Apple retail commitment, head-count surge over 55 percent
With its total store lease commitments fast approaching $1 billion, Apple Computer has no plans to slow development of its extremely successful retail segment and will utilize approximately $360 million in capital expenditures during the 2007 fiscal year to facilitate new store openings.
That represents an 80 percent increase over fiscal 2006, when it spent $200 million to open 41 new retail stores, including a total of 10 international stores in the U.K., Japan, and Canada. During that same time, the company's total retail lease commitments also rose from $609 million to $887 million.
Since its inception in 2001, Apple has spent over $729 million on its retail store strategy, including the construction of eight elaborate "high-profile" or flagship locations that function as vehicles for general corporate marketing, corporate events, and brand awareness.
By the end of its 2006 fiscal year on SeptemberÂ*30, the Cupertino, Calif.-based company operated 165 locations comprised of more than 1.2 million square feet of retail space. Included in that mix are 147 stores in the U.S. and a total of 18 additional stores spread across Canada, Japan, and the U.K. That compares to 124 open stores as of SeptemberÂ*24, 2005 and 86 open stores as of SeptemberÂ*25, 2004.
The fastest chain in the history of retail to reach the $1 billion mark for sales, Apple's retail segment continued to reflect phenomenal growth during fiscal 2006. Net sales increased by 43 percent to $3.4 billion compared to 2005, including an increase in Macintosh unit sales of 45 percent to nearly 900,000 units.
With an average of 142 stores open during fiscal 2006, average revenue per store also increased to $23.6 million compared to $22.4 million during 2005 and $15.6 million in 2004. Apple attributed the increase in sales to "strong sales of Macintosh portable and desktop products, iPods, and other music related products and services."
"Sales of iPods increased primarily due to the introduction of the updated iPod with video-playing capabilities in OctoberÂ*2005 and the iPod nano during SeptemberÂ*2005," Apple said in a filing with the Securities and Exchange Commission. "Macintosh portable and desktop sales increased due to strong sales of the Intel-based MacBook, MacBook Pro, and iMac."
Shoppers flood Apple's flagship retail store on Fifth Avenue in Manhattan this past October
The increased traffic at company stores also sparked a more than 57 percent rise in retail employee headcount, as Apple added 2,114 to its store staff during fiscal 2006, bringing the total to approximately 5,787. That's more than a quarter of the company's employee base, which as of SeptemberÂ*30, 2006 was estimated at 17,787 full-time equivalent employees and an additional 2,399 temporary equivalent employees and contractors.
Among the many forthcoming Apple retail outfits slated for 2007 are the first two retail stores in Scotland, and new flagship locations in both Paris and New York City.
That represents an 80 percent increase over fiscal 2006, when it spent $200 million to open 41 new retail stores, including a total of 10 international stores in the U.K., Japan, and Canada. During that same time, the company's total retail lease commitments also rose from $609 million to $887 million.
Since its inception in 2001, Apple has spent over $729 million on its retail store strategy, including the construction of eight elaborate "high-profile" or flagship locations that function as vehicles for general corporate marketing, corporate events, and brand awareness.
By the end of its 2006 fiscal year on SeptemberÂ*30, the Cupertino, Calif.-based company operated 165 locations comprised of more than 1.2 million square feet of retail space. Included in that mix are 147 stores in the U.S. and a total of 18 additional stores spread across Canada, Japan, and the U.K. That compares to 124 open stores as of SeptemberÂ*24, 2005 and 86 open stores as of SeptemberÂ*25, 2004.
The fastest chain in the history of retail to reach the $1 billion mark for sales, Apple's retail segment continued to reflect phenomenal growth during fiscal 2006. Net sales increased by 43 percent to $3.4 billion compared to 2005, including an increase in Macintosh unit sales of 45 percent to nearly 900,000 units.
With an average of 142 stores open during fiscal 2006, average revenue per store also increased to $23.6 million compared to $22.4 million during 2005 and $15.6 million in 2004. Apple attributed the increase in sales to "strong sales of Macintosh portable and desktop products, iPods, and other music related products and services."
"Sales of iPods increased primarily due to the introduction of the updated iPod with video-playing capabilities in OctoberÂ*2005 and the iPod nano during SeptemberÂ*2005," Apple said in a filing with the Securities and Exchange Commission. "Macintosh portable and desktop sales increased due to strong sales of the Intel-based MacBook, MacBook Pro, and iMac."
