Apple leads brick-and-mortar retail with $5,546 in sales per square foot

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Apple remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research.




By comparison, the leading food service retailer, Reis & Ivy, has $3,970 per square foot, while gas/convenience chain Murphy USA has $3,721, eMarketer noted. Even the top jeweler, Tiffany & Co., is sitting at $2,951.

Apple has nearly 500 stores worldwide, with some of its bigger locations -- like Union Square in San Francisco -- taking up multiple floors. Its per-foot performance is likely due to a combination of online and offline sales, plus the value of its electronics. An iPhone 7 starts at $649, and most Macs cost well over $1,000.

Apple has achieved higher rates in the past, such as in 2011, when it reached an estimated $5,600. The dip may be linked to an overall decline in physical retail, as CoStar research suggests the average take has fallen from $375 in the early 2000s to $325.

One of Apple's next stores will be located inside Washington, D.C.'s Carnegie Library, taking up a sizable 63,000 square feet once renovations and general construction are complete.
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Comments

  • Reply 1 of 31
    SoliSoli Posts: 10,035member
    I had to look up Reis & Ivy. Froyo seems like a huge money maker as I assume there's a general low overhead, start up fees, can operate quickly from a small location, and you can hire minimum wage staff that need very little instruction.
  • Reply 2 of 31
    lkrupplkrupp Posts: 10,557member
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    Solichristopher126Rayz2016mwhitewatto_cobrajony0StrangeDaysrandomthot2
  • Reply 3 of 31
    I'd always thought Wall Street treats Apple's retail stores as if they didn't exist. Certainly, Apple's share price doesn't go up whenever they open a new store. I always considered Apple stores as a moat for Apple which no other consumer tech company can touch or cross. I've never heard Wall Street praising Apple for the number of global retail stores like they praise Amazon for Prime membership or Netflix for subscriber membership. I would have thought Apple retail stores definitely help Apple maintain customer loyalty and work as a magnet for pulling more consumers into the Apple fold. Yet retail stores are never talked about as being such a great thing that Apple has. Apple is definitely unique in having these retail stores (well, Microsoft does have a few stores).
    calipatchythepiratewatto_cobra
  • Reply 4 of 31
    "$5,546 per square foot". . .over what period of time? I don't see where it says that.
    ivanhfred1
  • Reply 5 of 31
    lkrupp said:
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    No, I also don't get it. Wall Street sees Apple retail stores as having zero value. When Amazon opens up a new fulfillment center, BOOM, Amazon is awesome so let's pump up that share price. When Apple opens up a new retail store in a high-status location, YAWN, who cares, just more overhead, time to dump Apple stock. I really must be stupid because I'm missing how value can be measured. How something works for some companies but not others. Apple retail stores are practically the face of Apple, so they should have high value but Wall Street apparently doesn't think so.
    watto_cobra
  • Reply 6 of 31
    macxpressmacxpress Posts: 5,808member
    Thats almost as much as a Microsoft store.... /s
    SpamSandwichfotoformatcaliwatto_cobra
  • Reply 7 of 31
    mknelsonmknelson Posts: 1,126member
    lkrupp said:
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    Who said "Watch is a flop"? They've been top of the wearables class for some time now. It better better not be that Dvorak guy…

    Reconcile: 1000 units at $999 apiece, vs. 800 units at $1299 apiece

    Less units, higher price = more revenue.

    And it'll be $ per square foot per year.
  • Reply 8 of 31
    macxpressmacxpress Posts: 5,808member
    mknelson said:
    lkrupp said:
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    Who said "Watch is a flop"? They've been top of the wearables class for some time now. It better better not be that Dvorak guy…

    Reconcile: 1000 units at $999 apiece, vs. 800 units at $1299 apiece

    Less units, higher price = more revenue.

