Apple Inc.

Global Supply Chain Management

Prepared by:
Group 6

Pankaj Pathak – 991646688

Rutuja Gaikwad – 991638707
Sahil Nijhawan - 991644058
Smita Dhure - 991645488
 KEY ISSUES
1 2

Increase in Expensive Apple

Competitors products
Apple Inc.
3 4

Poor Global Supply Control over

Chain Management Manufacturers
Recommendation

Innovative Products

Hybrid
Recommendation

Customers

Controlled Outsourcing
 Recommendation: Strength and Weakness

Strength: Weakness:
1. Control over Supply Chain operations like 1. Requires huge investment to setup new
Logistics and distribution. manufacturing plants.
2. Better Product Assembly lines. 2. Risk of failure.
3. Cheaper new iPhone models. 3. Geopolitical factors will create issues.
4. Lower price attracts more customers.
5. Spike in sales and revenue.
6. Save huge tax if setup in Tax Haven Countries
 Appendix 1: Alternatives

1 2 3
Deploy R&D team
Cheaper new to improve Limiting number
iPhone Models operation and of Suppliers
customer services
 Appendix 2: Analysis of Alternative 1

Cheaper new iPhone models

Strength:
• Attract more customers.
• Sales spike
• Opportunity to grasp unexplored countries
• Increase the demand, resulting in high Revenue generation

Weakness:
• Tight profit margin
• Might create a perception of using low quality products
• Failure risk
 Appendix 2: Analysis of Alternative 2

Deploy R&D team to improve operation and customer

services

Strength:
• Highly satisfies customers
• Improvement in brand value
• Attract new customers
• Minimizes the possibilities of obsolescence of products

Weakness:
• Increase in expenses
• Product failure
 Appendix 2: Analysis of Alternative 3

Limiting number of Suppliers

Strength:
• Better Control over Supply Chain
• Provide upfront capital in return for growth commitment and a lesser overall price per unit.

Weakness:
• The global supply management is decreasing due to external factors and involvement of different
competitors that provide better facilities and features in the product.
 Appendix 3

iPhone vs Other Services Comparison

Revenue in USD million 3,00,000

2,50,000

2,00,000

1,50,000

1,00,000

50,000

0
2015 2016 2017 2018 2019
iPhone 1,55,014 1,36,700 1,39,337 1,64,888 1,42,381
Other services* 78,701 78,939 89,897 1,00,707 1,17,793
Total 2,33,715 2,15,639 2,29,234 2,65,595 2,60,174
 Appendix 4

Apple Financial Ratios

70.00%

60.00%

50.00%

40.00%
Ratio (%)

30.00%

20.00%

10.00%

0.00%
2015 2016 2017 2018 2019
Gross margin 40.06% 39.08% 38.47% 38.34% 37.82%
Operation margin 30.48% 27.84% 26.76% 26.69% 24.57%
Net margin 22.85% 21.19% 21.09% 22.41% 21.24%
Current ratio 54.09% 47.96% 46.34% 48.56% 58.47%
Quick ratio 47.48% 42.24% 36.44% 41.49% 49.58%
 Appendix 5

IPHONE GLOBAL UNIT SHIPMENT

2009-2019
Unit Shipped

1600
1400
1200
1000
800
600
400
200
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
 Strength Weakness
• World largest corporation • High pricing
• Strong brand image • Limited distribution network
• Acquisition of several firms • Incompatibility of products
• Effective rapid innovation with other brand
• Strong customer loyalty
• Trained employee
• Huge expansion rate
• Minimalistic and simple

Appendix 6 – SWOT Analysis

Opportunity Threats
• Rapidly changing industry • Patent and copyright issue
• Sales growth in emerging • Less demands
economies • New and innovative
• Amazing record in US credit products from rival
card sales • Product imitation
• Market Fragmentation
 Appendix 7 – Justification of Recommendation

1. Launching Innovative products before its competitors will keep

Apple ahead in this competitive market.

2. Control over Global Supply Chain Management will improve

Apple’s Logistics and Distribution channel.

3. With innovative products and control supply chain Apple will be

able to reduce its price for the upcoming model and will target
huge audience.
Thank You