A new report from The Telegraph this weekend claims that Apple Store vendors were “forced” by the company to accept stricter conditions for selling their products in Apple Stores and in the Apple Online Store. Vendors cited in the report describe that Apple is being “squeezed” by these new terms.
Through its retail and online stores, Apple sells accessories and products manufactured by third-party businesses. These include things like iPhone cases, smart accessories, peripherals for Mac and more. It is these companies that are affected by the new Apple Store terms.
The report explains that suppliers now have to wait 60 days after an order is completed, compared to the current 45 days. The companies must also adopt a ‘consignment model’, which means they are ‘paid only after an item has been sold, rather than after it has been received by Apple, which shifts the cost of inventory to them.’
Interestingly, the vendors say they have been able to negotiate with Apple on these terms in the past. This time, however, it is said that the conditions “were set by Apple and are non-negotiable.” This ensures that all suppliers now meet the same conditions, as opposed to different conditions for different suppliers, but it puts more pressure on each.
One company that sells goods in the Apple store said, ‘They do their retailers no favors; their sellers face cash challenges they do not. I do not think anyone is going to dismiss it; there is little competition for the exposure to brands you get with Apple. It’s definitely a print. ‘
In response to the story of The Telegraph, an Apple spokesman said:
“We appreciate the close relationship we have with the world-class companies that sell their products through Apple.com and in our stores. Apple regularly reviews the range of third-party products we sell and the structure of our models to give suppliers the ability to grow their businesses reliably and confidently. ”
Ultimately, suppliers are unlikely to terminate their contracts with Apple in light of these new terms, the report explains. Apple Stores offer more visibility and brand exposure than other retail and online channels, the vendors say.
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