Apple Resellers and Service Providers Speak Out Following Simply Mac Closures

GameStop last week announced it is closing a number of non-productive Simply Mac locations throughout the United States, less than four years after acquiring and expanding the Apple Authorized Reseller and Service Provider, which effectively serves as a third-party Apple Store in smaller markets.

apple_premium_reseller
Following the reports, we received a tip from a disgruntled Apple Authorized Service Provider owner who said the underlying issues prompting Simply Mac's downsizing are "far deeper" than it would seem. He noted his own AASP is closing because Apple has "slowly strangled" him on margins and with "free labor" demands.

Another longtime Apple Authorized Dealer and Service Provider told us that AASPs have been "under siege" for years. The person, who wishes to remain anonymous, said profit margins are "appallingly low" and that Apple views its authorized service partners as "nothing more than glorified TV repairmen."

"I am sad to say that I do not see this changing," the person said. "Apple is highly aware of our concerns and do not seem to care. As an Apple reseller for over 20 years, I thought that when Apple became successful we would participate in that success, but we did not," the person added.

Given the polarizing comments from a few, we decided to reach out to a number of Apple's authorized sales and service partners in the United States and Canada to see if there is any validity to the claims.

A number of the Apple Authorized Resellers and Service Providers we spoke to refuted the allegations, noting they are stable if not growing, but we did learn that Apple has made one adjustment in particular that might explain the pressure felt by some sales and service partners—especially smaller ones with fewer sales.

Since August 2015, Apple has lowered its profit margins for resellers, requiring them to pay more upfront for products. Apple then rebates the difference as part of the monthly Business Development Funds checks it sends to resellers, but this method requires resellers to wait longer to be fully paid.

In other words, while the margins did not change overall, resellers are now forced to pay more upfront for Apple products to sell, which restricts cash flow that could otherwise be used for day-to-day operations, employee wages, and other expenses. For smaller resellers, the change can be particularly burdensome.

Meanwhile, one reseller believes Apple's arguably lackluster 2016 was a contributing factor to its own year-over-year sales decline.

On the service side, one person told us they "don't know that there is any truth" to the statement about Apple demanding "free labor," which a separate source said is likely an exaggeration for certain items that Apple used to compensate resellers for but now considers "non-revenue repair."

"I would not say that Apple has been demanding any kind of free labor," a service manager told MacRumors. "However, they are increasingly sending customers to us for iPhone repairs, which do not pay very well. We get paid more for a ten minute Mac repair than we do for an hour-long iPhone one."

"I am pleased to say that Apple really values their service partners and has increased our compensation for warranty work," another reseller said. "If you can achieve Premium Service Provider status, you get some nice perks along with higher compensation. While not perfect, Apple service really seems to care about us and is constantly trying to make things better for us."

MacMedics, an Apple Authorized Premium Service Provider with two locations in Maryland in Severna Park and Lanham, and another in Philadelphia, agreed to comment on the record to shine positive light on Apple.

"We're doing very well, we've expanded, and we opened a new pure retail location in 2015. Apple give us great support and guidance," said Dana Stibolt, President of MacMedics. "We're very encouraged by the upward trends over the last year, and in fact we're hiring more staff for all locations for both in-lab and on-site."

The other sources asked not to be identified. Apple and GameStop did not respond to requests for comment.

Top Rated Comments

69Mustang Avatar
55 months ago
So the moral of the story seems to be, as with all things, YMMV. Some are doing badly, some are getting by, and some are thriving. Welcome to this thing we call life.
Score: 33 Votes (Like | Disagree)
2457282 Avatar
55 months ago
So the moral of the story seems to be, as with all things, YMMV. Some are doing badly, some are getting by, and some are thriving. Welcome to this thing we call life.
After finishing the article I was confused to what it is saying. All I got is some folks like being an Apple reseller and others don't. I think you summed it up well.
Score: 8 Votes (Like | Disagree)
Lamborrari Avatar
55 months ago
Considering Apple is squeezing the profit margins of Authorized Resellers, I wonder how the smaller retailers can compete selling Apple products at retail prices while huge sellers like B&H Photo or even Best Buy can offer massive discounts.
Score: 7 Votes (Like | Disagree)
69Mustang Avatar
55 months ago
Opinion 1
"We're doing very well, we've expanded, and we opened a new pure retail location in 2015. Apple give us great support and guidance," said Dana Stibolt, President of MacMedics. "We're very encouraged by the upward trends over the last year, and in fact we're hiring more staff for all locations for both in-lab and on-site."

Sounds good to me.
Opinion 2
It's so sad. Really, Team Cock/Crook/Crack?

