Apple's External Environment Analysis: Political, Economic, Social

This report provides a detailed PESTLE (Political, Economic, Social, Technological, Legal, and Environmental) analysis of Apple's external environment. The political section examines the impact of Brexit, European regulations, and US-China relations on Apple's sales and operations. The economic analysis discusses the impact of COVID-19, GDP, exchange rates, and economic growth on Apple's revenue and market share. The social factors include demographic trends, customer preferences, and the impact of social media. The technological analysis covers communication advancements, the App Store, and Apple's innovation. Environmental factors include recycling programs, pollution, and carbon emissions. Finally, the legal environment discusses privacy regulations. The report highlights both opportunities and threats, such as the increasing use of mobile access and social media versus lawsuits and environmental concerns, offering insights into Apple's corporate social responsibility and overall business strategy.

External environment
C.P4
Political:
Membership of trading communities such as the European Union- Since the UK leaving the EU,
Apples shares decreased by 2.8%. Along with that, NASDAQ (where Apple shares trade) was also
down by more than 4% and, the value of the British pound subsequently dropped. These factors
have hugely damaged Apples sales and their revenue and in fact they would not be able to maximise
their profits as they would have to readjust each products value by dropping their original price to
suit the current condition of the market to benefit their customers.
The European regulators have released a list of big tech companies who will be facing tougher
regulations in terms of market influence and includes Apple! The idea of the campaign is that the
larger the companies are (Apple being the largest on the list) they should share date and information
with their rivals and along with that, face tougher regulations. These factors would damage Apple as
they would have to give intel to other companies allowing them to gather knowledge of how Apple
functions and works, therefore, Apples market share could slowly decrease allowing other
businesses shares to increase
Apple has been manufacturing their products all over the globe but mostly in China. The reason is for
lower the expanses in manufacturing. This has also led to various objection as the political relation
between China and America has been through different views, especially in the recent months,
president Trump having a very negative view to China ever since COVID-19 was outbroken.
ECONOMIC:
ECONOMIC GROWTH- Believe it or not Apples GDP is higher than some countries! Switzerland, Saudi
Arabia, Netherlands, Indonesia and Mexico are all lower than Apple. Apples economic growth rate
have drastically dropped since then and its due to to Covid-19. The organisation had to close many
stores across the globe in which plummeted their revenue, they lost around $2.7 billion and this
drastically damaged their sales of the new brand-new iPhone 12 in which they dropped by 24.3%.
Apples response to COVID-19 allowed them to have committed donation in order to help treat those
who are sick and to help lessen the economic and the community as they reached $15million
worldwide.
EXCHANGE RATES- The value of the British pound, other known as Sterling has dropped quicker
than ever (Due to COVID19 currently), therefore, exchange rates have dropped too. Sterling fell 5%
to $1.15 which have damaged Apple stocks and their shares in which shareholders has panicked sold
in order to liquidate and not to make even more of a loss. If the stock’s price falls too much then
Apple may need to borrow money to raise funds to expand their business, however if the share
prices are still yet to change or continually dropping, shareholders will continue to be unhappy
towards Apple and they may leave and invest in other shares for example their rivals, Samsung.
SOCIAL RESPONSIBILITY:
DEMOGRAPHIC TRENDS- The average age of an Apple customers lies around the age gap of 35-44
years old. Apple users are 94% more likely to be affluent than others who utilize mobile devices on a

regular basis and that may be due to, their ground-breaking and innovate products with ultimate
fast software. 1 in 4 customers in the 18-34 age express a strong interest in purchasing an Apple
product and that could be because of their advanced technology that allows users to have the best
experience. Men outnumber women on 2:1 basis when it comes to purchase an Apple product.
CUSTOMERS TASTE/PREFERENCE- Globalization, allowed Apple to have a rapid increase in
popularity, therefore, taste in customer has never been important than ever before. Apple has
invested in millions in their design and software in order to satisfy and deliver in their audience
taste. The organisation has invested in $16billion in research and development, in order for their
customers to have the latest ground-breaking technology and to have the best experience when
using an Apple device. Apple products are extremely easy to use that ultimately a 5-year-old can
understand, along with that fact, fast software and advanced camera quality allows customer to
have the best experience with instant access of launch of apps.
