Analyzing Apple Inc.'s Business Environment: A Comprehensive Report

This comprehensive report analyzes the contemporary business environment of Apple Inc., focusing on key elements of its internal and external environments. It utilizes a SWOT analysis to evaluate Apple's strengths, weaknesses, opportunities, and threats. The report delves into the functions of a market economy and the role of government, examining how these factors influence Apple's operations. Furthermore, it explores the economic environment within which Apple operates, including technological, economic, political, natural, and global factors. The report also discusses the benefits countries derive from international trade and assesses the growing impact of the European Union on British business. The analysis provides a detailed overview of Apple's strategic position and its interaction with various environmental forces, offering valuable insights into its market dynamics and future prospects.

Contemporary
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
Understanding key elements of internal environment and their interaction with external
environment.................................................................................................................................1
LO 2.................................................................................................................................................3
Identifying the functions of market economy and role of government within it.........................3
LO 3.................................................................................................................................................5
Examining economic environment within which business operates...........................................5
LO 4.................................................................................................................................................6
Reasons of countries benefiting from trade with each other.......................................................6
LO 5.................................................................................................................................................8
Growing impact of European Union on British business............................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Contemporary is that term which refers to as that part which belongs to a particular
period or time. Thus, to understand it in a better way its business environment has a vast and
huge market that is full of competition which changes at very fast pace (Ahmed, 2016).
Moreover, the owner of such business environment must have capability in order to understand
and identify the needs and requirements that has to be done in an organisation. In this report,
Apple Inc. has been taken into consideration. It is an American multinational technology
company that has been headquartered in California. The main aim of this organisation is to sell
consumer electronics, computer software and also online services.
In the following report, the key elements of internal environment that interacts with
external environment will be discussed in detail. Further, this report will also help in analysing
the role of Government in the functions of market economy along with the economic
environment within which cited business actually operates. In addition to this, this report also
highlights on benefits that countries enjoy while trading with each other and also helps in making
student aware of growing impact of EU on business that is performed by British.
LO 1
Understanding key elements of internal environment and their interaction with external
environment
Internal environment factors are those factors that occur basically within a particular
organisation and on the other hand, external environment factors are those that are termed as an
event that is taken place outside of the particular organisation. Therefore, external factors are
hard in order to predict and later to control (Boone, Kurtz, Khan and Canzer, 2019). Thus, key
elements of internal environment and their reaction with external environment has been
discussed as per below context with the help of SWOT analysis-
Internal environment
Strengths
 Leading innovators among electronic brands- Apple is the top most ranker in terms of
innovation of electronic devices. It has been termed as the most innovative company that
brings up with unique and innovative ideas in market that creates huge level of
competition. In addition to this, the cited organisation has been expanded in terms of
reaching towards the services that are related to environment and information. Therefore,
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due to this it has been termed as one of the largest retailer in terms of music streaming
and video and software solutions.
 High recognition of a Brand- Apple is the company that invested $4.5 billion for
Research and Development which helped them in order to access the market in close
manner (Caporale, Sova and Sova, 2015). This organisation therefore takes complete
control of supply chain which leads them in enhancing the brand image and increases the
recognition of a particular brand. In addition to this, it also helped customers in building
immense trust among them which helped them in achieving great and innovative versions
of mobile phones.
Weakness
 High Price- The price of a product which is produced by Apple is quite high and their
fans makes it as a premium gadget maker. Thus, it has been stated that this product is for
those people who afford pony. In other words, it has been analysed that cited organisation
has lost maximum amount of customers and this is because they have cheaper products
access as compared to Apple.
 Unsuccessful Anticipation- The founder of the cited organisation predicted that there will
be no person who will buy big or large screen phones. Thus, this prediction actually
failed which made them suffer huge loss. The other brands like Samsung launched
phablets and Apple only invested in tablets. Further, it has been analysed that the demand
for large screen phone is rising vastly.
