What margins do retailers make in Apple products?
Discussion
One thing that I've often wondered is with the iPhone they just sell; there is a rather large group of hardcore fans and "normal" people who just buy them, there are no gimmicks or freebies to entice people in; they just sell.
So with the fact that they just sell, whether on contract or outright, does Carphone Warehouse, EE, Vodafone etc make less money selling an iPhone than perhaps a Galaxy S5, Lumia 930, Sony Z3 etc on a like for like contract or outright purchase basis?
So with the fact that they just sell, whether on contract or outright, does Carphone Warehouse, EE, Vodafone etc make less money selling an iPhone than perhaps a Galaxy S5, Lumia 930, Sony Z3 etc on a like for like contract or outright purchase basis?
I can find out for sure in a couple of weeks....I am out for beers with a mate who is "fairly senior" at rather large electronics retailer.
I can tell you from having spoken to him in the past margins are tiny as we all know on electronics and I imagine on Apple products if anything it's even worse. It's an absolute must have product for retailers...do a Google search for John Lewis and the description is "iPad's TV's, Furniture, Fashion and More". They will almost definitely make more money from selling them with a contract.
With most electronics manufacturers the retailers only really make money when they hit volume targets....i.e. when they sell 100,000 Samsung TV's they get a substantial cash payment.
I can tell you from having spoken to him in the past margins are tiny as we all know on electronics and I imagine on Apple products if anything it's even worse. It's an absolute must have product for retailers...do a Google search for John Lewis and the description is "iPad's TV's, Furniture, Fashion and More". They will almost definitely make more money from selling them with a contract.
With most electronics manufacturers the retailers only really make money when they hit volume targets....i.e. when they sell 100,000 Samsung TV's they get a substantial cash payment.
Have a look at companies house for the accounts of companies like Insight or Academia. Both Authorised Apple Resellers. You'll find declared gross profit for the last few years to be around 10% of their turnover and net profit of around 1%. Insight are a £300 million turnover company in the UK,but only return around £3 million to their group on a good year. IIRC they lost money last year overall.
P924 said:
About 10 years ago while working for an IBM business partner, margin on Apple products was somewhere between £1 and £5 depending on the product.
There is no margin to work with.
From about 2% on iPads from a friend who sells Apple kit. Handy that, when someone pays by credit card.There is no margin to work with.
There is more profit in a non Apple £30 cover than there is in a £500 iPad
talkssense said:
From about 2% on iPads from a friend who sells Apple kit. Handy that, when someone pays by credit card.
There is more profit in a non Apple £30 cover than there is in a £500 iPad
Exactly! Wasn't enough to cover shipping from the distie to ourselves.There is more profit in a non Apple £30 cover than there is in a £500 iPad
I don't know if Apple had some sort of partner program, where you got added benefits for sales volumes, sounds unlikely though.
Apple do have a partner program of sorts, these guys are at the highest accredited level I believe: http://www.jigsaw24.com/fcp/content/apple/content
The B2B IT reseller I work for sell >£10m a year of Apple hardware and IIRC we get 9% discount, only 7% on iPad Minis, and nothing on iPhones as we aren't a network provider. There are also rebates available for hardware sold into 'major accounts' (mainstream household names) and central Gov.
Not sure about consumer focused retailers though.
The B2B IT reseller I work for sell >£10m a year of Apple hardware and IIRC we get 9% discount, only 7% on iPad Minis, and nothing on iPhones as we aren't a network provider. There are also rebates available for hardware sold into 'major accounts' (mainstream household names) and central Gov.
Not sure about consumer focused retailers though.
talkssense said:
From about 2% on iPads from a friend who sells Apple kit. Handy that, when someone pays by credit card.
There is more profit in a non Apple £30 cover than there is in a £500 iPad
That's pretty common in electronics retailing....more money in HDMI cables than the TV's they're sold with.There is more profit in a non Apple £30 cover than there is in a £500 iPad
Cheib said:
talkssense said:
From about 2% on iPads from a friend who sells Apple kit. Handy that, when someone pays by credit card.
There is more profit in a non Apple £30 cover than there is in a £500 iPad
That's pretty common in electronics retailing....more money in HDMI cables than the TV's they're sold with.There is more profit in a non Apple £30 cover than there is in a £500 iPad
Minimal to say the least! Not looked recently but it really wasn't worth it for us. Even buying from some of the distributors it knocked mere % off.
Usually Amazon are the better places to get it from, although I have seen the new Retina iMac for just under £100 off the usual price in Costco.
I know if you are a reseller if you're selling for under the RRP you won't have a long relationship with Apple!
Usually Amazon are the better places to get it from, although I have seen the new Retina iMac for just under £100 off the usual price in Costco.
I know if you are a reseller if you're selling for under the RRP you won't have a long relationship with Apple!
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