Social factors that effects Apple business. The most significant factor to Apple is the rising use of
mobile access and the rising use of social media, these are two opportunities for Apple. Apple
continue to provide these mobile devices, the trend of increasing mobile popularity of mobile access
is an opportunity that Apple can utilise and to carry on expanding their business by generating even
more sales coming into the organisation. Moreover, in today’s world, social media is becoming more
and more populated so therefore, the rise of this trend will increase the demand for digital products
such as the iPhone where users are able to download lots of popular social media apps. This will
allow Apple to have major opportunities to sell their products in which can allow them to continually
to grow and increase the sale rate and therefore, beating their competitors and allows Apple to
please their consumers.
Despite these opportunities, Apple faces social threat of opposition against its business operation.
Questions are being asked of the business practices, such as lawsuits against third party repair
services and these sentiments have the potential to harm Apple’s brand image therefore, these
factors emphasise the importance of Apple corporate social responsibility strategy and such
strategy, helps satisfy stakeholders, including customers.
In this current environment involving COVID-19, people are more likely to save their money in order
to buy necessity such as food, anything involving day to day basis or to plan ahead in the near future.
This will affect Apple due to the fact; consumers are less likely to buy an Apple product now as
before due to the current conditions in the environment in which will influence them not buying the
products as they do not necessarily need it or instead of buying a costly product, they could
purchase other things in order to maximise their money in which will benefit them with the current
condition they are in and this damages Apple sales rate in which, they will lose out sales revenue and
competition will gradually increase and from them to perhaps lose out in the market share. Apple
products and the demand of the goods has dropped by 28%, and has lost around $4-7 billion due to
COIV-19 and people not buying the goods. People are spending their money highly regarding to
technology products and Apple being a technology business it will affect the business in a positive
note as this means, they have opportunities to exploit the market and to sell the products to their
audience. Apple products is showing a success in the market in which, allows the business to
generate sales and to compete with their rivals in the market.
TECHNOLGICAL CHANGE:

IMPROVED COMMUNICATION- Apple has changed the world due to their advanced development of
understanding technology and communication has benefited billions of people across the globe.
Their continuous change of each of their product has evolved and has met their audience demands
in which they have pleased them with and here are some examples;
FaceTime, the video quality is superior to any other video app, with 720p allows customer to have
the great quality and is supported with many Apple devices such as; iPhone, iPads and MacBook’s
however, facetime is only supported with an Apple product therefore, people trying to facetime
others without an Apple product will not be able to.
App store has millions of apps on communicating such as; Snapchat, Instagram, Twitter and others.
Allows customer to communicate to others and along with that, allows people to communicate with
other mobile devices such as Samsung and Hawaii.
Technology is a massive influence, especially Apple. Technology is constantly changing therefore,
businesses like Apple need to keep up with these changes and need to be able to integrate when
needed to. These factors are analysed so the businesses can understand how consumers react to
different technological trends and how they use them for their benefit.
Apple has a great opportunity to grow its app store and they have even come up with things like
voice recognition and face identification to unlock their phones which keeps them a step ahead of
major competitors, Samsung. Apple is in a very good condition to exploit the opportunities in the
technological business environment and grow as a business. These factors have made Apple to be
unique as they were the first companies to launch the first smartphone along with, touch ID and face
ID in which has driven up their sales massively and has allowed them to grow and expand the
business.
Technology affects Apple ability to communicate with customers and within the organisation. Apple
being a technology organisation has allowed them to upgrade and improve their technology in
which, employees can easily interact with clients quickly and clearly such as Apple’s website. When
customers use technology interaction with Apple, the business benefits from it because, better
communication creates a stronger public image therefore, installs trust and confidence to their
consumers in which, increase them becoming loyal to the brand and helps to increase sales.
Another factor is that, Apple using technology has allowed their security to be at the safest.
