The lure of an Apple Store can be so great that local authorities are doing all they can to sweeten the deal for the worlds biggest technology company, waiving rents and taxes in order to have it set up an Apple Store in their area.
Over the past decade, the Seattle area company has watched Apple make its brand synonymous with a signature aesthetic and one on one training in its more than 300 retail stores.
New Yorks Grand Central Terminal wanted Apple so bad it dropped its leasing fees and in Salt Lake City, authorities are rumoured to have dropped rents completely, to incentivise the opening of a new Apple Store.
The largest Apple Store in the world is in New York, Grand Central Station.
Apples retail dominanceAs a business, Apples retail stores are booming.
A staggering 71 million customers visited Apples retail stores between January and March, an increase of 28 million from a year earlier.
Under the leadership of Ron Johnson, the former Senior Vice President of Retail Operations, the Apple Stores have been responsible for ” the boring computer sales floor into a sleek playroom filled with gadgets”.
Apples impressive footfall is proving to be a catalyst for retail spending in the areas in which they are located, pushing the money spent back into the local economy.
A recent ABC News report states that Apple is going to open a new store in Salt Lake City, located in City Creek.
The company already has one store in the the Utah city but thanks to what appears to be a massive retail incentive, it may open a new store before the end of the year.
The company doesn’t appear on track to meet that goal, as it currently has just five retail stores on the Chinese mainland — two in Beijing and three in Shanghai.
According to ABCs sources, City Creek has offered a major concession package that is thought to include five years free rent.
The truth is, realtors and local authorities know that when an Apple Store is opened in an area, tech savvy consumers come from surrounding areas to view products, seek help and spend money on luxury electronics.
While authorities will never confirm it even City Creeks Marketing Director said it does not release the terms of its leases Apples lease for its impressive store in New Yorks Grand Central Terminal is a third of that paid by other retailers and restaurants in the area.
In fact, the lease is costing Apple $60 per square foot, where other retailers are expected to pay $200 for the same area, and it has escaped having to share any of its revenue with Grand Central’s operator, the Metropolitan Transportation Authority, according to papers obtained by the New York Post.
In just seven weeks, Apples newest New York store helped one restaurant boost sales by 7 percent impressive as its already co owned by basketball legend Michael Jordan.
That restaurant The Steakhouse directly attributes its increased footfall to the nearby Apple Store with its other co owner stating: “The jump only happened after Apple opened.
Now, it is preparing to open its first New Jersey location on the second floor of the Bridgewater Commons mall, right down the corridor from an Apple Store.
Many people who work in an Apple Store were One to One customers.
As of January 2012, Apple operated 363 stores and has opened a small number since then.
Local reports suggested last July that Apple had signed leases to build stores at The MIXC and Raffles Square developments in Chengdu.
Meanwhile, revenue at stores open at least a year — a comparison used to measure a retailer’s health — fell 18.9 percent.
In March, we told you new stores were coming to Germany, Spain, Australia, and Frances Burgundy wine region, and several reports this week confirmed a handful of new locations for the United Kingdom, France, and Canada.
Many stores feature a Theatre for presentations and workshops and a Studio for training with Apple products; all stores offer a Genius Bar for technical support and repairs, as well as free workshops available to the public.
However, the company isnt completely satisfied with its operations, and has brought aboard former Dixons Chief Executive Officer John Browett to drive its retail business forward.
Tim Cook has said that the Dixons exec will bring Apple to an even higher level of customer service and satisfaction.
It is about customer service and giving customers what they want, when they want.
Part of this plan apparently involves automating its sales processes, which includes investment in its Personal Pickup service, which allows customers to buy products online and pick them up from their local Apple Store.
For Saks, it provides an opportunity for better relationships with customers and to make better use of inventory because it can be varied across channels, specifically in store and online.
Apple also launched a new iOS payment service called EasyPay, providing a simple way for customers to enter an Apple Store and pay for their purchase using their iPhone, without having to seek assistance from a sales clerk.
The company is set to release a new iPhone and update its range of Mac computers in the coming months, no doubt incentivising Apple fans to return to their local store to check them out.
The stores sell Macintosh personal computers, software, iPods, iPads, iPhones, third party accessories, and other consumer electronics such as Apple TV.
As it stands, the company is setting the standard for retail, with other technology companies including Microsoft rushing to open similar stores and build rapport and most importantly gain trust from their customers.
Apple might be benefitting from its success, in terms of the money it saves from leases, but companies in the vicinity of an Apple Store dont seem to mind.
Its difficult to complain that a company is getting preferential treatment when it helps boost your own revenues and increase the number of people coming to the area.
Richard Gates is a business journalist based in Seattle, Washington. Richard has a passion for financial markets and breaking news stories and loves writing about business news, stock market, and economic opinions that matters most to its audience. Richard spends a lot of time discovering and researching latest financial markets and industry news stories in order to make sure the latest and greatest stories are brought to you first on BigBoardNews.com.