Gateway closes stores, future strong for Apple retail

Gateway Inc. plans to close its entire network of 188 retail stores next week and lay off about 2,500 staff, the PC maker announced Thursday. Despite the downturn for Gateway, analysts believe the problems are associated with the company and not the larger retail market. Through its branding efforts, store locations and unique products, analysts feel Apple is well positioned in the retail market.

"I don't see any correlation between Gateway's shutdown and Apple's retail expansion," Jupiter Research Senior Analyst, Joe Wilcox, told MacCentral. "For Apple, its stores are as much about expanding brand awareness, offering a good Mac buying experience and building a stronger Mac community as they are about making money. For a number of reasons, including the locations chosen, Gateway wasn't seeing the same benefits."

The importance of store location is not something that has been underestimated by Apple. In a speech last month at the Morgan Stanley Semiconductor & System Conference, Apple Chief Financial Officer, Fred Anderson told the crowd that Apple had a different strategy then Gateway in the retail space.

"We do not have a Gateway strategy," said Anderson. "We're only interested in profitable stores" -- Apple's goal is not to saturate the market, he said. Anderson also indicated that Apple wants each retail location to be profitable within the first year of operation.

The Gateway stores will be closed April 9, Gateway said in a statement. It will continue to sell products directly to customers over the Web and by phone, and will seek to expand its presence in other retail outlets, the company said.

The move comes less than a month after Gateway completed its acquisition of PC vendor eMachines Inc. and installed a new chief executive officer, Wayne Inouye, who was previously eMachines' CEO.

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News source: Yahoo!

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