Impact of Macro Environment on Apple Inc.'s Business Operations

This report provides a comprehensive analysis of Apple Inc.'s business environment. It begins with an introduction to the business environment and its impact on companies like Apple. The main body delves into the positive and negative impacts of the macro environment on Apple's operations, utilizing the PESTLE framework to analyze political, economic, socio-cultural, technological, environmental, and legal factors. The report also conducts an internal and external analysis of Apple Inc., including its strengths, weaknesses, opportunities, and threats (SWOT). The analysis highlights how Apple's strengths and weaknesses are interconnected with macro environmental factors. The report concludes by summarizing the key findings and implications for Apple Inc. in the context of its business environment.

BUSINESS AND BUSINESS
ENVIRONMENT

Table of Content
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
P4. Positive and negative impact of macro environment on business operations.......................3
P5. Conducting internal and external analysis of Apple Inc.......................................................5
P6. Explaining how strengths and weaknesses are interrelated with macro factors...................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment is defined as the surrounding that contains all the internal and
external factors such as; need and expectations of customers, employees, management, owner,
technological innovation, activities by government, market or social trend, etc. that positively or
negatively affects the business. The present study of the business environment is based on the
study of Apple Inc., is an American based multi-national technological company that is
headquartered in California. Apple company designs and sell computer software, consumer
electronic and online services. The study will analyse the negative and positive impact of macro
environment on the operations of Apple and also going to analyse internal and external
environment of company.
MAIN BODY
P4. Positive and negative impact of macro environment on business operations
Macro environment in the business includes all the political and economic protocol that
acts positively by raise opportunities for the industry or negatively by limits the operations
(Barik and Kumar, 2018). One of the major impact of the Macro environment is due to the fact
that economic policy of the country that are implemented by the government can help to
encourage and expand the business. Macro environment of Apple can be identified through
PESTLE framework. PESTLE is an analytical tool to analyse and monitor macro environmental
factors. The analysis provide Apple an understanding about the opportunity that provide an
advantage to the company and areas of improvement.
Political Factor
 Brexit effect- A political decision regarding the Brexit affects company the most as
Apple in UK have to limits their operations. Weaken pound against the dollar, for
instance; the Brexit vote led the value of the pound of fall by 18.6% against the US
dollar. This put pressure on the company to reduce their prices of products and services.
 Free trade policy- The political factor have direct affects on the operations of Apple Inc.
UK's free trade policy is improving with implementing various policies that is the biggest
opportunity for the company (Deasy and et. al., 2016). This external strategic factor
enhance the opportunity for Apple Inc. and strengthen the distribution channel to
distribute its products all around the world.

Economic Factor
 Cost of labour- Apple Inc. has directly affected through Brexit decision in negative
manner. It fluctuates various costs and prices, for example; Brexit increases the price of
labour cost in UK that affects the company's operation and increase the cost of products
and services of the industry.
 Increasing disposable income among the target consumers- High economic growth
rate of the country has positive effect on the company as the income of consumers will
increase and it makes them able to invest in the products and service of Apple Inc. the
company have opportunity to sell high priced technology products and high disposable
income contribute to the growth of the company.
Socio-Cultural Factor
 Increase in the dependency on digital system- The rising trend to use mobile phones
and other technological devices provides an opportunity to the company regarding
growth and development (Evans and et. al., 2017). For example; Population is dependent
on digital system that is a positive impact on the company and Apple able to sell more
products that is based on higher demand.
 Anti-Apple sentiment- other than opportunity, this factor is a threat for the company.
Anti-Apple sentiment are questioning and mounting business practices such as lawsuits
against third party service provider, for example; who repair iPhone and MacBook. This
factor reduces the brand image of Apple and trust and confidence of the consumers to
adopt technology in the day to day life.
Technological Factor
 Increase in technological integration- Under the external strategic factor, technological
integration and growing demand for cloud computing presents opportunity to enhance
services of Apple. For example; Apple is offering cloud services to the consumers in the
limited extent maximize the profitability of the business. Thus, technological factor have
positive impact on Apple and contribute in the growth and development.
 Growing capabilities under technology of other business- With the technological
advancement, other firm that are intense competitor of Apple Inc. are more technological
advanced than Apple that is a threat for the industry (Fozer and et. al., 2017). For
example; Many companies like; Samsung are more technological advanced and capable