    And it'll be $ per square foot per year.
    Don't you know...Apple is doomed! Its failing across the board...they need a new CEO. /s
    Soliivanhcalimwhitewatto_cobraanome
  • Reply 9 of 31
    SpamSandwichSpamSandwich Posts: 33,407member
    macxpress said:
    Thats almost as much as a Microsoft store.... /s
    Or a Samsung Store.  /s
    watto_cobra
  • Reply 10 of 31
    linkmanlinkman Posts: 1,035member
    "$5,546 per square foot". . .over what period of time? I don't see where it says that.
    As an engineer this also drives me nuts. Since there is no time unit attached it implies that it is a one-time figure. So a 10,000 square foot store gets $55.46 million in sales and on the average it closes? I know the linked article also has no time period so it's not exactly AI's fault. In fact, the problem seems to be retail industry-wide as nearly all of the reports omit the time specification. 

    Wikipedia probably has it right -- it is most likely dollars per square foot per year. https://en.wikipedia.org/wiki/Sales_per_unit_area
    fred1
  • Reply 11 of 31
    starxdstarxd Posts: 128member
    "Its per-foot performance is likely due to a combination of online and offline sales, plus the value of its electronics."

    Why on earth would the brick-and-mortar sales figures include online sales?  How does that make any sense?  

    And what is meant by "plus the value of its electronics"?  

    What a strange sentence...
    SoliSpamSandwichRayz2016watto_cobratzm41
  • Reply 12 of 31
    starxdstarxd Posts: 128member
    lkrupp said:
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    Mac sales are hardly "slumping."  Where did you get that from?

    And Apple Watch is not only the best-selling wearable of all time, it is now among the very best-selling watches of any type.  It's a big success.  

    And iPhone sales are doing great.  Who are these "analysts" you're listening to?  Apple puts out accurate figures every quarter, so you don't have to listen to "analysts" to know how they're doing.  The fact is, they are doing incredibly well - better than any other consumer electronics company.  
    watto_cobracali
  • Reply 13 of 31
    mpantonempantone Posts: 2,040member
    lkrupp said:
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    Let's say Company A made $5800 per square foot last year and $5500 this year. Let's say Company B made $3800 per square foot last year and $3900 this year.

    Yes, Company A's retail sales per square foot dropped but they still beat Company B.

    Even if the entire bricks-and-mortar retail industry is in decline, if you are still generating more revenue per square foot than anyone else, you are still number one in that category.

    More important is profit. Apple has a high profit margin, so despite its meager market share, it is raking in the lion's share of industry profits. 

    This has been going on for maybe 12-15 years on the PC side, and certainly the last five years of smartphone sales. Even if Samsung sells a boatload more smartphones than Apple, the margins are far less.

    For PCs, Apple's overall market share is tiny, but they make something like 98% of the industry's profits in the $1000+ market, which is where almost all of their computer products are priced. Everyone else is scrapping it out for breadcrumbs.

    Likewise, for smartphones, only two companies are making a profit: Apple and Samsung. LG might still be breaking even, but basically everyone else is losing money.

    You need to learn a bit more about competitive analysis. 

    This isn't about Apple trying to beat all-time records, it is about Apple trying to do better than their competition *TODAY*.

    The Olympic gold medal is not awarded to whoever performed the best in history, it is based on a particular competition over a defined timeframe.

    I assume you have zero knowledge about athletic competitions.

    When you swim in a medal race, you are not competing against history, you just need to be faster than anyone else in that pool.

    That's what these statistics are about. Measured performance over a certain timeframe under certain criteria.
    edited July 2017 watto_cobra
  • Reply 14 of 31
    LoneStar88LoneStar88 Posts: 325member
    linkman said:
    "$5,546 per square foot". . .over what period of time? I don't see where it says that.
    As an engineer this also drives me nuts. Since there is no time unit attached it implies that it is a one-time figure. So a 10,000 square foot store gets $55.46 million in sales and on the average it closes? I know the linked article also has no time period so it's not exactly AI's fault. In fact, the problem seems to be retail industry-wide as nearly all of the reports omit the time specification. 

