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Apple's Retail Division Cut 1,600 Jobs

 6:07 pm on Apr 24, 2009 (gmt 0)

The average take per store took a 17% hit, falling to $5.9 million from $7.1 million in 2008.

Apple's Retail Division Cut 1,600 Jobs [apple20.blogs.fortune.cnn.com]

[edited by: bakedjake at 9:22 pm (utc) on April 24, 2009]



 8:21 pm on Apr 24, 2009 (gmt 0)

Saw similar reports in the mean time, longer versions suggested it might be a mixing of part-time employees in with full-time ones, to confuse everything, as well as that the retail stores seem to under-perform (I guess more people buy their stuff online, or indeed other stores pushing their products too.

Also as they build more stores the stores will start to compete with themselves I guess. There are no apple owned stores where I live, all -even those that almost look like they are real are in fact independent dealers. Not that it would harm you as a customer.


 8:48 pm on Apr 24, 2009 (gmt 0)

Well, they certainly hire/fire based on forward projections, not backwards results, so the fact that they're firing (whether full or part time) means that they suspect a slowdown in their stores is on its way.

That said, they've definitely increased their retail distribution for the iPhone. I think you can buy them at Wal-Mart now in the US, which exposes the product to a new audience.

I'm not sure it's Apple so much competing with itself as Apple realizing that retail is hard and probably best left to retailers. They've gone through tremendous growth in terms of store openings over the last five years, and we'll probably see some constriction as they start to sell more and more of their product in traditional retailers.

I know it's an average, but $5.9M sounds like there are pretty tight margins in some of those stores. Think about the value of the real estate that some of those stores are located in - rent has got to be expensive. :)

Since overall Mac sales are down 3%, what will be interesting to me is what the upgrade cycle happens to be on iPhones. The iPhone threatens the normal 18 month cell phone upgrade cycle because of its cost. I'm sure Apple knows this, but the power of the iPhone could drag the upgrade cycle to computer levels - which are more like 3 years.


 10:09 pm on Apr 24, 2009 (gmt 0)

Competition probably has taken a bite out of apple and that would effect it right down to the core of the retail performance, but Im sure this restructuring is twisting the stem of the problem because as we all know, apples grow on trees.


 11:19 pm on Apr 24, 2009 (gmt 0)

After opening more than 250 company-owned stores in eight years (an average of nearly 8 per quarter and a total of 46 in 2008 alone) Apple in the last quarter opened just one.

Hold those statistics before I become seasick.

Aren't we in a global crisis at the moment? Wait - here it comes...

...one of several moves that Apple has made in response to what COO Tim Cook this week called a 'horrendous economy.'

Good - cutting costs and increasing efficiency is to be expected at this time. I guess the point of the story is that they are responding proactively in these uncertain times.


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