Apple Channel Strategy in Singapore
PROBLEMS IN APPLE CHANNEL STRATEGY
Lack of control over its ARs
Apple has done well in differentiating and gaining a tight control over its APRs. However, comparing to its APRs, there is a lacked of control over its ARs. Sales personnel in non-APRP might not have adequate knowledge and the competence as compared to those who were given intensive training in its APRP. On the whole, consumers who did not received the expected level of service at the non-APR stores will attribute the bad sale services and dissatisfaction to Apple and not to the non-APR stores. And this will ultimately reflect badly on Apple.
Apple has a tight control over its products pricing, leaving as little as only 3% of the profit margins for its resellers to gain from (Ian Fried, 2001). This clearly shows that Apple is at a disadvantage given the margin the ARs can obtain as compared to other brands (For e.g. Dell resellers can earn as high as 5% - 10% for each Dell product sold). The ARs will then prefer to devote much effort to promote competitors’ product with higher margin profits instead of Apple’s.
Acceptance of New Products
Apple is a technology driven company, its constant innovation would mean constant release of new products. The success of the new products would depend on its resellers’ willingness to carry it. Factors that come