Technology can be used to protect Apple financial date, confidential decision and other important
information that leads to competitive advantages. Technology has affected and improved Apple’s
security, that it has allowed to keep their ideas away from their competition by having computers
with passwords and ensures none of its forthcoming projects will be at risk.
ENVIRONMENTAL FACTORS:
RECYCLING, POLLUTION AND CARBON EMISSION- If you have an old Apple product you would be
able to recycle it by heading over to their website called “Apples Recycling Program site” in which
there are a list of several countries where Apple offers recycling or trade-in programs. Customers are
able to trade in their old technology for a return of an estimated price of the value of the product
handed in
The climate change has impacted Apple due to the fact; it can influence on harsh weathers such as
floods, droughts, extreme heat wave and storms therefore, becomes a safety risk for workers as

they could be harmed and Apple will lose out in sales if their stores are damaged. Pollution also
affects Apple due to; it causes major environmental events in which, can disrupt of supply chain or
an increase in raw material. Apple have taken an opportunity from it. Apple has reduced the carbon
footprint emission in which has allowed them to become eco-friendly business. The reason why this
is important is due to the fact, reducing the emission of the CO2 level will reduce pollution and help
reduce climate change in which will benefit the wild life, people and decreases harsh weather
conditions.
Another factor is that, Apple becoming an environmentally friendly business it has attracted a lot
more customer and their organisation has stood out compared to their competitors. This has
allowed Apple to gain a good brand image that their audience understands that the business is
looking after the environment therefore, it has driven sales due to the fact, plays a significant role in
influencing consumer choice therefore, drives Apple sales as more people are buying Apple products
and along with this, motivates their staff due to, they understand the business is having a positive
impact on the environment in which, influences staff members.
Apple has developed a PET recycling program in which uses waste film liner material, used to protect
iPhones. Reusing the liner allows Apple to eliminate 200 tonnes of solid waste each year. Apples
energy efficiency programme which trains suppliers to find opportunities that slashes their energy
usage and carbon emission. Increasing the amount of recycling and decreasing the amount of carbon
emission allows Apple to have a control of pollution rate to be low.
LEGAL ENVIRONMENT:
PRIVACY REGULATIONS- Governments are realizing the privacy issues connected to technology
therefore, as a result, it creates a threat towards Apple as it creates a challenge in developing their
products that involve transmission of private information. Governments are also imposing a stricter
telecommunication regulation, which is a threat to Apple as it can potentially limit the usability of
their products such as, the iPhone will need to have a strong privacy setting.
LEGAL CHALLENGES AGAINST POLICIES AND PRACTICES- Apple faces legal challenges related to its
practices and policies on after sale service and other areas of the business. For example, in Australia,
the European Union, and the United States, the company has faced strong criticism and legal battles
regarding its policies on third-party repair services.
Labour- Apple has been discovered multiple cases of child labour in its supply chain and along with
they also were discovered cases of juveniles being used to lift heavy goods, workers having their
wages docked as a punishment and one factor dumping waste oil in the toilets.
LAWSUIT- A French organisation has finned Apple 25 million euros (£21m, $27m) for deliberately
slowing down older iPhone models to push customers to buy its new devices. The French antitrust
authorities also ordered it to pay a fine of 1.1billion euro for anti-competitive behaviour. These
examples demonstrate the consequence of not abiding by the rules and regulation.
Partnership legislation- Sets out that all partners share the responsibility for the business and for the
decisions which affect the business. This allows all partners within Apple to share all responsibility
such as decision making in which each partner has the right to equally contribute to matters that
affect the day-today running of the business. This can affect Apple due to the fact; it gives more

information and ideas of how the business should be run and they are all responsible to the idea if
anything happens.
Competition legislation- Apple need to comply with in relation to how they compete in the market.
The legislation positively impacts a business as it maintains competition allowing Apple to improve
and develop in order to remain a strong competitor in market. The anti-competitive conduct ensures
that aims to reduce competition therefore, can affect Apple such as: it allows to reduce competition
in which allows Apple to grow and expand as a company more easily therefore, gaining more
recognition from consumers and allows them to generate sales and to gain profit.
