“As vacancies increase and retail sales throughout the U.S. remain a shadow of the decade’s boom, Apple Inc.’s stores are defying the recession,” Allison Abell Schwartz and Oshrat Carmiel report for Bloomberg.
“Apple, based in Cupertino, California, increased revenue at its stores by 2.5 percent in the first six months of the year to $3 billion as the rest of the retail industry suffered. During the same period, sales at all U.S. retailers fell 9.2 percent compared with the first half of 2008, according to the U.S. Commerce Department,” Schwartz and Carmiel report.
“Apple’s store performance in the last year has been driven by the iPhone, according to Charlie Wolf, an analyst who covers Apple at Needham & Co. in New York. The retail operation saw a 22 percent increase in traffic during the quarter ended June 27, hosting a total of 38.6 million visitors, Chief Financial Officer Peter Oppenheimer said on a conference call in July,” Schwartz and Carmiel report.
“Apple’s Fifth Avenue emporium probably has annual sales of more than $350 million, topping any of the chain’s other outlets, said Jeffrey Roseman, executive vice president of real- estate broker Newmark Knight Frank Retail in New York. The location is 10,000 square feet, putting its sales per square foot at a minimum of $35,000, based on Roseman’s estimate,” Schwartz and Carmiel report.
“That’s the equivalent of selling one Mercedes-Benz C300 sedan per square foot,” Schwartz and Carmiel report. “Apple may be the highest grossing retailer ever on Fifth Avenue, said Faith Hope Consolo, chairman of the retail leasing and sales division at Manhattan-based Prudential Douglas Elliman Real Estate. Apple doesn’t disclose store-specific revenue, said Amy Bessette, a spokeswoman at the company.”
Schwartz and Carmiel report, “By comparison, the sales floor at Tiffany & Co. sells as much as $18,000 per square foot, Consolo said. Another famous Fifth Avenue jeweler, Harry Winston Diamond Corp., sells between $12,000 and $13,000, she said.”
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MacDailyNews Take: “I give them two years before they’re turning out the lights on a very painful and expensive mistake.” – David Goldstein, Channel Marketing Corp. President, remarking on Apple’s launch of retail stores, May 21, 2001