Apple Supply Chain Assignment Sample
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Added on 2021-04-16
Apple Supply Chain Assignment Sample
Added on 2021-04-16
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Running head: SUPPLY CHAIN OF APPLESupply Chain of AppleName of the Student:Name of the University:Author Note:
SUPPLY CHAIN OF APPLE1Table of ContentsIntroduction:....................................................................................................................................1Supply chain challenges Apple Inc faces:.......................................................................................1Competition from other multinational companies:......................................................................1Dependence on competitors:........................................................................................................1Shipping challenges:....................................................................................................................2Sustainability issues of supplies:.................................................................................................2Benefits and limitations of sourcing strategies and their application in Apple:..............................3Advantages:.................................................................................................................................3Cost savings:............................................................................................................................3Alignment of sourcing with business targets:..........................................................................4Limitations of strategic sourcing:................................................................................................5Delays decision making:..........................................................................................................5Complicated process adds to the costs of operations:.............................................................5Performance objectives suppliers of Apple are expected to meet:..................................................6High quality raw materials:.........................................................................................................6Ethical business behaviour:.........................................................................................................6Conclusion:......................................................................................................................................6References:......................................................................................................................................7
SUPPLY CHAIN OF APPLE2Introduction:Supply chain management forms the base of the productivity of multinational companies,their revenue generation and consequent market leadership. Supply chains have becomeempirical to the competitive advantages companies enjoy in the global market. The supplychains the MNCs maintain also pose certain challenges to their user companies. The assignmentwould view the challenges posed by the supply chains through the lenses of Apple, the leader inthe IT industry. The paper would also delve into the importance and hardships the companiesface in strategic sourcing of raw materials and their expectations from the suppliers. Thediscussion with proceed on these three topics with Apple as the substratum.Supply chain challenges Apple Inc faces:Apple owing to its high-end and diverse product line has to face several challenges whileoperating in the global market:Competition from other multinational companies:The greatest challenge which Apple faces as far as supply chain in concerned iscompetition from other multinational companies. The product line of Apple consists of smartphones, Mac, music applications and hardwares, Ipads, TV app, smart watches and accessories.This means the company competes with multinational companies like Samsung and LG in termsof smart phones and smart watches, Google in terms of TV apps and Microsoft in case of MacOS. The company in order to maintain high quality of these products and meet the demands ofthe upper class customers, its main customer segments, has to compete with these MNCs to getbest quality hardware and software for its products. Moreover, the main operations of thecompany is concentrated in North America while Asian market is experiencing rapid rise indemand for products like smart phones and smart watches. The suppliers in the Asian marketprefer supplying materials to Asian manufacturers like Samsung and Sony. Hence, it can bepointed out that Apple faces stiff challenge in gaining the high quality raw materials for itsproducts.Dependence on competitors:The second supply challenge which Apple faces in the global market is its dependence oncompetitors like Samsung for raw materials. Samsung is the largest manufacturer of electronic
SUPPLY CHAIN OF APPLE3components like chips and batteries used in the electronic gadgets like smart phones. Thecompany also supplies Apple with various components for its high end devices. Thus, Applebecomes dependence on its toughest competitor, Samsung for components for its products(samsung.com, 2018). This would give Samsung the power to control the product strategies andbusiness operations of Apple indirectly. This heavy dependence on competitors is a big threatbecause it can pose serious threats to its productivity. For example, Apple often enters into legaldisputes with its competitors and suppliers like Samsung over product features (usatoday.com,2018). These disputes breach the relationship between the two companies which ultimatelyhampers the productivity of Apple since is former is dependent on the latter companies for thecomponents for its parts.Shipping challenges:Apple faces shipping challenges in its supply chain owing to macroeconomic influencesover which the company has no control. Apple acquires components from selected number ofsuppliers spread all over the world. The company has also spread its supply and manufacturingoperations into Asian nations like China to tap the market’s growing profitability. The companyis increasing depending on these overseas units for its supply of parts and manufacturing of itsfinished products. The differences in laws pertaining of crucial areas like manufacturing,shipping and labour in these countries pose serious threats to the productivity of the company.For example, it often takes months to get clearance to ship supply of components from China tothe US manufacturing facilities. Again, riots and other political disturbances in the foreignmarkets from where Apple sources its supply of components pose serious threats to itscontinuous supply of raw materials and production of finished goods (firstpost.com, 2018). Thisshows that shipping challenges stemming of political and other macro economical influencespose serious supply challenge to Apple.Sustainability issues of supplies:As pointed above, Apple is dependent on a limited number of suppliers for its supply ofcomponents. The suppliers of the company are spread all over the globe like TaiwanSemiconductor Manufacturing Company manufactures the processors for Apple. Again, itobtains a large proportion of its components from local suppliers like China. These supplyingcompanies are themselves coming under pressure like cost cutting and enforcement of
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