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Figure 1: SWOT analysis
(Source: SWOT Analysis, 2019)

External Environment
Opportunities
 Growth in communication Device market- The cited organisation took a record 51% of
global Smartphone market share in the last period of a year. Thus it enjoys increased
demand in the market and their main objective is to provide high end products.
 High Demand of products- It has been estimated that there is a huge demand for products
of Apple and they do not try to sell low cost price phones in the market. The features and
physical evidence of their product is so unique that customers wait to buy their product
till it becomes available in a market. It has also been further analysed that there are
numerous consumers that are waiting to buy it.
Threats
 Damage of reputation due to tax scandal- Tax scandal make this reputed brand viral as it
was involved in it. Due to this, it was manageable for the stated brand to keep maximum
revenue in taxmen hands. In addition to this, the professional of tax made guesses in
order to analyse the source of revenues from its operations in foreign market.
LO 2
Identifying the functions of market economy and role of government within it.
The term market economy is defined as that economic system in which decisions related
to economy and pricing of goods along with services provided by particular organisation are
directed by individual citizens interaction and businesses of a particular country (Charter, 2017).
Thus, the main role or functions of government in terms of market economy includes high level
of efficiency, infrastructure, promoting equity and foster the macroeconomic growth and
stability. Hence, all of this functions has been discussed in detail as per below context-
 Efficiency- This is the first functions that is performed by government. Thus, it is the
stage where government must try to attempt so that they can correct failures of market
like monopoly and excessive pollution. This helps the cited organisation in order to
ensure the functioning of economic system in efficient manner. In addition to this, the
externalities occur when the cost is being imposed by Apple or benefits on others outside
the marketplace.
 Infrastructure- Infrastructure is that term that refers to as those activities that includes
enhancing, output levels or level of efficiency in a particular production. The other
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functions that is being performed by Government is providing infrastructure to the
country. Their main objective is to provide infrastructure in integrated manner. The main
and significant elements that are involved in this are transportation systems, power
generation, communication and banking, facilities related to health and educational and
government and political structure that are well ordered. There are various activities that
are financed by government as the cost of providing essential services is high so it has to
be financed by the government (Young ed., 2018).
 Equity- A particular distribution of income that is being regarded as a social fair or
equitable is not necessarily produce by markets. Here, the main aim and objective of the
economy of particular market is to produce high level of inequality in terms of both
weather and income. In addition to this, it has been analysed that the programmes of
Government uses taxes and spending in order to advertise equity so that they can easily
redistribute income towards particular groups of audiences in the market.
 Economic growth or stability- This is also the most important role or function that is
played by Government of cited country. Here, the government rely basically on taxes,
expenditures and also monetary regulation which lead them in fostering the growth and
stability of macroeconomic so that they can reduce level of employment and inflation that
leads in encouraging the growth of economic of a country (De Janvry, McIntosh and
Sadoulet, 2015). Further, economic growth and stability includes fiscal policies that
includes spending and tax along with some kind of monetary policies. These monetary
policies are those which affect interest rates and credit conditions. In addition to this, they
have got success in bring the employment level and inflation level under control.
 Maintaining competition- There are anti-monopoly laws are designed by government in
order to regulate the behaviour of a particular business that further leads in promoting
competition. Further, it has been analysed that competition is termed as an optimal and
efficient market mechanism that further aids in encouraging producers and also suppliers
of resources so that they respond towards price signals and sovereignty of consumers.
LO 3
Examining economic environment within which business operates.
Economic environment is that term which basically refers to as all types of economic
factors that basically affects both commercial and consumer behaviour. This consists of various
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external factors in the immediate marketplace and also the broader economy. Thus, they have a
capability in order to influence a business which shows the process that operates. In addition to
this, this leads in analysing their success and reputation that they have achieved in a particular
market (Domanović and Janjić, 2018). Further, economic environment within which the a
particular business operates has been discussed as per below context-
There are number of environments that pose threats to a particular firm and further offer
immense opportunities for potential market exploitation.
