Beleaguered Gateway closes all retail stores; Apple poised to open 77th outlet

“Computer manufacturer Gateway announced to close its 188 retail stores in the US. The company plans to pursue its sales through its website and retail channels. The decision to return to its roots was a widely anticipated move by analysts reflecting the firm’s cost cutting strategy. ‘It is not a real surprise,’ said Martin Reynolds, an analyst with market research firm Gartner. ‘Gateway’s problem is their cost structure,'” Wolfgang Gruener reports for Tom’s Hardware Guide.

“Reynolds also sees the closure of the stores which will eliminate about 2,500 jobs as an effect of Gateway’s acquisition of eMachines. It would be more effective for Gateway to expand its presence in retail stores such as Best Buy or Circuit City, an environment eMachines is familiar with, Reynolds said,” Gruener reports. “While Gateway had trouble making the store model work, Apple took a similar approach and appears to be able to boost its sales. According to the company, Apple stores postes an 83 percent increase in customer traffic in 2003, $273 million in revenue and $9 million profit.” Full article here.

Apple Computer, Inc. recently opened its fifth flagship store in San Francisco, bringing their total to 76 retail stores which have hosted more than 30 million visitors since the first Apple retail store opened in May 2001. The Apple Store San Francisco is the company