So how does one sign up? Getting Apple to accept your applications means you run through a standard set of applications that include forms, a background check, basic financial solvency, an aptitude and preferably a displayed passion for electronics. One Apple official who understands how the process works, but declined to be named, said that in the last fifteen years the American tech giant has only signed on 160 franchisees as Apple Premium Resellers or sales partners who hawk their famous iPhones.
Says one watch dealer who declined to be named, "Landing an Apple dealership is pretty much like getting the authorisation for a Rolex dealership." The business guarantees the best products in its space, and comes with customer base that is hooked to new releases year after year and a headquarters that is proactively in touch with its entire distribution piece and methodically supports its sales outlets and partners with products, technology and the rest of it.
Is there a checklist that aspirants will need to sign off against before they get enrolled by Apple? There indeed is one and Apple India doesn't share those details publicly. But the key stipulation predictably does include having financial access and the means to afford the right real estate, followed by a deep understanding of Apple stands for.
That laundry list gets down to the details of how many strobe lights are to be positioned in a shop, to how many computers and products are to be displayed and exactly where. "Everything for the business is defined," says one retailer in the trade. That means that right from the three-inch-by-two=inch acrylic cardholders that tell you what products are on display to the furniture fixtures which come from Shenzhen and the planograms (visual representations of a store's products and services) that determine how and where products will be showcased, the lighting plans, and in what sequence -– there's a playbook somewhere that describes how it will be done down to the shade of paint used on the walls feels and looks and will be the same across the stores in the world.
So why does Apple just have a handful of dealerships after close to two decades in the country? For one, the tech giant sees its investments
and the use of its name as a long-term investment, and any digression from what it sees as core values are abandoned without hesitation. In the past, Apple India has pulled the plug on franchises in Kolkata, and a couple of other cities where the collaboration wasn't panning out as planned.
The other is it would take a fairly serious entrepreneur to put his or her money where their mouth is. Fancy phones and slick, trendy laptops aside, starting an Apple franchise isn't for the faint-hearted. The financials are front-loaded: the fixtures themselves can run anywhere between Rs 10 million and Rs 20 million, and ancillary costs like staff salaries, inventory, permissions and licenses anywhere from Rs 20 million to Rs 30 million.
The rental costs or real estate charges are additional and can easily set a store operator back by Rs one million to Rs 15 million a month on average. Expect to break even within two years or sooner, however, and while predetermined margins on equipment are slim, which means it's a volume game despite being premium, the revenue from service plans, warranties, repairs and other accessories are where the real money is made. Typically, an investor can make profit of 3-10 per cent on devices with volumes driving the business. In phones, the margins are higher.
Ample Technologies, a firm that has been running one of the earliest Apple stores called Imagine at the Forum mall in Benhaluru since 2004, now runs 13 stores across Bengaluru, Chennai, Cochin and Hyderabad, and sees itself not just as a seller of Apple products but as "Apple experts." Rajesh Narang, director at Ample Technologies, didn't respond as of press time. There are others such as iPlanet, Nyasa and Maple, which also signed up early and run multiple stores across the country. So do those like Narang think about what some might see as Apple's austere commandments? No discounting, no blow out sales to clear stock, wafer-thin margins, and constant direction on product sales cycles regardless of how local markets may behave differently?
Devangshu Dutta, chief executive of consumer research firm Third Eyesight, says that India, of course, hasn't been the most important market for Apple, which is why the franchise model makes absolute sense. Even so, what really makes a franchise successful is the creation of value. "For anyone creating a viable Apple franchise, they have to be clear that you're not just selling boxes being shipped to you - a lot has to go into the service piece and the experience zone which frankly most Indian franchisees aren't oriented towards," he adds. "Therein lies the opportunity and the potential rewards of being different."
Must-haves for Apple Premium Reseller
Spotless track record
Affinity for technology
Own or access to great retail space
Be a successful business operator