Apple Inc.(NASDAQ:AAPL) is busy adding new products to
its portfolio, but number of retail stores opened by the company has not kept
pace with the rise in its product line-up, according to a report by Needham
& Company.
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The number of Apple stores is few and far between,
when one compares the number of products and the frequency with which the
company launches new products. This is one major reason why Apple stores always
see long queues which new products such as an iPad or an iPhone are up for
sale.
However that does not mean that the company’s points
of sales are few. Both the number of Apple Stores and the number of other
outlets where buyers can get Apple products is increasing rapidly, Wolf notes,
meaning that Apple retail stores can't keep pace with the growth of Apple's
revenue overall.
Needham analyst, Charlie Wolf, who has pointed out the
scarcity of Apple stores, said that the company is continuing to expand its
range of points-of-sale rather than its own stores.
"With ever more places to buy Apple products, the
need to specifically visit an Apple Store for purchases has been diminished.
Nonetheless, the retail stores continue to show strong growth even in a dour
economy."
According to the analysis by Needham, Apple stores
have seen sales growth at an annual rate of 18 percent over the last ten years,
while sales of non-Mac products have risen 25.5 percent.
Sales of Macs themselves have seen a growth of 12
percent, quite a creditable performance considering that PC sales are seeing
depressed demand.
According to Wolf, same store sales rose 5.4 percent
in the company's fiscal fourth quarter, up from 3.2 percent growth seen in the
June quarter.
Although the idea is right in this analysis, the causality/conclusions are wrong.
ReplyDeleteApple WANTS there to be insane lineups at the stores, as it makes them look a lot more popular and a lot more cool, thus attracting more people to the brand.
Think of discotheques. They purposely-create lineups outside, causing people to think that they are very popular (due to overcrowding inside). When you actually buy admission and go inside, you see that they are half-empty (if that) quite often. It has always been about marketing an image for Apple and its products.