(Nikkei BP Group)
(No.1 High-Tech News Site in Japanese)
| Only Retailers with Skillful Sales Staff to Sell iMac: Apple Japan's Director
August 27, 1998 (TOKYO) -- Only retailers with skilled sales staff will
be able to sell the new iMac, according to an Apple Japan Inc. executive.
|Nikkei MAC, a magazine published by Nikkei Business Publications Inc.,
interviewed Naohisa Fukuda, director of business operations at Apple
Japan, on the domestic sales strategy for iMac, a new personal computer
model for consumers that has been selling briskly in the United States.
Nikkei MAC: Apple Japan announced its tie-up with Shimamura Music
and Ado Electronic Industrial Co., Ltd. on sales of iMac in Japan. We
will be able to buy it from other retailers as well?
(photo): iMac will be sold exclusively at retailers which tie up with
us on sales of the product. As of now, we revealed only Shimamura and
T. Zone, directly operated shops of Ado Electronic Industrial. We are
currently negotiating with some other retailers, too. I think we will
announce some more retailers for iMac before the model hits the shelves.
Nikkei MAC: Why are you going to limit the number of retailers
which will sell the iMac?
Fukuda: First of all, let me tell you about current conditions
of the personal computer industry in Japan.
Since the Windows 95 operating system hit the market, PCs have been sold
as a home electric appliance. Unlike other home electric appliances,
however, in reality, not everyone who bought a PC can operate it as
he or she likes. Many of them had to give it up.
In this sense, Mac was not an exception. Actually, not a few of those
who purchased our Performa model failed to manage it, and they have
hardly touched it. We believe that has promoted a sense of mistrust
among our users, in other words, a fixed idea that they can in no way
manage it. And that has created a situation in which PCs have not been
selling well in Japan.
We did not want to repeat the debacle with iMac. We want our users to
really handle the model as they like. That's why we need to give them
apt advice on what they can do with their PC. We also place great importance
on our follow-up services to our users. We believe we will make the
same mistake again unless we sell iMac at retailers which can realize
all of these things.
We would like to sell iMac only at shops which have skillful sales staff
who have a deep understanding of the product and make some solution
proposals to customers.
Since iMac is a PC designed for consumers, the staff will have to explain
in detail to entry-level users for what and how consumers can use iMac.
It's not that all shops of Shimamura and T. Zone will handle iMac. At
this stage, we acknowledge only a dozen of Shimamura's shops and four
T. Zone shops as retailers of sufficiently high level. We plan to cooperate
with the two retailers to improve the skills of sales staff and sell
iMac at more of their shops.
Nikkei MAC: Have you approved MacMasters as a retailer of that
Fukuda: The quality of MacMasters has been falling as the time
goes by. As you know, prices of PCs are falling. But unfortunately,
distribution channels in Japan have not changed as prices go down. Consequently,
neither retailers nor PC makers can make sufficient profits out of PCs
And that indicates our inability to make investments for the future.
We understand the lowering of the quality at many MacMasters is a structural
If we do not change anything, the whole PC industry will be ruined. I
think both PC manufacturers and retailers have to change, although the
change has to involve some distress. We would like to construct a new
business model to revitalize the entire industry with the debut of iMac.
Fortunately, Apple Computer Inc. of the United States has been changing
under the leadership of Steve Jobs. One of his results is the development
of iMac. Because we will ship such an attractive model, we would like
to review distribution systems and the way retailers are, and I think
we can do it.
In the United States, Apple can offer iMac for a low price of US$1,299
as a result of their cost-cutting efforts, coupled with their reform
of distribution channels. It is not a result of reducing parts and assembly
costs. Therefore, we will not be able to provide our users with the
model for a comparable price unless we take a similar measure.
Nikkei MAC: Many retailers selling Mac models are currently accepting
reservations for iMacs. However, do you mean that some of them will
not be able to actually sell the product?
Fukuda: You are correct. They accept reservations at their own
discretion. Unless they are approved by us as a retailer with sufficient
product knowledge, they will not be allowed to sell iMac.
Nikkei MAC: Who are your target users?
Fukuda: There are three types of target users. First, we will have traditional
Mac users. Second, we will gain some Windows users. We would like to
sell iMac to those users who understand the value of iMac at T. Zone
and any other potential retailers that we will tie up with in the future.
We want retailers to sell iMac not only in the Mac section of their
shop, but also in the Windows section.
Third, we will regard those who have never been interested in PCs as
a highly important user bracket. We expect Shimamura Music to explore
this type of potential user. Other than Shimamura, we hope to tie up
with any retailers which can draw out and promote the appeal of iMac
to those other than existing PC users.
Nikkei MAC: What about distribution channels?
Fukuda: The iMacs will be transported to Japan from a plant in
Singapore by air almost every day. After customs clearance, they will
be directly transported from the airport to each shop. In this way,
we can cut significantly the distribution process to consumers.
There will be no conventional distributors involved in the process. Each
shop will have inventory only for a few days. If shops place orders
to maintain the same number of units as inventory, within a few days
they will have replacement units sent directly from the plant in Singapore.
Shops will no longer have excess inventory, thus reducing sales costs
and cutting the price of the iMac in the end.
Nikkei MAC: In the future, will all of your products, including
existing ones, be sold exclusively at selected shops through such distribution
Fukuda: As a first step, we will use the distribution channel
only for iMac.
Conventional Mac machines for professional users will be sold via the
existing distribution channels, including sales by visits to customers.
Details, including the timing, have not yet been decided, but we plan
to offer a build-to-order system for distributors.
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