    Wikipedia probably has it right -- it is most likely dollars per square foot per year. https://en.wikipedia.org/wiki/Sales_per_unit_area
    Thank you, linkman, for your input. Philosophically speaking, "dropped-out time" can be an indicator of a certain degree of psychosis/stupidity.
    edited July 2017
  • Reply 15 of 31
    macxpressmacxpress Posts: 5,808member
    starxd said:
    lkrupp said:
    I always have trouble reconciling seemingly contradictory reports. Apple "remains one of the most successful brick-and-mortar retailers in the world with sales of $5,546 per square foot, according to recent research." But Mac sales are slumping, iPad sales are slumping, the Watch is a flop, iPhone sales are declining and losing market share according to analyst reports and market survey results. I guess I don't get it.
    Mac sales are hardly "slumping."  Where did you get that from?

    And Apple Watch is not only the best-selling wearable of all time, it is now among the very best-selling watches of any type.  It's a big success.  

    And iPhone sales are doing great.  Who are these "analysts" you're listening to?  Apple puts out accurate figures every quarter, so you don't have to listen to "analysts" to know how they're doing.  The fact is, they are doing incredibly well - better than any other consumer electronics company.  
    He was joking...
    mwhitewatto_cobracaliStrangeDays
  • Reply 16 of 31
    macxpressmacxpress Posts: 5,808member

    starxd said:
    "Its per-foot performance is likely due to a combination of online and offline sales, plus the value of its electronics."

    Why on earth would the brick-and-mortar sales figures include online sales?  How does that make any sense?  

    Because people order online and ship to store? Or, in the case of Apple, they reserve something in the store online and come to pick it up. 
    watto_cobraStrangeDays
  • Reply 17 of 31
    mpantonempantone Posts: 2,040member
    That's something for Apple's finance department to determine.

    Does it count as an online purchase with a will-call fulfillment or is it a retail purchase at a bricks-and-mortar store?

    I would say that the bricks-and-mortar retail staff should not get the credit for the sale, since they had nothing to do with the purchase. The bricks-and-mortar store is simply a fulfillment center at this point, no different than picking it up at a UPS distribution hub.

    One thing is for sure: Apple cannot count it as both.
    edited July 2017 watto_cobratzm41
  • Reply 18 of 31
    Rayz2016Rayz2016 Posts: 6,957member
    macxpress said:

    starxd said:
    "Its per-foot performance is likely due to a combination of online and offline sales, plus the value of its electronics."

    Why on earth would the brick-and-mortar sales figures include online sales?  How does that make any sense?  

    Because people order online and ship to store? Or, in the case of Apple, they reserve something in the store online and come to pick it up. 
    That's an online sale then, not a store sale. 
    watto_cobratzm41
  • Reply 19 of 31
    SoliSoli Posts: 10,035member
    Rayz2016 said:
    macxpress said:

    starxd said:
    "Its per-foot performance is likely due to a combination of online and offline sales, plus the value of its electronics."

    Why on earth would the brick-and-mortar sales figures include online sales?  How does that make any sense?  

    Because people order online and ship to store? Or, in the case of Apple, they reserve something in the store online and come to pick it up. 
    That's an online sale then, not a store sale. 
    I don't know. I could see an online order that you ship to the store as getting credit for the store if the 1) they pull it from their local inventory, as is often the case when we look for in-store availability, or 2) if you actually payment—not just an authorization—is rendered at the store by a store employee.
  • Reply 20 of 31
    I'd always thought Wall Street treats Apple's retail stores as if they didn't exist.
    Actually, many so called retail analysts think that brick and mortar stores are so dated that they should not exist any more. To them it is small boutiques and online.
    Some other Wall St types may see the leases etc that Apple has signed up to as a sign of their inability to change quickly. This does totally ignore the amount of business that Apple does in those 'legacy' stores.
    To the Analysts it is all about agility in business. The slow, steady and doing it right (mostly) path that Apple follows these days is totally out of kilter with their view of the world.
    Google OTOH, is constantly announcing new programmes and initiatives. Wall St see this as goodness.
    Not many of those google products last the course but Wall St don't see this as bad.

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