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Technology Stocks : Apple Inc.
AAPL 273.28-0.4%3:48 PM EST
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To: X-Ray Man who wrote (10191)3/26/1998 5:26:00 PM
From: Bernard Elbaum  Read Replies (4) of 213176
 
I know nothing about Apple's overall sales, some half of which is to schools rather than retail vendors. But I can report that judging from the sales performance at one major retail vendor, Apple, as I said before, has serious inventory problems.
The inventory problem has a couple of dimensions.

1. Products, I'm talking new products such as G3 not old, are not selling fast enough. Apple recently reduced the percent of shipments which vendors can return to Apple unsold from 10% to 5%. This vendor would like to return more.

2. Apple has responded by trying to entice reorders by cutting the base price to vendors by 2%. But the incentive to reorder is small because Apple can't guarantee that it can supply the most popular products that are selling well.

The second problem sounds familiar. The first suggests declining market share and interest, despite strong new products.
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