Hope, doesn't becomes the same story from MacRumors one day. "We were a Apple news site for 20 years..
https://www.change.org/p/apple-bring-back-the-17-inch-macbook
Two people read the same article and come away with diametrically opposed opinions. Guess it all comes down to where Apple lies on your emotion meter. It's apropos of nothing, just an interesting thing that popped into my head. The article doesn't come down one way or the other.
Score: 7 Votes (Like | Disagree)
meaning-matters Avatar
55 months ago
Sounds like Apple is a commercial company.
Score: 4 Votes (Like | Disagree)
840quadra Avatar
55 months ago
Sad to continue to see this. Not long Ago, Minnesota lost First Tech computer sales, which was part of the original Team Electronics chain. One of, if not the first official corporate reselles of Apple computers.
Score: 4 Votes (Like | Disagree)

Top Stories

samsung experience 1

Samsung's 'iTest' Lets You Try a Galaxy Device on Your iPhone

Thursday April 8, 2021 12:42 pm PDT by
Samsung has launched "iTest," an interactive website experience that's designed to allow iPhone users to test out Android on a Galaxy device, or "sample the other side," as Samsung puts it. Subscribe to the MacRumors YouTube channel for more videos. The iTest website is being advertised in New Zealand, according to a MacRumors reader who came across the feature. Visiting the iTest website on...
sonny 2021 ipad mini pro dummies

Leaked Dummy Units Show iPad Mini 6 With Thick Bezels and Home Button, New iPad Pro Models

Thursday April 8, 2021 2:11 am PDT by
Rumors suggest Apple will release refreshed versions of the iPad mini and iPad Pro models in the first half of this year, potentially as soon as this month, and a new leak today has provided us with a possible preview of what to expect in terms of the devices' overall design and camera prospects. Tech leaker and Apple blogger Sonny Dickson this morning shared images on Twitter showing dummy ...
apple music for artists new icon

Apple's Revamped Apple Music for Artists Icon Leads to Speculation About iOS 15 Design Plans

Tuesday April 6, 2021 1:03 pm PDT by
Apple yesterday updated its Apple Music for Artists app with some minor bug fixes and improvements, but also one other notable change -- a new icon. New icon on the right The Apple Music for Artists app now features a simpler, streamlined icon with a pinkish red music logo rather than the multicolored logo that was used before. The icon also has an embossed look that makes it stand out from...
apple find my network

Apple Announces Find My Network With Support for Third-Party Devices

Wednesday April 7, 2021 10:06 am PDT by
Apple today announced the launch of its Find My network accessory program, which is designed to allow third-party Bluetooth devices to be tracked in the Find My app right alongside your Apple devices. According to Apple, the first accessory companies to take advantage of the new Find My integration include Belkin, Chipolo, and VanMoof, with devices set to be available beginning next week. ...
new m1 chip

M1 Mac RAM and SSD Upgrades Found to Be Possible After Purchase

Tuesday April 6, 2021 5:34 am PDT by
Technicians in China have reportedly succeeded in upgrading the memory and storage of the M1 chip, suggesting that Apple's integrated custom silicon for the Mac may be more flexible than previously thought. Reports of maintenance technicians being able to expand the memory and storage of M1 Macs began circulating on Chinese social media over the weekend, but now international reports have...
Intel MBP Is Thin and Lighjt

Intel Ad for 'World's Best Processor' Features a MacBook Pro

Wednesday April 7, 2021 9:51 am PDT by
Intel has been on a relentless marketing drive against Mac computers in recent weeks, positioning them as inferior to Windows laptops powered by Intel processors. In a slight slip-up, however, Intel has accidentally used a MacBook instead of a Windows laptop in one of its newest ads to promote one of its new 11th-generation chips as "the world's best processor." The ad appeared on Reddit and ...
tmobile 5g modem

T-Mobile Launches Unlimited 5G Home Internet for $60/Month

Wednesday April 7, 2021 2:18 pm PDT by
T-Mobile today hosted an Un-carrier event where the company announced the launch of a a new 5G home internet plan, which is priced at $60 per month and offers unlimited data. The service is available to more than 30 million Americans across much of the United States, including 10 million households in rural areas not typically able to access reliable broadband. Connectivity will be either 4G ...
iMessage Android featured

Apple's Rationale for Not Bringing iMessage to Android Revealed in Legal Documents

Friday April 9, 2021 2:22 am PDT by
It's no secret that Apple sees iMessage as a big enough selling point to keep the service exclusive to Apple devices, however new court filings submitted by Epic Games in its ongoing lawsuit with the company reveal just how Apple executives have rationalized their decision not to develop a version of iMessage for Android. Apple clearly recognizes the power that iMessage has to keep users...
14

Apple Seeds Seventh Betas of iOS 14.5 and iPadOS 14.5 to Developers [Update: Public Beta Available]

Wednesday April 7, 2021 10:04 am PDT by
Apple today seeded the seventh betas of upcoming iOS 14.5 and iPadOS 14.5 updates to developers for testing purposes, with the new beta updates coming one week after Apple released the sixth iOS and iPadOS 14.5 betas. iOS and iPadOS 14.5 can be downloaded through the Apple Developer Center or over the air after the proper profile has been installed on an iPhone or iPad. iOS 14.5 is the...
ipad pro and macbook pro

iPad and MacBook Production Reportedly Delayed Due to Global Chip Shortage

Thursday April 8, 2021 2:31 am PDT by
Apple is facing a global shortage of certain components for some of its MacBook and iPad models, causing the Cupertino tech giant and its suppliers to postpone production of the products, according to a new report from Nikkei Asia. According to the report, MacBook production is being hindered due to the shortage of chips mounted onto the circuit board before final assembly, which is a key...