Shoppers flood Apple's flagship retail store on Fifth Avenue in Manhattan this past October
The increased traffic at company stores also sparked a more than 57 percent rise in retail employee headcount, as Apple added 2,114 to its store staff during fiscal 2006, bringing the total to approximately 5,787. That's more than a quarter of the company's employee base, which as of SeptemberÂ*30, 2006 was estimated at 17,787 full-time equivalent employees and an additional 2,399 temporary equivalent employees and contractors.
Among the many forthcoming Apple retail outfits slated for 2007 are the first two retail stores in Scotland, and new flagship locations in both Paris and New York City.
Comments
http://www.redherring.com/Article.as...+Beat+Tiffany#
Melgross check this out:
http://www.redherring.com/Article.as...+Beat+Tiffany#
I read that article before which is why I noted that we did have some info on sales and per store, and per foot numbers.
But we don't have a comprehensive listing of the competition.
Where does Apple rank in these areas? Who would be their closest competitor? How are their sales and profits moving compared to the industry as a whole? Etc.
Come on, Apple Store Dubai ... everyone knows how Jobsian that whole city is getting these days!
http://en.wikipedia.org/wiki/Dubai
I'm weighing in at 2B.
That, X.5, CS3, growth of portable market etc.
With potential iPod phone and smart phone products to sell as well as the 'iTV', I can see the traffic footprint of these stores surging.
With bottom line knock ons and for Macs to head towards maybe even 3 million in the next year.
Lemon Bon Bon
What about Europe?
What about Europe?
Read the article!
There's already stores in London, Scotland is coming and so is Paris.
I think with 40 plus new stores(?) in 2007? Or over 200 stores in total will contribute to Apple easing over the 2 million Mac sales mark as an average and head towards 2.5 million.
That, X.5, CS3, growth of portable market etc.
With potential iPod phone and smart phone products to sell as well as the 'iTV', I can see the traffic footprint of these stores surging.
With bottom line knock ons and for Macs to head towards maybe even 3 million in the next year.
Lemon Bon Bon
I think it will be more than 40 stores if the new capital budget is correct. Unless much of that budget is related to old store refurbishing
What about Europe?
Where?
I hate to be the fart in the soup, but I really doubt Apple is making a big profit. I live in So Cal and our Apple Stores are located in pretty much high rent district. During the summer, there are lots of ppl in the stores but hardly anyone is buying anything. The past holiday must have boosted sales but any other time of the year, I hardly see the register "ch-ching"...I think they should cut back on new stores or else they will be filing for chapter 11 soon.
They make about a 5% profit on their retail operations, which is considered to be good.
Don't forget that that profit is exclusive of the profit made on the goods they sell.
Because they mostly sell their own goods, accounting rules specifify that the profits go to the division of the company from which they come. Apple accords most of that profit back to the non store divisions.
Yes, it's complex, but it works.
...I think they should cut back on new stores or else they will be filing for chapter 11 soon.
Death knell, beleageured, etc. Blah.
The Austin Apple store is often so crowded that it stinks. Too many bodies. Can't even get to anything to demo. They need to double it in size, soon.
Read the article!
There's already stores in London, Scotland is coming and so is Paris.
Good response! You're right, I forgot to read the article. Are you for real?
Here's the countries you just mentioned;
Now, here's what I mean;
Not one of these countries has an Apple store!
Do ya folla?
I dont know much about big finance, but if I ran the Company, I'd continue with the
Apple Product line in all Best Buys, CompUSA and move them into Wal-Marts, Circuit Citys,
too. Retail space is sooooo expensive and I nver saw an Apple Store in the ghetto or crappy
parts of town.
ok, I 'm just a stupid Mac-using network tv editor (w/ 2 emmys, hehehe) SO
I dont know much about big finance, but if I ran the Company, I'd continue with the
Apple Product line in all Best Buys, CompUSA and move them into Wal-Marts, Circuit Citys,
too. Retail space is sooooo expensive and I nver saw an Apple Store in the ghetto or crappy
parts of town.
I imagine they locate their stores according to whatever their demographics tell them is the right location. The typical Apple customer, according to where the stores are located, are middle-to-upper class and they like The Gap.
I'm preparing a new post...
That's a lot of pretty colors. do they mean anything?