 Technological Environment- Updation in technology affects the operations of business.
This means the operating strategy has to be changed of a particular enterprise that will
bring out changing and innovative results in environment related to technology.
Technology is termed as one of the most systematic application. Thus, it becomes
significant for Apple to adopt the updated technology in order to stay connected with
recent trend that are upcoming in a particular market.
 Economic environment- The economic environment is the factors that pressure up the
habits of customers in terms buying goods and services of a particular organisation which
in turn creates huge impact on Apple. The running of a particular business and its
economic environment shares good and close relationship. Thus, economic environment
makes available all the needed inputs that are required by the business in order to operate.
Further, it helps in absorbing the outputs of various business units.
 Political environment- Political environment is termed as state, government and
institutions and legislations that lead in operating and interacting that influences the
system. It has also been identified the cited organisation would get impacted and affected
in positive way if the government policies of a particular country are stable and better.
Further, it refers to the political institutions that exert the influence among them that
includes legislative executive and judiciary in terms of shaping, developing, directing and
also controlling various activities of a particular business firm. In addition to this, it has
been stated that for the growth of any kind of business enterprise, a stable and dynamic
political environment is essential.
 Natural environment- The natural environment is also termed as one of the most
important factor that has to be taken into consideration in terms of running business.
Here, the natural resources are included that where uses in terms of inputs are involved
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that affects the marketing activities of Apple Inc. the main fear of this area is high level
of pollution, lack of raw materials that is required to produce high quality goods and
services and also the increased governmental intervention. In other words, business is
termed as an economic detection of man that basically continues to be dictated by nature.
 Global or International environment- Global or international environment is one of the
larger environment that comes under different sovereign countries having various factors
to the home environment that basically leads in influencing decision making use of
various types of resources and capabilities. In addition to this, business responses must be
positive and to the point in order to survive in the global environment.
LO 4
Reasons of countries benefiting from trade with each other.
The main reason when countries trade with each other basically only if they do not
have enough resources to operate in a market or capacity to satisfy their own needs and wants. if
a particular business goes international that would therefore provide them with bulk of
opportunities to business (Hamilton and Webster, 2018). Thus, advantages and benefits that they
enjoy while trading with other countries has been discussed as per below context-
 Increased revenue- Increasing revenue is one of the most top advantage in terms of
trading with each other internationally. Thus, potential clients and customers are
increased due to this which further helps the cited company to add new growth and
increase revenues accordingly. Further due to survey, it has been analysed that business
are increasing their revenue which makes them to increase their level of trading and hire
maximum employees for successful trade. This has made them successful and company
may reach the boost.
 Competition is decreased- The level of competition is low in other countries as compared
to domestic countries. Therefore, it becomes easy for the cited organisation to compete in
the global market and earn huge revenue in terms of money and also in terms of loyalty
base of member country. In addition to this, this also leads them in such way that they
think in a globally manner that further helps in increasing economy of a particular
country.
 Longer lifespan of a product- Sales of particular products that has been produced by cited
organisation dips domestically for certain product. The main reason behind this is
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Americans have paused buying goods as they require some unique product as per the
trend that has taken place in a particular market that has been stated. In addition to this, it
has been estimated that exporting goods in overseas market can increase their life span of
that commodity as they seek in order to buy American products.
 Easier cash flow management- This is termed as one of the significant advantage or
benefits that is enjoyed by them while trading internationally. Thus, while trade is taking
place asking for payment upfront becomes the general practice as compared to home.
This means that at home country they have to be more creative in order to manage the
flow of cash and has to wait long to be paid by opposite organisation. Therefore, it has
been stated through this that if an enterprise has to manage cash flow in adequate manner
than they have to trade internationally which will help them in this.
