Question

Apple is considering eliminating one of its stores in a large US city. What are some factors that it should consider before making this decision?

Answer 1

Answer:

Some of the factors which influence in making decision about a store  to continue or discontinue the Apple store is as follows:

Cost: The main overhead in the store is rent payments and lease payments made for the store over a period of time. Management should take initiative how to minimise the expenses and curtail the store expenses like rent, electricity bills, staff costs etc.

Profit: If store opened could not generate adequate revenue as projected in the budgeted sales it may indicate the situation of closure of the store.

Competitive Edge: If the product in the store would not satisfy current trend or current requirements it may result in losses for the store and ultimately damage the goodwill of the company. Management should take robust steps with respective to product utility , customer demand, innovative technology to be available in this competitive world to gain extra edge over its competitors otherwise it would result in losses for the store.

Size of business: Management should take initiative to analyse the size of business and type of customers in which it want to target and analyse the requisite products which would to attain the large share of business. If it do not meet the above criteria, shutdown the store immediately otherwise it would pile up the losses.