Please note: This is not a misplaced April Fool's joke.
Apple (Nasdaq: AAPL) is laying off staff across its booming chain of retail stores. Nope, the world's richest company is not above letting some heads roll every now and then.
This bombshell comes from the MacRumors blog, reportedly based on independent sources in several key markets. In the U.K., for example, new hires and trainees are getting the ax en masse while some recent promotions were rolled back. Stateside, part-timers supposedly got their schedules drastically reduced as more responsibility moved over to full-time employees.
This seems strange at first, given that we're in the middle of back-to-school season, where youth-oriented retailers like Apple would normally hire more temps. But it's actually consistent with the avowed customer-service focus of Apple's recently appointed retail chief, John Browett.
Browett came to Apple from British electronics retailer Dixons -- largely a Best Buy (NYSE: BBY) clone sailing under the Union Jack. Like Best Buy, Dixons has suffered several years of weakening results as consumers turn to e-tailers for much of their gadget needs. But as CEO at Dixons, Browett started a successful turnaround bid based on better customer service. That's exactly the quality that made Apple boss Tim Cook reach out across the Atlantic for Browett, whom The Guardian calls "a rising star of British retailing."
Seen in that light, cutting back temp hours in a crucial gadget-retail season looks like the polar opposite of Circuit City's cardinal sin. When the defunct retailer needed to land a Hail Mary of the highest order to save its bacon, City chose to cut costs instead. Farewell to pricey old-timers who actually knew what they were doing and hello, fresh hires with minimal training and no experience. Months later, the chain declared bankruptcy because consumers would rather get decent service from rival Best Buy. (Ironically, Best Buy may be treading the same disastrous path these days.)
So Browett wants Apple to maintain top-notch customer service from seasoned veterans at crunch time. New hires can be picked up and trained in the offseason. The retail boss has been installed in Cupertino since April and probably needed some time to learn the ropes before doing anything big, so this action could very well be a sign of how things will work from now on.
Browett's predecessor, J.C. Penney (NYSE: JCP) CEO Ron Johnson, is currently under fire for pushing strange experiences on American shoppers. Browett is more of a nuts-and-bolts kind of guy, closer in style to Tim Cook's operational excellence than the visionary risk-taking of Steve Jobs.
Will this return to Retailing 101 drive Apple to new heights of global expansion, or have the stores lost their magical spark? We've created a premium report on Apple to help you track this important issue -- and many more besides. Grab your copy right now and enjoy a full year of freshly updated analysis as Cupertino adjusts to new leadership and new realities.
