(Nikkei BP Group)
(No.1 High-Tech News Site in Japanese)
| Uniform iMac Sales Method Prevails at Stores: Apple Japan Director
February 18, 1999 (TOKYO) -- Apple Japan Inc. has introduced the new
iMac PC in five colors and the G3 machine in blue and white, and the
speed of those introductions has been brisk, a company official said.
|The new PCs have been marketed since the Jan. 5 announcements at the
MACWORLD Expo/San Francisco.
Is the new distribution system, which was introduced for the first-generation
iMac, working effectively? To get an answer, Nikkei MAC interviewed
Naohisa Fukuda, director of business operations (and responsible for
the distribution system).
Nikkei MAC: Apple Japan has established a distribution system
that enables it to control shop inventories. Is the new system working
Fukuda: In October 1998, the first-generation
iMac was replaced with the iMac, Revision B. The market conditions at
that time and now are quite different.
In October last year, we sought to reduce inventories of the first-generation
iMac at retail stores. Since we knew exactly where the inventories were
located and their unit volume, Apple Japan successfully replaced all
inventories at the right time so as to ship the Revision B iMacs.
Apple Japan was able to do this because we initially limited the amount
of inventory. It would have been extremely difficult if retail stores
had held five to six weeks worth of inventories, as they previously
During that time, some stores may have run out of iMacs. However, I believe
it was only for a short period. We worked hard to avoid running out
of iMacs at stores so as to safeguard our business opportunities.
Retailers, which now have inventories representing only several days
of sales, may complain about a short supply of products, because they
were accustomed to operating with more than a month of inventories over
a long period. However, once they become familiar with the current method,
we believe that the complaints will be minimal, or even disappear.
This year, we haven't tried to replace the entire stock with the iMac
in five different colors. Also, we hoped to market the Revision B model
(in bondi blue) even after shipments of the new iMac. Because of this,
we are not too concerned with inventory adjustments at retailers.
There may still be some shops with the model in bondi blue. However,
we believe the model will be in great demand since the price was cut
by 50,000 yen (US$420).
Nikkei MAC: Apparently, Apple Japan is giving detailed instructions
on the proper way to display iMac PCs. What is the idea behind that?
Fukuda: Apple Japan has a consistent display alignment, such as
the sequence of the five colors, and we show it on TV commercials as
well as in other advertisements.
If retail stores can follow that display alignment, it will help multiply
the effect of advertisements while also boosting user recognition. It
is for this reason that we instruct all retailers to adhere to the recommended
Nikkei MAC: Retail prices and store displays are important factors
for retail stores to differentiate their services. Shouldn't retailers
have the right to decide on displays? And there appears to be a certain
limit on the number of iMacs that retailers are allowed to purchase,
is that correct?
Fukuda: Apple Japan decided upon a unified method of services
Formerly, some retailers did purchase large amounts of merchandise based
on their expectations. However, their expectations were not always met
by market demand, and then they had a painful time in reducing inventories.
This was a high-risk, high-return business model.
The iMac's profit margin is very small. However, retailers are less likely
to end up with an oversupply of goods because the amount to be shipped
is controlled by the maker. This is a low-risk, low-return business
Apple Japan wants retailers to avoid excessive competition. And although
high returns may not be expected, retailers are likely to see stable
business. This is another reason why we recommended the same price and
exact display alignments. All retail stores that became iMac promotion
shops understood our corporate policy.
When retailers purchase iMacs, they are not allowed to specify the colors
that they want. This is because we have no idea which colors will be
Since our announcement on the five new colors, Apple Japan has received
many inquiries from potential customers who want to see all five colors
on display. Thus, at least for a while, we judged that it is best to
display them all and keep the five colors in stock.
Nikkei MAC: Is Apple Japan gathering information directly from
Fukuda: We collect information from retailers. However, direct
information from users and prospects is highly valuable.
Apple Japan is now on solid ground, which enables us to efficiently collect
such information. For example, we have increased the number of telephone
lines for the customer information desk, so as to answer as many inquiries
Our judgments aren't based entirely on information received from people
who contact us, but Apple Japan does consider such information to be
Today's Apple Computer is very well prepared to quickly grasp market
needs and to take necessary steps to ensure success. Many of our staff
members are highly experienced, and we are well positioned for the future.
� Apple Japan to Continue Selling First-Generation iMac PC
� New iMac Model Sells Well in Japan, But Retailers Complain
<Visit News Center for more Asian news.>