Apple retail outlets rake in profits

By Justin Mann on December 21, 2006, 4:21 PM
PC hardware tends to be an area where most retailers lose money or barely make a profit. Especially in the aggressive desktop market, where parts are cheap and suppliers are many. That isn't the case for Apple, who, foot for foot, is making more money than expensive jewelers, bringing in about $4,032 per square foot in their retail stores. With the culture that Apple endorses and the wide range of Apple-branded products they offer, it is easy for them to cater to their target customers. It works great, apparently:

Apple’s recipe works like crack. Apple gives customers instant gratification by keeping inventory in stores, unlike its rivals. Apple has opened its stores slowly, building up anticipation for its stores. Finally, those stores are some of the toniest in retail—encouraging customers to drop far more money than they might in a dusty computer shop or utilitarian web site.
On top of developing extreme brand loyalty, the immense popularity of the iPod and its billions of accessories have no doubt helped Apple in establishing themselves. They are blaming some of their $200 million profit on good store location, with 170 retail stores around the world, 150 of those being in the U.S.

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black_death said:
Or perhaps their profit comes from screwing buyers over? I did a little research into whether Macs are truely worth what they cost....[ downloadable form: [url][/url] ][quote]When Apple first started using Intel processors you could only get computers made by them and they could only be embedded inside an LCD monitor but now that's changed, or at least the embedded in a monitor part you can still only buy from Apple, anyways now you have the option of buying "more powerful" Mac Pros. When Apple released Boot Camp many "technology experts" bought Macs under the impression that Windows runs better on Macs instead of PCs but is it true? Well maybe if the Macs had better hardware that would be true but PC hardware is always released later on for Mac so the answer would be no. But these people can't just be making false claims, there must be some truth in it right? Maybe Macs cost less than PCs? Well let's see for ourselves: An entry level Mac Pro costs $2,121.00 and has:Intel Xeon "Woodcrest" Dual Core 2.0GHz1 GB (2 X 512MB) 667 Mhz DDR2160GB 7,200 RPM SATA 3 Gb/sNvidia GeForce 7300 GT 256 MB16x "SuperDrive"An undefined motherboardA case and powersupply[
0]It also includes an Apple Keyboard and "Mighty Mouse" (you know, that tiny cube with one button and no scroll wheel?), free shipping and options for buying Mac OSX Server Edition (if only there was some kind of Operating System that was way better at being a server and free, hhhmmmmm....), some Apple Software, and AppleCare Protection Plan "world-class support" (if OSX is the world's most advanced OS, never gets viruses, and is the easist OS to use why would one need this protection plan?). Now the average person may think $2k isn’t a lot for a computer like this but let's look at how much this computer would cost if we bought the parts individually with the help of our trusted friend Xeon "Woodcrest" Dual Core 2.0GHz - [
86] $331.99 but I don't see why they're using processors intended for servers on a personal computer (Whoops thats what PC stands for! My bad, personal mac in that case, I'll never make the mistake of calling a Mac a computer a again!) when a Core 2 Duo E6600 (2.4 GHz 4MB) is better and cheaper at $309.00? [
03]1 GB (2 X 512MB) 667 Mhz DDR2 - "Mac Memory" the DDR2 667 (PC2 5300) by Kingston [
74] is $253.99; if however you bought plain old PC memory like the DDR2 667 (PC2 5400) by OCZ [
59] it would be $105.99.160GB 7,200 RPM SATA 3 Gb/s - The Apple page didn't seem to say the how much cache the hard drive had so let's assume it was 8mb. Anyways all the "mac storage" ones seem to be external (and they cost between $181 and $209 - these prices aren't considered in the total) [
] so we'll have to go with a PC one: all the 160 GB 7,200 RPM Hard Drives with 8mb of cache cost between $54 and $65 [
vidia GeForce 7300 GT 256 MB - all the GeForce 7300 GT 256 MB cards cost between $70 and $95 [
t=ENE&SubCategory=48]16x "SuperDrive" - Too bad Apple is the only company cool enough to make a "SuperDive" but since no one can make hardware like Apple can we'll have to settle for some lowly PC equivelant, mind you the CD reading and writing (R not RW) on the "SuperDrive" is only 32X instead of the standard for the past half decade of 48-52X but that’s ok it's not like Mac is the world's most advanced OS or anything. Once again Apple has left out some details so let's assume that it's an IDE drive with 2MB of cache: all of the drives with 2MB cost between $24 and $27 [
ENE&Nty=1&SubCategory=5]Motherboard - Apple doesn't mention the motherboard included but I assume the type is changed based on requirements (i.e. how many PCIe slots, how many SATA slots, etc.) and based on our requirements (1 PCIe Slot, 1 SATA slot, Socket 775, DDR2) lets try to find an equivelant: ASUS P5L-MX Socket T (LGA 775) Intel 945G Micro ATX - DDR2 667 2 X 240pin slots - 1 PCIe x16 Slot - Retail: $75.99 OEM: $51.99 [
it=ENE&SubCategory=280]Other stuff: - There's also a few other things those being a case and a power supply, you can get a pretty good case for around $50 and based in this setup we'd proably need a 400W power supply now the prices are pretty varied but the majority of them cost between $20 and $50 with a few costing more and a few costing less. [
Total cost: Depending on many factors including whether or not you want the (overpriced) "mac" part or a PC equivelant and which OEM you get it from: [b]$684.98 - $948.97[/b]. Wow, I wasn't even expecting that much of a price gap! Assuming Apple pays around $700 for all the parts (they get it in bulk with no markup) plus the assembling they're making over $1,400 in profit per sale!Keep in mind you can also buy parts which are "open box" which will cost even less and New Egg has to make money too so they have a little markup but Apple has bulk manufacturing contracts with the companies that make the parts for their computer so they’re saving even more than any of us on parts.[/quote]This is part of an article I'm writing about Apple and Macs which hopefully I'll make into a video sooner or later. If you share my views on Apple and/or Macs or if you liked my article then you can visit my website [url][/url] where you'll find the rest of my article and other people just like you :)
peas said:
Suckers buy into Apple, and they're the ones footing the bill for those "cool" ads and Steve Jobs's exorbitant stocks/bonuses.
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