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FDI approval delays Apple Store in India

MUMBAI: Apple may not open its own store in India before 2020 even as the iPhone maker has begun scouting for locations to set up brick-and-mortar stores.

The Cupertino-based technology firm is keen to open its first couple of stores – of 10,000 to 15,000 square feet size – at prime locations either in a mall or high street, and they could resemble its flagship New York City store on Fifth Avenue made entirely of glass, two senior industry executives said.

“Apple wants to initially set up two stores, one in New Delhi and second one in Mumbai,” said one of the executives. “They want the stores to be truly iconic right from the design to the location. However, getting desired space will take time since 10,000-15,000 square feet of prime location is not readily available.”

The Indian stores will be nearly double than that of its average global store size of 8,500 sq ft and will be the biggest single brand electronics store in the country, nearly 7-10 times that of rival Samsung , the executives said.

It was widely expected that Apple will open its first store soon as it meets the local production pre-requisite, having started assembling operations in the country for iPhone SE with partner Wistron.

Apple, however, is yet to receive approval from the government for its retail foreign direct investment (FDI) plans. Last month, a team from the Apple’s retail store business visited India to meet realtors and mall managers and understand the retail market, said the executives cited earlier.

The representatives included members from design, merchandising and commercial teams. They also saw potential sites and laid down specifications to the India team and real estate consultants. The company has signed non-disclosure agreement with various stakeholders regarding the store plans for 2020-21, they said.

India is already home to large global retailers such as Zara and H&M, which cherry picked marquee locations at both high street and malls, making it difficult for new entrants to bargain for good locations.

When contacted, an Apple India spokesperson said the company has no announcement to make on its retail store plans.

At present, Apple sells in India through franchisee-run exclusive brand stores, multi-branded and neighborhood stores, and e-commerce marketplaces. The Apple Stores in India will be limited in number, the executives said.The company is looking at 4-5 flagship outlets limited to metros over 5-10 years. This is due to the fact that each store requires huge space to suit its architectural design, which makes them a retail destination in itself attracting even tourists.

Globally, Apple has been expanding its retail store operations in Asia. It opened its first Apple Store in Southeast Asia at Singapore’s Orchard Road in May where it occupied four floors of a mall. This month, it opened its first store in Taiwan.

ET had earlier reported that Apple may initially start its online store in India by this year.

Apple’s online store plans does not require FDI approval in retail since the government allows companies to directly sell online those models that are manufactured locally .

Apple plans to expand local production, including the number of models, and set up a full-fledged manufacturing plant.

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