‘Short List’ Of Locations For First Indian Apple Store Has Been Finalized
Just weeks after Apple slashed iPhone prices in India and China (with price cuts in other emerging markets still to come), Bloomberg reports that Apple has finalized a short-list of locations for its first retail store in the country.
Right now, Indian consumers must buy their iPhones through third-party retailers or from Apple’s Indian website. But soon, well-to-do consumers in Mumbai will be able to experience the peculiar retail experience of wandering through an austere cube of a storefront filled with impossibly expensive gadgets.
Per Bloomberg, the spots under consideration are comparable to the Fifth Avenue Apple store in terms of local retailing prestige (though let’s hope, for customers’ sake, that the store doesn’t grapple with the same bed bug issues).
The vetted spots are comparable to iconic Apple locations on Fifth Avenue in New York, Regent Street in London or the Champs-Elysees in Paris, they said. Apple has been prohibited from opening its own stores in the country because it doesn’t meet local sourcing requirements, but it’s shifting manufacturing into India and is in talks with the government about its retail expansion.
The expansion into India is particularly important for Apple’s future revenue growth. Though the trend of slowing sales in China moderated during Apple’s fiscal second quarter, given all of the trade war uncertainty and Chinese consumers’ patriotic preference for Chinese brands like Huawei and Xiaomi, Apple still needs to find a new flagship foreign ‘growth market’. And what better choice than India, which has eclipsed China as the fastest-growing smartphone market in the world?
To boost its retail presence, Apple must alsoboost manufacturing in India, and not just because of tariffs: The Indian government has strict sourcing requirements, something Apple is in talks to address.
Already, Foxconn is running quality tests right now, and is planning to open manufacturing facilities that will work on newer models in the suburbs of Chennai. It already operates a factory working on older models near Bangalore.
The Cupertino, Calif.-based company has struggled to establish itself in India where consumers have opted for less expensive Chinese brands such as Xiaomi and Vivo. But Chief Executive Officer Tim Cook has vowed to improve in the fast-growing market, especially as Apple loses ground in China. Manufacturing in India will also allow the company to sidestep 20 percent tariffs on imported phones, making its devices more competitive.
“India is a very important market in the long term,” Cook said after the company’s earnings report last week. “It’s a challenging market in the short term, but we’re learning a lot. We plan on going in there with sort of all of our might.”
Plus, after floundering for years, Apple’s share of the Indian smartphone market can really only climb: Research firm Canalys estimates the company’s shipments fell by more than 75% in the first quarter of 2019, giving it only about 1% of the country’s smartphone market.
Opening its first store would be one way to give the launch of the next-generation iPhone a little more ‘oomph’ in India.
However, if Apple truly wants to grow its market share in India, there’s really only one way to make it happen: More price cuts.
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