to provide high value products at affordable prices that negatively affected the financial
performance and brand image.
Environmental Factor
 Trend of sustainability- Business sustainability trend is directly linked with the
sustainable performance that should adopt by the businesses in concern with the
environmental impact on operations of business. This factor improves the brand image
and positively affect the operations of Apple.
 Energy efficiency trend- This trend in UK become an opportunity for Apple as they are
working for new technological solution by providing batteries, processor that are energy
efficient and other equipment with less heat emission. By this company is able to
promotes the adaption of more efficient technology and to improve their operational cost.
Legal Factor
 Privacy regulations- Legal factor appears as a threat for the company including new
rules and regulations in the technological company regarding privacy concern. For
example; pressure of UK government on privacy in the digital era has appeared as
increase in privacy regulations on Apple (Gürel and Tat, 2017). This external factor
limits the operation of the company as it enforce costly regulatory compliances.
 Policies and practices of Apple- Apple face legal issue regarding the practices and
policies on services that occurs after sales. Thus, Apple should emphasize regulatory
compliances and privacy protection in each and every product line and should address
current legal pressure on business. Legal challenges in policies and practices of Apple put
negative effect on existing products and break consumer base.
As analysing various macro environmental factor, it has been identified that majority of
factors provide opportunity to Apple Inc. and provide opportunity to expand the reach in
products and service market of information technology at global level. As per the legal factor,
Apple is involved in infringement under the copyrights and patents.
P5. Conducting internal and external analysis of Apple Inc.
Internal and external analysis of Apple Inc. looks at the factors that are present within the
organization. In the analysis, internal factors includes; strength and weakness of Apple Inc. in the
UK market and external analysis includes; opportunities and threats.

Strength: Strength refers to the internal, personal aptitude of the company. This is the thing
which is under the control of the company, or we can say the thing at which company is good at.
 Goodwill: Goodwill is the biggest strength of the Apple, as Apple is well-known for the
reliable product which has been introduced by the company in the market (Swot Analysis,
2015). The quality of the product and the service which is offered by the company is the
biggest reason regarding building a good goodwill and which as eventually resulted in
attracting the customer. Company builds a strong brand image in the marketplace.
 Innovation: It is the sole motive of the company is to bring new and innovative product
in the market and till now company is able to do the same as Apple has launched some
gadget which was new to the market and which has helped them in getting the
competitive advantage in the market. This the only one of the best element that make the
company different from other brands and make the products more efficient than other
products.
 Good Financial position: Apple is one of the four company who are best in the
technology and has able to earn a good profit in the past which has helped them in
building good financial position which helped the business in investing heavily in the
research and development which eventually help them in an increasing productivity and
revenue (Hillary, 2017). Effective financial position and performance influence decision-
making of the company and make them able to take effective actions in order to improve
the products and services that meet the need of consumers.
 Margin- One of the core advantage of the company is the margin that is command over
its products. Apple is a technological leader company with top brand equity. Along with
it, Apple always keep hefty margin for itself to invest in Research and development and
brand building.
Weaknesses: Weaknesses are the negative factor which hampers the growth of the business or
the barriers in smooth functioning of the business.
 High priced Product: The biggest weaknesses of the Apple is the price of the product
which is offered by them, Apple generally used to offer a high price product which is not
afforded by all the class of the people which eventually reduce the market area coverage
foe the Apple (Kolk, 2016). As the products target high income consumers, company is
not able to take decision that can target low to moderate consumers.

 Lack of Marketing: Apple generally does not invest in the marketing side of the product
which reduces their scope to tell the customer about the new and innovative product to
the new market. Apple always believe that they have build a good loyal customer base
which will never leave Apple company. But this element somewhere break the consumer
base or consumers are not aware of the new products or services of Apple Inc. Thus it is
an essential element that need to consider and Apple is required to invest in the marketing
strategy.
 Incompatibility to adapt software: Apple product are the product which does not
support all the software in their gadget which eventually makes customer dis happy about
the product which eventually reduce the customer base for the Apple.
Opportunities: Opportunity are the external factor which may contribute to the success of the
organization.
 Consistent customer growth: As the apple has single handy ruled the market of a
technology gadget in the last few it has helped the organization in prevailing their
customer. Apple has a good opportunity to grow their customer base with the help of the
technology and its up-gradation (Kosov and et. al., 2016).
 Artificial intelligence: Apple can use Artificial intelligence in the organization to have a
better profit margin and revenue as it will help them in improving the efficiency of the
work in the organization, Apple has acquired the Regained for the same purpose. Now
company should take effective decisions in order to implement AI in every operation,
services that make the process much easier.
 Green technology: It is the good opportunity for the Apple to introduce an environment
friendly product in the market which can help the organization in attracting more
customer toward the organization. The decisions should take by considering its effect on
society and consumer's mind. It also provides an opportunity to the company to being
responsible and able to limit the cost.
Threats: Threats are the external factors that reduce or limits the financial performance of
business. Apple as a company do not face any threat, but as product it is facing strong threat
from the competitors.
 Intense competition- the biggest threat for the company is the intense competition in UK
market such as; Samsung, Lenovo, HTC, Fitbit, etc. but the major competition that really