 Better risk management- The other significant advantage of this trade is diversification of
market. If the cited organisation focus on domestic market only than they may have to
face heavy risk from downturns in economy, environmental events, political factors and
many other types of risk factors. Therefore they must lack depending on single market
and must diversify their business so that they won’t face high level of risk and some kind
of risks is managed in adequate manner.
 Enhanced reputation- The reputation and image of one particular organisation is boosted
while performing business to other countries or while trading. Further, if they achieve
success in one country will help them in influencing success in other adjacent countries.
Thus, it will help in raising the profile of market niche. This will help them in raising the
trustworthiness in both areas either home or abroad.
 Opportunity to specialise- Trading internationally leads in opening up avenues for new
line service or products which further leads in giving up an opportunity in order to
specialise in various areas in order to serve that market (Harris, 2015). Further, if they are
exposed towards worlds realities than they can increase their level of innovation in home
or domestic country and also increase efficiencies for products and services.
 Access to export financing- Another advantage is that they are liable in terms of
managing exporting financing. The places in order to explore the export financing
includes export import bank of United States that is known as EXIM and The US
business administration.
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 Disposal of surplus goods- The cited organisation has an outlet in order to dispose surplus
goods which they lack in selling in home market. This leads them in selling all products
and earns revenue accordingly.
Thus, from the above details it has been analysed that to focus only on domestic
market may creates high level of risk.
LO 5
Growing impact of European Union on British business.
European Union is termed as union that has 26 members’ states which are basically
located in Europe (Lieder and Rashid, 2016). Thus, as per the complete analysis, it has been
estimated that after leaving European Union they would have to face huge impact in negative
way on inflows of Foreign Direct Investment and is decreasing by around 22%. Further, many
foreign investors has been attracted to the UK market as they lack in facing high cost barriers
from tariffs and can export to EU countries in easy way (Kenney and Zysman, 2016). There are
many ways in which Brexit affect business which has been discussed as per below context-
Wider marketplace and commercial issues has been discussed as there are number of
business that is facing changes in terms of labour market and also in terms of currency effects.
Further, the cost and availability of certain goods or commodities may change substantially. The
European Union is therefore termed as one of the single largest market in the whole world and
this means that every members of this union can perform or operate business and trade with each
other throughout other member states. Further, the benefits are therefore reduced or abolished in
terms of selling tax and freedom from other fiscal measures that are restrictive which states that
particular business enjoy higher volume of profits and revenues and can operate more freely
without any kind of deal government intervention.
Compliance with future tariff and trade requirements. Both exporters of goods and
importers requires measures in their place that leads them in complying with kind of additional
administration in order to pay kind of additional tariffs. One more important aspect of
membership of European Union is that companies from various other parts of the whole world
are still a part and bound of regulations and policies of respective European nations while the
business that are belonging to UK and other member states basically lacks. Moreover, it has been
analysed that the policies of European Union have also ushered liberalisation of policies and
those products which were actually prohibited from being traded can therefore be traded across
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various different EU nations in free and adequate manner. In addition to this, as per the medium
term perspective, the stock of capital is therefore adjusted to a higher level of productivity in
which it has been expected that price of goods will be reduced and output level will be increased.
Moreover, as per the barriers to capital mobility are declined, it has been estimated through this
that relocation of economic activity may be termed as a consequence that is possibly based on
matching the industrial and regional characteristics on the basis of factor endowments and is
based on market access considerations (Namada, 2018).
CONCLUSION
From the above report, it has been analysed that environment of particular business
splays significant role in analysing the success and growth of the business in a particular market.
Further, it has been analysed that Apple company has maximum strengths that is termed as the
great opportunity for them to make their place in global market and have some kind of weakness
which leads them in facing threats in that particular market. In addition to this, this report also
highlights on various advantages that they enjoys while trading in global market or
internationally which states that trading internationally would lead them in increasing brand
image of an organisation and company may reach the boost.
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REFERENCES
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