of customers will bid over $1,500 to ensure relatively fast delivery. And then, as manufacturing ramps up, bids of $1,300 or $1,400 might be sufficient.

It seems likely that supply shortages will not end until the spring of 2018. So until that time, customers will need to pay over $1,000 for their phones.

Suppose the company sold 90 million phones at an average price of $1,300. Apple will have earned an extra $300 of profit on each of these phones.

Let’s do the math: $300 x 90,000,000 = $27,000,000,000.

If my guesstimate is correct, Apple could add $27 billion to its profits by following this pricing strategy.

When the company announces lineup of new products a week or two after Labor Day, let’s see if they give me a little credit if they decide to follow my auction plan.

Full disclosure: I own Apple stock.

Steve Slavin has a PhD in economics from NYU, and has written sixteen math and economics books, including a widely used introductory economics textbook now in its eleventh edition (McGraw Hill) and The Great American Economy (Prometheus Books) due out August 8, 2017.