It’s a long time coming, but Apple is likely to finally open its retail stores in India, one of the world’s most populous countries. India is a fast-growing market where Apple has largely ignored and has little presence, but things are about to change.
Previous rules set by the Indian government require companies setting up stores selling a single brand of product to have 30% of its content sourced from India. However, new business-friendly policies set by the Indian government on Monday exempt foreign-owned companies from the ruling. The exemption lasts three years, but can be extended to eight years, for companies like Apple that sell “cutting edge” products namely the iPhone and Macs.
Cheap and cheerful still rule
Apple sales in India grew 56% during its last fiscal quarter, but the fact of the matter is, cheap Android phones that cost less than $120 dominate the market. Retail stores will be unlikely to produce any major impact on sales, aside from being branding and marketing tools.
Opening retails stores will let Apple deliver to Indian consumers the full Apple experience—unlike currently where it works with local partners.
According to Gartner research, Indians will buy an estimated 139 million smartphones in 2016. Apple’s annual sales in India is a fraction of that, at only two million units (Gartner, 2015).
The new ruling will effectively allow Apple, as well as other major phonemakers like Xiaomi or Lenovo, to set up full-blown retail stores in India.
Last month, during his visit to India, Apple CEO Tim Cook announced that Apple would be opening a new development centre in Hyderabad, focused on map technology. The centre will create up to 4,000 jobs. Apple also opened a tech accelerator in Bangalore to encourage local app developers to write apps for Apple’s various platforms.
Source: New York Times