Apple Store Expansion in China Said to Have Slowed Due to Red Tape, Fraud, and Other Factors

Discussion in 'Politics, Religion, Social Issues' started by MacRumors, Oct 29, 2018.

  1. MacRumors macrumors bot


    Apr 12, 2001

    In 2015 and 2016, Apple aggressively expanded its retail presence in China with 30 new stores, according to the Apple Storefronts tracker. Since the start of 2017, however, Apple has opened just five new locations in the country.

    Apple's newest store in China in Suzhou

    The Information's Wayne Ma has shared a report today that offers explanations for the slowdown, including China's bureaucratic government, scalpers, previously-reported fraud, and increasing competition from Chinese smartphone makers. The report is based on interviews with 17 former Apple employees.

    On government bureaucracy:
    On scalpers:
    Other factors, according to those interviewed, included low-level government officials asking for free iPhones and other products as a form of bribery, a tug-of-war between the Beijing and Shanghai local governments over taxes, and a vibrant gray market for iPhones smuggled from Hong Kong.

    As a result of these difficulties, Apple is said to have "abruptly changed" its retail expansion plans in mainland China in 2017, resulting in the dramatic slowdown in grand openings. Apple's latest store in China opened in the city of Suzhou on September 21, coinciding with iPhone XS and iPhone XS Max launch day.

    Last quarter, Apple brought in revenue of $9.5 billion from the Greater China region, including Taiwan, Hong Kong, and Macao. Greater China accounted for 17.9 percent of Apple's revenue in the quarter, making it the company's third largest market, behind the United States and Europe.

    Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

    Article Link: Apple Store Expansion in China Said to Have Slowed Due to Red Tape, Fraud, and Other Factors
  2. DrJohnnyN Suspended


    Jan 27, 2010
    China is all over the MacRumors site today.

    Why are scalpers known as Yellow Cows?
  3. simply258 macrumors regular

    Oct 15, 2003
    Oh look, there’s 5 Macs in the back, you might need to squint to see them.
  4. DrJohnnyN Suspended


    Jan 27, 2010
    Squint... China... I see what you did there.
  5. iapplelove macrumors 601


    Nov 22, 2011
    East Coast USA
    So anything China related is automatically in the social and political forum?
  6. AngerDanger, Oct 29, 2018
    Last edited: Oct 29, 2018

    AngerDanger macrumors 601


    Dec 9, 2008
    This is the most exciting Apple-related thing that has ever happened.

  7. DrJohnnyN Suspended


    Jan 27, 2010
    Why, are you yellow, or a cow?
  8. RogerWilco macrumors 6502a


    Jul 29, 2011
    Spare parts shenanigans and unseen pressure from local officials and regulators with their hands out surely makes for an interesting business environment. Apple portrays itself as above all the riff raff. What’s that old Chinese saying, “all fishes swim in the same water”?
  9. Guda.FL macrumors 6502

    Sep 23, 2015
    Was thinking the same thing.
  10. AngerDanger macrumors 601


    Dec 9, 2008
    Nah, just part joking on my mother's side.
  11. GrumpyMom macrumors 604


    Sep 11, 2014
    All that trouble to open a store there and there are still unserved areas in the US.
  12. ilikewhey macrumors 6502a


    May 14, 2014
    nyc upper east
    don't blame them, this article brought up so much memory when i was in china couple years back and i had to fight bunch of ppl who were cutting in lines to get a taxi,

    alot of these low-level gov't officials grew up with the peasant revolution and therefore don't have an education, its really a dog eat dog world over there often times.

    when they see apple trying to open up a store on their turf they want to exploit them for $$$ as much as possible. hence the red tape nightmare
  13. Mike MA macrumors 68000

    Mike MA

    Sep 21, 2012
    Yet, Apple is still trying to strengten human rights and data privacy - so expect further bureaucratic hurdles to come...
  14. Mr. Dee macrumors 68000

    Mr. Dee

    Dec 4, 2003
  15. magicschoolbus macrumors 65816


    May 27, 2014
  16. PG(Austin) macrumors regular


    Sep 24, 2004
    Austin, TX
    WHAT!!?? Fraud!!?? In CHINA!!?? I just can't believe that!

    But it doesn't matter...soon there will be an Aple Store right next door, backed by the Chinese Government.


  17. AppleMark macrumors 6502a


    Jun 17, 2009
    The CCTV Capital of the World
    I think you are making a moo-t point.
  18. vertical smile macrumors 68040

    vertical smile

    Sep 23, 2014
    That was the most interesting part of the the story for me.

    Actually, they have been all over MR for a while now, I just can't remember it ever being a positive story for Apple.

    If Apple's push into China ends up working out for them, it will look like a genius move. So far, it looks like it is nothing but problems.

    Probably because every China related story on MR, including this one, involves something political.
  19. koruki macrumors 65816


    Aug 16, 2009
    New Zealand
    I really think China should be smart like the U.S and create a degree for fr..Lobbying. That allows much more control and means other countries can't ride a high horse. Though spending millions to wine and dine politicians to get what you want instead of a box of iPhones might still work out cheaper.
  20. szw-mapple fan macrumors 65816

    szw-mapple fan

    Jul 28, 2012
    That's just a poor translation on MR's part. The translations should just be cows or cattle. In Chinese water buffalo is "water cows" and cows are "yellow cows" because of their fur color, among other types of cows that has a prefix to describe them. They are called cattle because ticket scalpers (and now phone scalpers) would swarm the seller like a herd of cattle.
  21. bollman macrumors 6502

    Sep 25, 2001
    Lund, Sweden
    Well, it seems MacRumors is not doomed. There are still knowledgeable people around (and I'm not being sarcastic!).
  22. SteveW928 macrumors 68000


    May 28, 2010
    Victoria, B.C. Canada
    Apple better get this figured out, as this is what they have to look forward to in the USA too in a decade or so.
  23. alexgowers macrumors 65816

    Jun 3, 2012
    China has grown so fast that its these new corruption issues that Apple has faced that will break its growth and prosperity. They appear nimble for such a large country but really Apple has seen the many new issues no other country ever gives it. I’m not surprised they basically pulled out. The same is true with India, where they ethnically cleanse businesses. It might seem like a good idea but it’s out and out racism we don’t tolerate in the west.
  24. JimAtLaw macrumors 6502

    Sep 26, 2006
    Bay Area, CA
    Er, I’m not sure I’d characterize those corruption issues as “new.” (We have the Foreign Corrupt Practices Act precisely because they are not new... maybe you were thinking new for Apple, though I don’t think that’s likely true either.) It will be interesting to see if this changes materially during our lifetimes, color me doubtful.

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23 October 29, 2018