Apple still hasn’t found anyone to run its retail operations despite the fact that it’s been nearly 10 months since John Browett was given the boot.
According to Ian Sherr and Joann Lubin at the Wall Street Journal, the company’s famous stores have struggled from the lack of leadership.
While things are returning to normalcy, Apple’s stores aren’t bringing in as much revenue as they have in the past. According to Apple’s latest earnings data, retail revenue at the company had a 22% drop, to $US4 billion, from the prior quarter. Retail revenues always drop after Christmas, of course. But sales were still flat from the year prior — despite overall revenue increasing companywide.
Apple stores are stagnating, in other words.
Here’s how bad things got under Browett, according to the Journal:
Budgets for paper, pens and other basic supplies are roughly back to their earlier levels after dropping about 30% in some stores, these people said. Other items, such as replacement T-shirt uniforms adorned with the Apple logo, still aren’t handed out to store employees as quickly as they used to be, one person said.
That’s pathetic. Apple is one of the most cash-rich companies on the planet, with $US146.6 billion in cash and marketable securities on its balance sheet. Yet somehow, it was nickel-and-diming the stationery closets!
Browett’s time running Apple drew criticism for changing the retail division’s focus from customer service to sales, which in hindsight seems unsurprising given his prior role running Dixon, a decidedly untrendy discount electronics retailer in the U.K.
What we didn’t know was the extent of his cost-cutting measures. While we knew he had cut hours in an attempt to boost profits, the Wall Street Journal story mentions that managers were told to cut costs on things like employee events, training, and meetings.
Hiring specialised workers, like the tech-savvy “Geniuses,” was slowed or halted at many stores despite the company focusing on said employees in an ad campaign that was prominently run during last year’s Olympics.
A positive way of looking at those numbers is that revenue was flat even though Apple didn’t launch a new iPad model like they did in the same time frame last year. That makes Apple’s fall numbers all the more crucial, when Apple launches a new iPhone along with the rumoured cheaper iPhone and Retina iPad Mini.
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