Microsoft has closed its physical stores in mainland China, shifting the sale of its products to partners and online platforms, including its own website.
According to Chinese state-sponsored media, Microsoft stated it would now focus on sales through these channels when serving the nation. Industry experts attributed the closures to declining interest in Surface products and insufficient profits.
Microsoft China has not responded to requests from The Register for details but has confirmed the closures to other outlets.
While the Microsoft-branded physical stores are no longer operational, retail partners and Microsoft.com will continue to sell the products, along with e-commerce platforms like Taobao and JD.com.
It is reported that June 30 was the deadline for closing the shops.
Apple, whose successful physical stores reportedly inspired Microsoft’s retail venture, lists 47 stores operating in mainland China, with additional locations in places like Hong Kong and Macau. Apple’s retail strategy differs from Microsoft’s, as it relies less on third-party retailers.
In June 2020, Microsoft began “a strategic change in its retail operations,” which involved moving away from physical retail shops worldwide, except for locations in London, New York City, Sydney, and its Redmond Campus. Mainland China was initially exempt from this strategy, operating under a franchise model.
Besides closing its retail chain in China, Microsoft has been relocating employees out of the country since May.
It offered up to 800 China-based employees the opportunity to move to the US, Australia, New Zealand, or Ireland. However, this relocation was optional, and operations in China continue.
During June congressional testimony, Microsoft vice-chairman and president Brad Smith stated that revenue from China accounts for around 1.5 percent of the company’s total income.
