Apple Stores Top List Of America’s Most Profitable Retail Outlets

Apple Stores Top List Of America’s Most Profitable Retail Outlets

If you’ve read the Steve Jobs biography by Walter Isaacson, you may remember that Apple’s board was initially very hesitant to give Jobs a green light about creating Apple’s retail stores. A decade later, the stores have been an amazing success with hundreds of outlets around the world. They have also become the most profitable retail outlets in America.

Research company RetailSails ranked the country’s top retailers using the common retail metric of annual sales per square foot. Apple nabbed the top spot with sales averaging $5,647 per foot – nearly double high-end jeweler Tiffany and Co., which came in a distant second.

Outside of Apple, all other companies in the top five can be considered luxury goods companies including (in order of ranking): Tiffany, Coach, Lululemon Athletica, and True Religion Apparel. Tiffany and Coach are both known as particularly high-end retailers.

This clearly shows that Apple’s unique retail philosophy of allowing users to experience products, offering a very friendly and individualized hands-on approach by staff, and value added features like free training classes and events are paying off quite handsomely.

Ironically, Apple’s stores do more for the company than direct retail sales – creating brand awareness, encouraging customers to become familiar with Apple products, offering support, and so on. That makes the value of the Apple’s retail approach even more impressive since these figures don’t take into account purchases of Apple products that take place online or from other retailers.

Of course, Apple hasn’t shied away from continuing to innovate in retail. The company relaunched its early stores with a new look that is all about getting customers to try out Macs, iPads, iPhones and other products and doesn’t feature anything resembling a traditional cash register. More recently, Apple reinvented retail again by enabling iPhone 4 and 3S owners to make purchases on their own using the company’s retail app.

By contrast to Apple, Walmart’s average annual sales per square foot comes out to be just $414.

  • joewaylo

    They should go bigger like Federal Government big. Seeing an Apple Store in the Pentagon would bring a smile on several employees faces.

  • Michael Dalessandro II

    “Tiffany and Coach are both known as particularly high-end retailers.”
    I’m not sure that classifying Tiffany and Coach in the same category is the correct thing to do here.  High-end implies the company has the ability to demand a significant premium over similar players in the same market.

    Coach, at this point in its existence, has positioned itself to appear as a premium brand to the budget shopper. (I had to strain myself to find something on their site that cost more than an iPad.)  It has basically become the Android budget phone you get for signing a new 2-year contract.  When stacked up against other “designer hand bag” establishments they are left nearly bottom rung. 

    This is in contrast to Tiffany which has maintained the ability to demand a premium over similar outfits.  They pay meticulous attention to detail and strive to upkeep the integrity and quality of their products, image, and brand.

    A better comparison would be True Religion or Lululemon.  Both of these stores are able to demand that significant premium over other players that establishes a brand as “high-end”.  
    However, the best comparison is Tiffany to Apple. Tiffany and Apple both maintain strict control over nearly every aspect of their business, from manufacture to client experience and you don’t see an Apple outlet store to dilute the value of the brand.  The same applies to Tiffany.

    Might seem to be splitting hairs, or may come off as pretentious.  Neither of which are intended. The main point here is that Apple doesn’t deserve to be compared to a company being hoisted to a level it hasn’t earned the right to.

  • appdevelopers

    apple store will get even bigger and profitable in next coming years.

About the author

Ryan FaasRyan Faas is a technology journalist and consultant living in upstate New York who has written extensively about Apple, business and enterprise IT, and the mobile industry. In addition to writing for Cult of Mac, he is a contributor to Computerworld, InformIT, and Peachpit Press. In a previous existence he was a healthcare IT director as well as a systems and network administrator. Follow Ryan on Twitter and Google +

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