Apple Store Expansion in China Said to Have Slowed Due to Red Tape, Fraud, and Other Factors

In 2015 and 2016, Apple aggressively expanded its retail presence in China with 30 new stores, according to the Apple Storefronts tracker. Since the start of 2017, however, Apple has opened just five new locations in the country.

apple suzhou

Apple's newest store in China in Suzhou

The Information's Wayne Ma has shared a report today that offers explanations for the slowdown, including China's bureaucratic government, scalpers, previously-reported fraud, and increasing competition from Chinese smartphone makers. The report is based on interviews with 17 former Apple employees.

On government bureaucracy:

Apple had to navigate a maze of government bureaucracy to obtain everything from business and tax licenses to construction, fire and customs permits for imported building materials, former employees say. The regulatory framework in China is far more complicated than in the U.S., with many more layers of government, these former employee say, and it’s far more opaque. Employees frequently scrambled to chase down permits and local approvals to keep store openings on track, they said.

On scalpers:

Apple, too, had to contend with scalpers, known as "yellow cows" in colloquial Chinese. These scalpers swarmed its stores and elbowed out other customers during product launches and in-store promotions. …

Apple executives worried they were losing control of the customer experience in their stores, and along with it opportunities to interact with real consumers. The scalpers showed little interest in the accessories and add-on services Apple likes to offer customers.

Other factors, according to those interviewed, included low-level government officials asking for free iPhones and other products as a form of bribery, a tug-of-war between the Beijing and Shanghai local governments over taxes, and a vibrant gray market for iPhones smuggled from Hong Kong.

As a result of these difficulties, Apple is said to have "abruptly changed" its retail expansion plans in mainland China in 2017, resulting in the dramatic slowdown in grand openings. Apple's latest store in China opened in the city of Suzhou on September 21, coinciding with iPhone XS and iPhone XS Max launch day.

Last quarter, Apple brought in revenue of $9.5 billion from the Greater China region, including Taiwan, Hong Kong, and Macao. Greater China accounted for 17.9 percent of Apple's revenue in the quarter, making it the company's third largest market, behind the United States and Europe.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Popular Stories

maxresdefault

Five Features Coming to AirPods Pro 3

Friday June 27, 2025 10:52 am PDT by
Apple hasn't updated the AirPods Pro since 2022, and the earbuds are due for a refresh. We're counting on a new model this year, and we've seen several hints of new AirPods tucked away in Apple's code. Rumors suggest that Apple has some exciting new features planned that will make it worthwhile to upgrade to the latest model. Subscribe to the MacRumors YouTube channel for more videos. Heal...
iPhone Car Key WWDC 2025

Apple Announces 13 Automakers Planning to Offer iPhone Car Keys

Friday June 27, 2025 11:42 am PDT by
In 2020, Apple added a digital car key feature to its Wallet app, allowing users to lock, unlock, and start a compatible vehicle with an iPhone or Apple Watch. The feature is currently offered by select automakers, including Audi, BMW, Hyundai, Kia, Genesis, Mercedes-Benz, Volvo, and a handful of others, and it is set to expand further. During its WWDC 2025 keynote, Apple said that 13...
anker power bank recall

PSA: Anker Recalls Multiple Power Banks Due to Fire Risk

Friday June 27, 2025 4:16 pm PDT by
Popular accessory maker Anker this month launched two separate recalls for its power banks, some of which may be a fire risk. The first recall affects Anker PowerCore 10000 Power Banks sold between June 1, 2016 and December 31, 2022 in the United States. Anker says that these power banks have a "potential issue" with the battery inside, which can lead to overheating, melting of plastic...
Chase Sapphire Reserve Apple Perk Feature

Chase Sapphire Reserve Card Introduces New Perk for Apple Customers

Wednesday June 25, 2025 2:08 pm PDT by
Chase this week announced a series of new perks for its premium Sapphire Reserve credit card, and one of them is for a pair of Apple services. Specifically, the credit card now offers complimentary annual subscriptions to Apple TV+ and Apple Music, a value of up to $250 per year. If you are already paying for Apple TV+ and/or Apple Music directly through Apple, those subscriptions will...
iPhone 17 Pro Blue Feature Tighter Crop

iPhone 17 Pro Launching in a Few Months With These 12 New Features

Thursday June 26, 2025 2:00 am PDT by
Apple's next-generation iPhone 17 Pro and iPhone 17 Pro Max are around three months away, and there are plenty of rumors about the devices. Apple is expected to launch the iPhone 17, iPhone 17 Air, iPhone 17 Pro, and iPhone 17 Pro Max in September this year. Below, we recap key changes rumored for the iPhone 17 Pro models:Aluminum frame: iPhone 17 Pro models are rumored to have an...
A18 Pro Chip

