Apple unwraps long-awaited retail plan

Will open 25 stores this year

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Updated Apple has launched its chain of High Street retail outlets with the promise that it will open 25 stores across the US throughout the year.

As the Mac maker confirmed last week, the first store to open will be at Tysons Corner, McLean, Virginia, and it will go live on Saturday. So too will store number two, in Glendale, Los Angeles.

The LA area will get three more stores in the coming months: South Coast Plaza, Irvine; Colorado Boulevard, Pasadena and Fashion Isle in San Fernando, according to MacCentral.

The rest of the 14 sites announced today are Valley Fair San Jose University, Palo Alto, Birmingham, N. Michigan Ave Chicago, Lincoln Park, Woodfield, SoHo, Westfarm Hartford.

Eleven more stores will be opened by the end of the year, and though the next stores will open in six to eight weeks' time, Apple promised to open one store every ten days.

The shops themselves will carry the full Apple range of products plus third-party software (over 300 titles) and peripherals, all split into Home and Pro sections of the store. A Solutions area will showcase consumer-oriented applications, such a home-movie editing and custom CD burning, that highlight Apple's Digital Hub strategy. The Genius Bar will feature experts ready to help with tech support queries.

Apple's motivation behind the launch is to target the 95 per cent of the population that doesn't own a Mac.

Says Apple: "Apple currently has around five per cent market share in personal computers. This means that out of one hundred computer users, five of them use Macs. If only five of those remaining 95 people switch to Macs, we'll double our market share."

Some analysts have questioned whether that's a viable move. They expect the majority of the stores' visitors to be Apple's existing customer base. And unless the company can bring in big numbers, the stores may easily prove more of a liability than a benefit.

"I give them two years before they're turning out the lights on a very painful and expensive mistake," said David Goldstein, president of researcher Channel Marketing, according to BusinessWeek.

However, Apple CFO Fred Anderson said he expects the stores to break even this year and have a small but positive impact on earnings in 2002.

And they won't hit Apple's reseller network either. "Our stores represent less than one per cent more additional businesses," said CEO Steve Jobs. "Our strategy is not to put our resellers out of business. Our strategy is to work side by side with our resellers." ®


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