17 Facts About The Apple Store Profit Machine

Apple's awesome new store in Paris

Photo: Apple

Apple now has 363 stores worldwide.Collectively, these stores generate a staggering $18 billion of revenue per year.

Apple’s stores also generate an astounding 26% profit margin, allowing the company to rake in $4.4 billion of retailing operating profit a year.

Apple now employs a vast number of store employees–more than 42,200 worldwide and 30,000 in the U.S. alone.

These employees work for a hip, cool company that makes them feel good about their work. But they don’t get paid much.

The average store employee helps generate about $420,000 of annual sales for Apple each year but takes home only about $25,000. (Recently, to its great credit, Apple gave some of its store employees a raise).

The disparity between what Apple makes from its stores and the amount it pays its store employees is unmatched in the retail world.  But it’s reflective of a larger problem in the economy. Many of the jobs we create are “McJobs” that don’t pay enough to live on and have little upward mobility.

David Segal of the New York Times has written an excellent article on Apple’s store business. Some of the following information comes from that article.

(This post evolved from an earlier one written by former BI editor Dan Frommer.)

Apple launched its store concept in 2000. The idea was widely viewed as nuts. 12 years and ~360 stores later, more than 1 billion people have visited Apple's stores.

Apple's stores brought in $4.4 billion of revenue in the March quarter, an astounding 38% increase over the prior year. For context, average retail sales in the U.S. are growing at about 2% per year.

85 million people visited Apple's retail stores during the March quarter, which is considerably more than the number of people who attended a Major League Baseball game in 2010 (73 million).

Apple supposedly spends $315,000 per store on wood furniture.

Overall, it costs about $1 million to build out a mall store, $8-10 million to build out an impressive store, and $20-40 million to build out a crazy-impressive store, according to ifoAppleStore.

The smallest Apple Store is at Santa Rosa Plaza in California

It's just 540 square feet.

Apple's largest retail store is Regent Street in London, which is 25,000 square feet. The Nokia store across the street went belly-up.

Data source: ifoAppleStore

Apple's Bondi store in Australia is the only one with a living tree inside it, according to ifoAppleStore.

Some sort of ficus.

Source: ifoAppleStore

About half of the Macs sold in Apple retail stores are to people who had never owned a Mac before.

It's impressive that this stat, which Apple shares during its quarterly earnings calls, hasn't changed over the years.

Apple retail is the only thing Steve Jobs would admit hiring a consultant for.

Apple has 30,000 full-time employees in its store business in the US alone. That's more than a third of Apple's total of 43,000 U.S. employees.

Apple now generates an average of $49 million of revenue per year per store. That equates to sales per square foot of a staggering ~$6,000 per year. That's more than twice as much as the next-closest retailer, Tiffany.

Apple, 42,200 store employees generate about $420,000 of sales per year apiece. That compares to $37,000 per year per employee at Best Buy.

Data source: Apple filings, Yahoo Finance.

In retailing, Apple's sales per employee are exceeded only by Tiffany, whose 9,800 employees sell $663,000 of merchandise per year apiece.

Data source: Apple filings, Yahoo Finance.

Apple's stores are more profitable than Tiffany's stores, generating an operating profit margin of 26% versus Tiffany's 20%.

But Apple pays its store employees less than Tiffany.

Many of Apple's store employees make about $12 an hour, or $25,000 a year. That's higher than the retailing average, but it still leaves them poor. It's also less than the $15 per hour Tiffany salespeople make. (But more than the $10 at Best Buy.)

Getting a job at an Apple Store can be more selective than getting into Harvard.

In 2009, Apple said that 10,000 people submitted applications to work at its new store on Manhattan's Upper West Side, according to Gizmodo's Matt Buchanan.

Of those, just over 200 got jobs, for a 2% acceptance rate.

Meanwhile, Harvard's acceptance rate was 7% that past year, according to a report in the Boston Globe. That's 29,000 applications for about 2,000 admissions.

Now check out how Apple brainwashes its store employees, turning them into gleeful, clapping zealots...

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.