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Apple Distribution Changes

You won’t be able to pick up a Classic at your local fruit stand, but given the recent changes in Apple’s distribution channels, that’s not far off.

The most recent, and in some ways most shocking, change is that Apple will be working with Sears to sell special Macintosh bundles. You won’t be able to find a Mac in just any Sears though, because the contract includes only Sears Office Centers, of which there are about 70 around the country, though primarily on the East coast. The bundles will include the Mac Classic, LC II, IIsi, and PowerBook 140, along with the StyleWriter and Personal LaserWriters. Other pieces of hardware and software may also be included, most notably ClarisWorks, although that decision is apparently up to Sears and not Apple.

Apple is probably turning to Sears for a couple of reasons. First, the people who would buy hardware and software at Sears most likely wouldn’t buy it elsewhere, more through lack of knowledge of other sources than anything else. If this wasn’t true then dealers would be rather upset, although the dealers aren’t likely to be too happy about some of the other distribution changes anyway. Second, working with Sears is a great way for Apple to learn a bit more about selling in the consumer electronic market, a market Apple has an intense curiousity about at the moment. Based on our unrepresentative and extremely limited experience with Sears and Sears Office Centers, Apple could have picked a better partner, although we hope that our experiences truly were unrepresentative. Nonetheless, it will be extremely nice to have a Classic sitting next to one of those clumsy little IBM PS/1s that Sears already carries.

VAR Distributors — More likely to upset dealers are Apple’s other two new distribution directions, first to vertical market value-added resellers (VARs) through three of the big distributors, and also to the CompuAdd superstores. The three distributors include Ingram Micro, Merisel, and Tech Data Corporation, and these three will (starting this fall) recruit VARs to resell Apple products, although Apple will retain the right to final authorization.

Look at that, a whole paragraph of market-speak. Let me try to translate. The basic upshot is that these three massive distribution companies will be able to supply Apple hardware to consulting firms and suppliers who serve specific (that’s what vertical means in this instance) markets, like legal, engineering, real estate, architecture, and so on. Apple wants this to happen because these specific markets often get stuck in a rut of having to use a certain program or type of computer because everyone else does, not necessarily because it does the job well. For instance, a lot of lawyers only use WordPerfect for DOS because, the phrase goes, all lawyers use WordPerfect. Those lawyers tend to have specific consultants who can sell them DOS machines and WordPerfect and then provide support, so if Apple can get these consulting firms to also sell the Mac line via the large distributors, then Apple stands a chance of getting a foot into some of the specific markets.

The authorization of CompuAdd as an Apple dealer isn’t so much interesting for the fact that CompuAdd has a rapidly-growing chain of superstores around the country (though primarily in Texas, I gather), but because CompuAdd also runs a mail order business. Apple has not authorized CompuAdd to sell Macs through the mail, but I believe that CompuAdd is one of the first big companies with both a superstore and mail order presence to receive dealer authorization. If the distribution via CompuAdd’s superstores works out well, Apple just might authorize CompuAdd to sell Macs via the mail as well, causing trouble for all the grey-market mail order companies who sell Macs now.

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