Industry regulators- To keep a close eye on industry prices and products to ensure they don’t take
advantages of consumers. This can affect Apple as being an advanced technology business they have
to make sure their price their selling the product is suitable to their audience and if not, these
consumers can easily change and enter a rival’s firm in which offers a more suitable price therefore,
increase competition and loss of sales or the business can be heavily finned.
Government departments- Taxes can affect Apple such as: it has an impact on how much profit
Apple makes, the business location can affect Apple too due to, local level can influence the business
growth such as Apple stores on London therefore, they would have to pay a lot more compared to a
location with little popularity. Apple is required to pay taxes for unemployment and these tax rates
can influence whether Apple chooses to hire workers or not to.
INTERNAL ENVIRONMENT
Corporate Culture:
Apples structure has encouraged rapid innovation and technological advancement which had been
used and adopted by a hierarchy that favoured a flat structure, and these are the reason why they
opted for it;
- Largest tech organisation in the world Apple needs quick and easy ways to communicate
between employees as there are fewer layers.
- Removes excess layers of management allowing the industry to save money, controlling
budget cost.
- Encourages quicker decision-making calls.
- New products and services reach customers faster.
- Creativity of employees are encouraged as they work independently and pursue their
passion.
Apple has been known for a high-level understanding of technology in which they have
fantastically developed in which they have changed the world of how it was viewed. Apple
has been mainly known for its intense focus on performance and productivity. Steve Jobs
believed in maintaining a very high level of professionality in which he was known for his
relentless pursuit of perfection, he was continually interested in hiring the best, paying them
well, retaining them and to have the best and smartest minds in his organisation. Ever since
Tim Crook took in control (replacement of Steve Jobs) his focus in terms is more on creating
a satisfaction for employees. Now Apple has a fast-moving, innovative, cutting edge and a
confident culture with a growing focus on employees’ personal satisfaction.

Apple has specific branches for employees to focus in and for them to imply their knowledge and
information which allowed the industry to work at their optimal best. Some of the branches of Apple
are;
- HR department, Apple wants to hire a diverse, independent and talented people in which
they look at what background skills they have and place them in the correct sector etc sale.
- Sales, the department is responsible for generating revenue and is tasked to ensure the
product is going to be sold and to create a profit.
- Accounting and sales, they are responsible to have records of Apples transaction of how
money is being spent and being entered into the organisation.
- IT, they are responsible for providing the infrastructure for automation, the use of network
and operating systems for Apple
Corporate social responsibility:
Apple has various policies, which provide guidelines and of a working CSR. For instance, Apples plans
entails funding of various programs in the community and promoting the condition of the
environment. CSR has various programs that includes supports for local communities. Apple adopted
the Global Volunteer Program, which has seen over $78 billion donated since its launch. The support
allowed local communities creating a reputable brand image alongside, provided helpful in the
maintain employee happiness knowing that Apple has given back to the society in which helped their
own company to evolve and expanded to become one of the wealthiest business in the world
Training and developing workers, Apple puts a lot of emphasis on development on training for their
employees. Reason why is due to the fact, the company operates in a relatively competitive
technological industry, which requires expertise and professionalism in the handling of customers. In
a year, Apple have trained around 280,000 workers in over the fifteen factories across the world.
Apple empowers their workers in a bid to improve their satisfaction. The employees in return ensure
that customers are well handed, which promotes brand reputation.
Waste reduction and recycling. The company adopted various techniques and projects to reduce the
amount of pollution, Apple adopted a robot that uses the minimal time to remove component of a
phone for recycling. This has been taken a good move as it ensures Apple do not end up polluting
the environment.
Apples health and safety is their number one responsibility. The organisation is permitted to look
after their employees’ health by providing them with certain training in order for them to be safe.
Official statement is “Apple is committed to protect the environment, health and safety of our
employees, customer and the global communities where we operate. We recognize that by
integrating sound environment, health and safety management practices”.
