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(No.1 High-Tech News Site in Japanese)

  • Apple Japan's iMac PC Sales Strategy Far From Clear
  • August 10, 1998 (TOKYO) -- Apple Japan Inc. had not yet announced the shipment date or price of its new iMac product as of Aug. 3, but it had announced on July 23 that it planned to tie up with Shimamura Music, a musical instrument sales company, to sell iMac PCs.
    Worries prevail among Macintosh distributors that iMac sales outlets may have to go through strict screening by Apple Japan.

    Shipments of iMac PCs in the United States are scheduled for Aug. 15, with the PC listed at US$1,299. However, as of Aug. 3 no detailed announcement had been made in Japan as to the date of shipment or price.

    Eikou Harada, president of Apple Japan said that the new product will be "ready for shipment in August for a price less than the 200,000 yen level."

    The crucial point in determining the date of shipment is how soon Apple Japan can secure a sufficient number of iMac PCs for the Japanese market.

    "The initial production run of iMac PCs is 200,000 units, and orders for 70,000 units had been received in the United States by the end of July," a distributor said.

    This means that the remaining 130,000 units are to be shared in the United States, Europe and Japan. Shipments in Europe will start on Sept. 1. The volume of iMac machines to be shipped to Japan out of the remaining 130,000 and the date of delivery will be determined after seeing how well the iMac sells in the U.S. market at the time of shipment on Aug. 15.

    One of the distributors expects that the volume for delivery to Japan will be determined by around Aug. 20 and the initial shipment will occur after that date. He also expects that even if a sufficient volume cannot be secured, initial shipments will be made before the end of August.

    "Apple Japan won't be able to secure enough iMac PCs to meet demand and it appears likely that the company will reduce the number of sales outlets," another distributor said.

    The sales price (calculated at a dollar exchange rate of 145 yen) would be a little less than 190,000 yen (US$1,310). But because of the extra cost of sales in Japan, it would be difficult to sell the iMac for less than 200,000 yen.

    Many of the major Mac sales stores in Akihabara, Tokyo, have already received advance orders for iMac PCs.

    "We have no information on the iMac, which we are supposed to start selling in August," a PC store manager said.

    As of July 31, personal computer stores had received no information on the product's shipping schedule and prices. Many stores are making efforts to contact distributors so as to obtain a sufficient number of iMac PCs.

    Canon Sales Co., Inc., which is Apple's major distributor, also has little information. As of July 30, the company had no knowledge of the shipment date or volume.

    "We haven't received permission from Apple Japan to be an iMac sales store, and at this stage (July 30), we can't even make any commitment as to whether we will handle the iMac," said a spokesman for Canon Sales Co.

    "Apple Japan plans to sell the iMac through stores that fully understand the product's characteristics," Apple Japan president Harada said.

    His real intention probably is to avoid discount sales, taking into account the experience of having its Performa series sold at very low prices.

    It was under these circumstances that Apple Japan announced plans to tie up with the musical instrument sales firm, Shimamura Music for sales of iMac PCs.

    Shimamura Music Co. is Japan's largest chain of musical instrument stores. Most of its stores are within shopping malls for family shoppers. It is said that the company plans to begin sales of iMac PCs through 54 of its direct-management stores throughout Japan as soon as possible.

    "In selling the iMac, we would like to build up a new business model. We have agreed with Shimamura Music on sales strategies and corporate philosophy, and have come to agree on the aim to develop and expand a new consumer market in the areas of personal computers and music," an Apple Japan official said.

    An official at Shimamura Music said: "Rather than competing with existing sales agents by participating in the PC sales battle, we aim to give the iMac a new value that can't be found elsewhere. It's a solution focused on placing iMac in the center of a musical environment."

    Apple Japan can sell the iMac at family-type stores rarely visited by conventional Mac users. This is significant in that it can help cultivate entirely new customers.

    Apple Japan expects that the iMac PC can help it recover market share in the music-related area.

    An Apple Japan official said that the business collaboration with Shimamura Music is only the first such new strategy in the sale of iMac PCs and that the company would be willing to cooperate with any other business partner that can fully appreciate Apple Japan's unique business strategy and philosophy.

    (Nikkei MAC)

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    Updated: Sun Aug 9 21:20:21 1998 PDT