affects the company is Samsung (Laudon and Traver, 2016). It has been state as the
biggest competitor because Samsung provide high quality and value products and
services in much down price range from Apple. This is the only company that is able to
break the consumer base of Apple Inc. These element influence decision-making of the
company as intense competition put pressure on the leader to make effective decision that
make them able to beat the competition.
 Market penetration- This is one of the key threat by other brands in smartphone
segment. Android have high market share than iPhone that presents the threat. For
example; Android is eating 47.6% market share on the other hand iPhone is at 43%
market share.
P6. Explaining how strengths and weaknesses are interrelated with macro factors
Apple Inc. is one of the most visible and recognizable consumer electronics brand in UK
and serve all over the world with its innovative and quality products and services Apple Inc.,
2019). The macro environment and micro environment are interrelated with each other and also
responsible for each other. From both the environment, macro environment are uncontrollable,
whereas, company have control over micro environment. The strength and weakness that has
been analysed through micro environmental analysis are directly depends on the positive impact
of the macro environmental factor. On the other hand, negative impact of macro-environmental
factor on Apple Inc. acts as weakness or threat for the company. For example; Technological
factor is the biggest strength of the company and legal factors limits the operation of Apple Inc.
and lead the company to incompatibility to adapt software (Phadermrod, Crowder and Wills,
2019). Political stability is strength and opportunity for the industry to expand their products and
services as well as it ensure that company have smooth functioning and operations. Brexit is the
most affected external factor that weakens the operations and ability of the company to bring
innovation and add features in the products and services.
Both macro and micro factors, have negative and positive impact on business objective
and decision-making of Apple Inc. for example; innovation that is the strength of company and
on the other hand technological factor that provides opportunities to the organization assist the
business to accomplish the objective of being the market leader in technological products. On the
other hand, it presents intense competition towards the company that affects the operation of
Apple in negative manner. Apple has high skilled and trained employees and staff that able to

achieve the objective and is the biggest reason for the success of company. Technology also
assist the company to overcome their barriers and convert the weakness into opportunities. The
decision-making also influenced through government policies that limits the leader and manager
to consider privacy policy and practices before doing any innovation or introducing any features
to their products (Sammut‐Bonnici and Galea, 2015). The law introduced by government is
essential to consider in the decision-making process of the company.
CONCLUSION
As going through the study it has been summarized that, business environment have
influencive part of the organization that may be appeared as an opportunity or may be as threat.
In the context of Apple Inc. external factor have both negative and positive effect on the
business. It also has been concluded that understanding of the factors is important for Apple to
developed and implement strategies to cope up with the negative impact. Through SWOT
analysis it has been identified that Apple's brand name and products portfolio is the biggest
strength of the company. Along with it, it also has been summarized that macro and micro
environmental factors are interrelated with each other and affect each other vice-versa.

REFERENCES
Books and Journals
Barik, B. and Kumar, S., 2018. Macro Environment of Indian Life Insurance Business: A
PESTLE Analysis. Bimaquest. 18(3).
Deasy, S. and et. al., 2016. Controlling use of a business environment on a mobile device. U.S.
Evans, S. and et. al., 2017. Business model innovation for sustainability: Towards a unified
perspective for creation of sustainable business models. Business Strategy and the
Environment. 26(5). pp.597-608.
Fozer, D. and et.al., 2017. Life cycle, PESTLE and multi-criteria decision analysis of CCS
process alternatives. Journal of cleaner production. 147. pp.75-85.
Gürel, E. and Tat, M., 2017. SWOT analysis: A theoretical review. Journal of International
Social Research. 10(51).
Hillary, R. ed., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World Business. 51(1).
pp.23-34.
Kosov, M. E. And et.al., 2016. Socio-economic planning of the economy. Indian Journal of
Science and Technology. 9(36). p.102008.
Laudon, K. C. and Traver, C. G., 2016. E-commerce: business, technology, society.
Phadermrod, B., Crowder, R.M. and Wills, G.B., 2019. Importance-performance analysis based
SWOT analysis. International Journal of Information Management. 44. pp.194-203.
Sammut‐Bonnici, T. and Galea, D., 2015. SWOT analysis. Wiley Encyclopedia of Management,
pp.1-8.
Online
Apple Inc. 2019. [Online]. Available Through:<https://www.apple.com/uk/>.
Swot Analysis, 2015. [ONLINE] Available through< https://www.liveplan.com/blog/what-is-a-
swot-analysis-and-how-to-do-it-right-with-examples/>