Apple ethics however, have been noted as being unethical in the past and recently the organisation
has been accused of overpowering employees’ long hours and having dangerous working conditions
in its suppliers in China (totally ironic and against their health and safety laws). The first reactions
were voiced in the media in which Apples iPods were being created. It was affirmed that the Apple
workers were gaining as minor as $50 per month, as they were working 15 hours per day!
COMPETITIVE ENVIRONMENT

Competition:
LOCAL- Apple is operating in a very competitive environment. Apple has many local competitors
such as brands as Microsoft, Dell and Hp all American based company’s.
The competition between Microsoft and Apple has been a hard-fought battle that has influenced
customer to have hard decision in which PC’S to buy however, Apple made sure customers to
purchase their products due to, Mac computers are easier to repair which allows customer not have
a long waiting time for their products to be used again. Apple computers have fast software,
beautiful display screen and an impressive trackpad that allows customer to have an attraction of
design and due to fast software, it allows customer to have instant access of apps.
Reason why customers purchase Macs compared to buying dell is due to three reasons. Mac books
are lightning fast quick, customer have instant access of launching apps without any problems. Built,
the laptop is very light to carry and allows customers to bring it into work without any trouble.
Customer support, the service offered by Apple includes telephone support, online and support at
retail stores where you can book an appointment, allows customer to have assurance that they
option in which support the want.
The competition between HP laptops and Apple MacBook’s has been so tight that customers are
finding it difficult which one to buy however, Apple has influenced customer to purchase their
product due to, their build and designs, MacBook’s come with an aluminium unibody that allows
laptop to feel strong also, they are lighter in weight which allows customer to carry the product
without any difficulty.
INTERNATIONAL- Due to being a multinational business, Apple has competitors across the globe and
ultimately their biggest rivals are Samsung (South Korean company) and Lenovo (Chinese company)
The ultimate battle in which mobile device is better, the iPhone or Samsung? Apple has influenced
their audience to purchase the iPhone by reasons of, fast software. iPhone holds a A12 Bionic Chip in
which beats the Samsung device, faster software’s allows customer to be satisfied as apps have an
instant launch without any delay. Apple Pay is the most popular method for make mobile payment
therefore, if customer have forgotten their debt cards, they could simply use the app.
Factors influencing competitive advantage:
Differentiation- Apple is trying to increase market demand for its products through differentiation,
which requires its products to be unique and to attract consumers. The company's products have
always been designed to be ahead of their competitors. Apple succeeded in creating demand for its
products. The company controls prices through product differentiation, innovative advertising,
guaranteed brand loyalty, and hype about new product launches. By focusing on customers who are
willing to pay higher prices and maintaining a premium at the cost of unit volume, Apple also sets
artificial barriers to entry for competitors.
Brand recognition- The company has gained such a strong brand recognition and reputation through
its advertising and marketing capabilities. Apple's outstanding ability to create marketing campaigns,
advertising capabilities, high-quality products, and the ability to provide an excellence in customer
experience have enabled the company to establish the world's most powerful brand therefore,

retained their customers and for them to become loyal in which drove down competition and
increased Apples’ market share along with increased their revenues and sales.
Technology relationship with customers, market share and market leadership- Technology has
influenced the way Apple communicated with customers. It is important that they must interact
with customers on a regular basis to win their trust and win customers. Through the use of the
Internet and social online networks, Apple has interacted with consumers and answered questions
about the product. Establishing effective communication with customers can not only establish a
good relationship with customers, but also establish a good brand image. Good relationship allows
customer to be satisfied with Apple and more likely to be loyal therefore, decreases the chance of
them joining a rival’s firm, decreasing competition. It allows Apple to increase their market share as
more customer are becoming loyal therefore, shopping at Apple more often in which results for
them to dominate the technology market and having a stronger market leadership.
Technology relationship with employees- Technology has influenced the way employees work,
makes them more efficient. Being more efficient allows employees to increase productivity and
improves job satisfaction resulting in a good relationship between Apple and employees. Employees
could use online message such as email to communicate to other employees or mangers to address
their point instead of writing as it saves time and is quick and easy to use.