New MacBook With A18 Pro Chip Spotted in Apple Code

Monday June 30, 2025 8:05 am PDT by
Apple is developing a MacBook with the A18 Pro chip, according to findings in backend code uncovered by MacRumors. Earlier today, Apple analyst Ming-Chi Kuo reported that Apple is planning to launch a low-cost MacBook powered by an iPhone chip. The machine is expected to feature a 13-inch display, the A18 Pro chip, and color options that include silver, blue, pink, and yellow. MacRumors...
macbook air spacegray purple

Apple Planning to Launch Low-Cost MacBook Powered By iPhone Chip

Monday June 30, 2025 3:20 am PDT by
Apple is planning to launch a low-cost MacBook powered by an iPhone chip, according to Apple analyst Ming-Chi Kuo. In an article published on X, Kuo explained that the device will feature a 13-inch display and the A18 Pro chip, making it the first Mac powered by an iPhone chip. The A18 Pro chip debuted in the iPhone 16 Pro last year. To date, all Apple silicon Macs have contained M-series...
CarPlay Ultra Climate Controls

Here's Which Vehicle Brands Will and Won't Offer Apple's CarPlay Ultra

Friday June 27, 2025 9:52 am PDT by
Apple last month announced the launch of CarPlay Ultra, the long-awaited next-generation version of its CarPlay software system for vehicles. There was news this week about which automakers will and won't offer CarPlay Ultra, and we have provided an updated list below. CarPlay Ultra is currently limited to newer Aston Martin vehicles in the U.S. and Canada. Fortunately, if you cannot...
apple watch ultra 2 new black

Apple Watch Ultra 3 Finally Coming After Two-Year Hiatus

Tuesday June 24, 2025 3:40 am PDT by
Apple will finally deliver the Apple Watch Ultra 3 sometime this year, according to analyst Jeff Pu of GF Securities Hong Kong (via @jukanlosreve). The analyst expects both the Apple Watch Series 11 and Apple Watch Ultra 3 to arrive this year (likely alongside the new iPhone 17 lineup, if previous launches are anything to go by), according to his latest product roadmap shared with...

Top Rated Comments

AngerDanger Avatar
87 months ago
Apple, too, had to contend with scalpers, known as "yellow cows" in colloquial Chinese. These scalpers swarmed its stores and elbowed out other customers during product launches and in-store promotions. ...
This is the most exciting Apple-related thing that has ever happened.

Score: 14 Votes (Like | Disagree)
PG(Austin) Avatar
87 months ago
WHAT!!?? Fraud!!?? In CHINA!!?? I just can't believe that!

But it doesn't matter...soon there will be an Aple Store right next door, backed by the Chinese Government.





Attachment Image
Score: 7 Votes (Like | Disagree)
DrJohnnyN Avatar
87 months ago
Trying to decide how offended I should be.
Why, are you yellow, or a cow?
Score: 5 Votes (Like | Disagree)
DrJohnnyN Avatar
87 months ago
China is all over the MacRumors site today.

Why are scalpers known as Yellow Cows?
Score: 3 Votes (Like | Disagree)
ilikewhey Avatar
87 months ago
don't blame them, this article brought up so much memory when i was in china couple years back and i had to fight bunch of ppl who were cutting in lines to get a taxi,

alot of these low-level gov't officials grew up with the peasant revolution and therefore don't have an education, its really a dog eat dog world over there often times.

when they see apple trying to open up a store on their turf they want to exploit them for $$$ as much as possible. hence the red tape nightmare
Score: 2 Votes (Like | Disagree)
Mike MA Avatar
87 months ago
Yet, Apple is still trying to strengten human rights and data privacy - so expect further bureaucratic hurdles to come...
Score: 2 Votes (Like | Disagree)