Technology relationship with suppliers- Apple can communicate to their supplier via emails or text
message and allows the suppliers to receive the message instantly therefore, no misunderstanding
can be placed and builds a healthy relationship as they are communicating effectively.
Maintaining a competitive advantage will allow Apple to drive profit. Building and maintaining
competitive advantage attracts customers, contributes to fair prices and generates loyalty. Apple
created a competitive advantage through low prices or differentiation. A benefit of competitive
advantage, allows Apple to maintain a fair price in which, if their prices are fair to their consumers, it
will attract them in order to shop for their organisation instead of their competitors therefore,
generates sales revenues and decreases competition. This is important as competitive advantage
keeps customers coming back over and over again and this allows customer to become loyal to the
organisation in which, represent a good image of the business therefore, more and more customers
will be purchasing an Apple product therefore, increase sales and allows Apple to maintain the
market leader. Another benefit to competitive advantage is that it allows Apple to go through
differentiation. This allows Apple to separate them from their competitors in which a unique selling
point proposition makes differences clear and compels them to give Apple a strong brand
consideration. Apple USP is there IOS and their app store therefore, makes consumer attracted to
them as Apple’s app stores is the largest.
C.P5
SITUATIONAL ANALYSIS:
5C’S:
Company- Apples’ business is all about satisfying their customers’ in which by supplying them with
state-of-the-art technology. Products likes of iPad, iPhone, Apple watch, Tv has allowed the business
to be the most successful organisation in the market.

Collaborators- Apple work with large number of suppliers from different countries likes NXP from
Netherlands, FOXCONN in Taiwan and GOERTEK in China. However, Apple and FOXCONN violated a
Chinese labour rule by using too many staff to manufacture iPhones.
Customers- Understanding customer’s needs, want and buying patterns is important to Apple as
they are the key source to their success. Apple has spent $16billion in RND in order to satisfy
customers towards their taste and their preference. Satisfying customers allows them to be more
likely loyal to their brand in which, decreases competition for Apple.
Competitors- Main competitors are likes of Samsung, Microsoft etc. These competitors could
influence customers to enter a rival’s firm as they undercut Apple price and offering a better deal in
order to increase their sales, market share and to put pressure on Apple.
Climate- Apple is affected by multiple macro-environmental factors. For instance, the trade war
between USA and China or the weak economic condition in which impact consumers spending
power.
SWOT:
Strength- Apples’ strength is that the brand presence of the company is one of the strong reasons
that makes it the most power organization in the world. Apple delivers their products across the
globe and have billions of customers. Apple products are in high demand due to the fact, their
ground breaking and advanced technology’s allows customer to have the best experience.
Weakness- Weakness is that Apple products are very expensive, and the products may-be exclusive
for mid-high incomers. Apple products do not support other software compared to the android in
which may influence customers towards android.
Opportunities-, rise in new customers allows Apple to increase their market share in the technology
market. Technology is the future for the world, artificial intelligence. Apple being a technology-based
organisation allows them to be prepared for the future as it allows the business to continually grow
and to dominate the market share.
Threat- Threat, existing competitors such as Samsung, Asus, HP, Microsoft, Sony etc are giving tough
competition towards the brand as these companies are giving the same features such as touch id,
face id etc. Apple not supporting other software’s may influence customers to buy an android device
as it compatible to many software’s therefore, Apple may lose their audience and competition to
increase as, customer enter their rivals’ firm. Firms may sell their products at a cheaper price
therefore, allows customers to purchase other rivals products in order to save their money, in which
allows Apple to lose out their revenue and their sales.
FIVE FORCES:
Competition- Level of competition for Apple in the technology market is high. The organisation
directly competes with likes of Samsung, Microsoft, Google and many more. All these companies sell
similar technology therefore, the competitive force is very high. To keep up with competition, Apple
uses marketing in order to highlight products that will satisfy their audience therefore, they can
retain their customers and for them to become loyal, as it grows the business, in which contributes
them dominating in the market share and beating their rivals.

Bargaining powers of buyers- Customers want the best technology they can get; Apple provides the
most advanced and ground-breaking technology in which allows their customers to have the best
product available. Customer have a low bargaining power towards Apple due to their advanced
technology, in which allows them to be satisfied towards Apple, as a result lead Apple to have many
loyal customers purchasing their product even if at a high price.
Bargaining powers of suppliers- Suppliers have a weak force of bargaining powers due to the fact, if
they charge their prices too high, Apple can simply reject the offer as well, due to having strong
brand the organisation can simply scout other suppliers who may sell at a cheaper price and offers
better supplies.
Threat of new entrants to the market- Threat is relatively low due to the fact, the market place runs
at such a high cost and for a new business to maintain that would be simply impossible, as new
entrants are competing at such likes of Apple, Samsung, Dell, Google, Sony and many more. New
entrants would also need to have a huge amount of capital to spend on RND and to manufacture
their products before even thinking to generate their sales and revenue.
Threat of buyers opting for a substitute product- Threat is relatively very low however there are
some threat. iPhone holds a camera feature in which customer can substitute the product of using a
digital camera to take pictures. Overall customers would use an iPhone due to the fact; it holds all
the features in one product for example, camera, phone calls, facetime, games and many more.
D.P6
DIFFERENT MARKET STRUCTURE
Market structure:
Imperfect competition- Apple operates in an imperfect competition. The organisation operates in an
oligopoly market. Oligopoly market entails a few large firms however, the main firm that competes
with Apple is Samsung. These two firms dominate the market in which Apple is the market leader in
the technology industry but closely behind are Samsung. The competition is relatively low due to a
high entry barrier therefore, new business will not be able to exist of such conditions. Apple can
charge higher prices towards their customer due to fact; there are only a few firms that compete in
the market therefore, allows Apple to maximise their profit however, needs to be careful as
Samsung can undercut their price and offer a better deal which can result in Apple losing their
audience and a loss of sales. Apple has responded in the changes of market such as the prices of the
product in which Apple have readjusted their prices to benefit their customer and retain their
audience therefore, to carry on dominating the technology industry. Responding in changes in the
market allows Apple to be up to date in the market and to carry out what is needed in order to
expand their business.
Features of different market structure:
Number of firms- Apple has around 500 firms across 25 countries and regions likes of, China, France,
Germany, England and many more, with the first location opening in May 2001. It has influenced
Apple to have more opportunities to expand as a business in which led them to increase their
revenue and their sales due to fact, it allowed the organisation to have new customer across the
globe and new customers to be loyal to the brand and for that, helped Apple to grow and allowed
them to increase their market share and increased their brand.

Nature of product- Apple is a business of designing, developing, producing, selling and marketing of
its products and service. Apple wants their customers to have ground-breaking and state of the art
technology and this has allowed their customers be extremely satisfied in which has influenced
Apples’ brand as in fact, customer became loyal to the firm in which has driven down competition in
the market and allowed Apple to increase their revenue and profit. It Led the company to be the
market leader in the technology industry and have the most shares in the market.
Relationship between demand, supply and price
Influences on demand:
Affordability- The affordability of the Apple product is quite high; the average price of an iPhone is
valued at $758 and the product may be targeted to families with relative steady income or higher.
Due to such a high price, you would normally think the demand of the product would be relatively
low due to the outrageous price tag however, Apple has retained their customer because of their
advanced technology in which, allows their audience to have the state-of-the-art technology and
lighting quick software which had a massive influence on customers to purchase an Apple product.
Many of the customers have become loyal to the brand in due to that reason, which has drove down
competition and allowed Apple to dominate the market.
Competition- Apple has a relatively low competition due to such a high entry barrier in the
technology market however, their biggest competition is Samsung. These two firms have been
competing in the market in order to convince customer on why they should buy their products.
Apple have used many techniques in order to convince customers to join their firms instead of their
competitors, such as:
- Releasing Air Pods, a wireless headphone. It allowed customers not to have a struggle of
untangling any wires in which customers can easily connect their Air Pods to ANY mobile
device.
- Due to connecting to any device with an Air Pod, allows the customer not to worry if they do
not have an Apple device in which they can still use the product and feel they are a part of
the Apple business.
- Facetime allows customer to connect to friends across the globe however, they must have
an Apple device.
- Apple Pay, customer can pay for numerous items with Apple pay and gives them flexibility of
choice of method of paying.
Apple have understood their customers’ demands and has changed the market completely
by placing an A7 chip inside an Apple software in which has allowed Apple product to be the
most advanced technology in the market which has beaten their rivals. Customer has
demanded numerous times of picture quality to be improved in Apple products. The
organisation has completely changed the market by having a dual camera system which has
a 12-megapixel wide lens and has improved the LED lens in which has allowed customer to
be satisfied with the camera quality.
Level of Gross Domestic Product (GDP)- Corona virus has impacted on Apple’s GDP massively; the
organisation has lost around $180 billion in the market and along with that it is the biggest loss for
any company ever. Apple had to respond in the change of the market in which led them to close
around 450 stores across 21 countries in order to minimise the spread of Covid-19. These factors

resulted in Apple to lose out sales in which has damaged their market as they could have been
growing as a business and to increase their rival’s competition in which could have allowed Apple to
continue to dominate the technology industry.
Influences on supply:
Competition for raw material- Competition for raw material for Apple is relatively low due to the
fact, high barriers to the entry market allows Apple to have a low competition therefore, not many
businesses are entering the market which has allowed competition of raw material to be low. On the
other hand, rivals such as Samsung could increase Apple competition due to the fact, they can offer
better prices to the suppliers which could influence the supplier to stop working with Apple which
could increase competition for raw materials and also increase competition between the two
businesses. Due to Corona virus it has led raw material to be supplied low, Apple had to respond in
the change in the market which they had to pay more in order to gain the raw martials and offering a
better price than their competitors as they were doing too paying a lot more.
Government support- Due to the Corona virus, it forced Apple to shut down 450 stores which left
millions of people without work however, due to the Government support of a holding a furlough
scheme, it has enabled employees to receive an income in which has allowed them not to feel
helpless and not to struggle.
Availability to produce profitable- Apples brand is known as a technology business in which sells
advanced technology and due to that reason, it has allowed the business to produce profitable. High
revenue in which Apple reported of a net revenue of $215.64 billion which is a substantial amount
along with that, Apples gross profit generated around $84.26billion in which has allowed the
business to produce profitable. These sales allow Apple to grow as a business and to continue on
manufacturing Apple devices in which allows the business to create more products and to generate
sales and revenue. Yet again Apple had to respond in the change in the market as they lost around
$180billion in revenue therefore, Apple had to slowly open some stores offering face mask and hand
sanitisers in order to protect customers and to slowly gain sales in order to respond the market
change.
Elasticity:
Price elasticity of demand- The demand of the iPhone has substantially increased. Demand for the
product is very high in which has allowed Apple to increase the products price. Customer were
impressed with Apple due to the their ground breaking products in which, has allowed consumer to
pay almost any price for the product in which has allowed customers to be satisfied with the product
and become loyal to the brand. The price of the original iPhone was valued at $499 and to this day,
an iPhone 12 is valued at $799 and the demand of the product has never been high as before.
Pricing and output decision:
Impact on pricing and output decision on different market structure- Apple being in the oligopoly
market, determine the output decision depending on the demand for their products. Apple has
allowed their products to have a high price tag due to the fact, the oligopoly market is shared by a
very small number of firms likes of Microsoft and Samsung, Apple’s main competitor. These firms
offer, close substitute hence they are a threat to the industry. Rivals can influence Apples price in
which, they can push their prices down and start to create a price war therefore, Apple needs to
readjust their price tag in order to retain their audience. Apple’s price tag on their product is high
because, there is only a limited number of firms who sell similar product to Apple and along with