Global Supply Chain: Apple Inc.

Introduction

The purpose of this report is to discuss about the global supply chain for Apple Inc. as a case study. The case study of global supply chain of Apple would help to increase knowledge and understanding as how it is effective to provide its products to the valuable customers. The global supply chain is a network of supply of goods and services across multiple countries of continents. In the global supply chain, the flow of information and processes as well as resources is involves to reach towards customers across the globe. In the case of Apple Inc, its global supply chain is very strong that support this company to take competitive advantage in the global market.

Case Study Global Supply Chain for Apple Inc

The global supply chain is considered as the most important network of supply of goods and services of a company to expand its business and presence in the global market. The global supply chain is important to increase the sales of the products and maximize profits of the company effectively and efficiently. The example of global supply chain in the global market can be identified as food and beverage, oil and natural gas corporations, electronic companies, etc. Apple Inc is an electronic and communication technology company of the world that has a strong global supply chain to sales and products and services (Australian Institute of Company Directors, 2022).

Apple Inc is an American based multinational technology company that is specialized in designing, developing/manufacturing and sales of consumer electronic products, software and online services. Apple was established in 1976 and it is now a most valuable company in this world because of a second-largest mobile phone manufacturer and fourth-largest personal computer vendor. The main reason behind the success of this company in the world is its technology and quality of the products and services as well as global supply chain (Australian Institute of Company Directors, 2022). The global supply chain of Apple is a key aspect in which the use of multiple suppliers for the same component is the supply chain strategy of this company.

In supply chain strategy of Apple, the role of boards and directors play essential role in supply chain management and performance of the organization. The effectiveness of global supply chain has provided multiple rewards to the company. In its global supply chain, extensive network of third party suppliers can be identified that are around 785 suppliers at the global level. The global supply chain of this company is present in around 31 countries worldwide in which top 200 suppliers of Apple supply the products and services in global market is 97% and rest of its suppliers contribute in procurement, manufacture and assembly is 3% (Australian Institute of Company Directors, 2022).

The agreement with its key suppliers in global supply chain can be seen as exclusively long term basis because they take responsibility to secure proper supply of raw materials and high volumes of production. The bases of manufacturing of products of Apple are in China and Taiwan considers new manufacturing partners in its diversified supply chain. However, the main focus of this company towards secured multiple suppliers in global supply chain is based on key components for new products (Australian Institute of Company Directors, 2022). Further, in global supply chain of Apple, it invests in customized manufacturing equipment and milling technology on the priority basis to diversify them and take advantage in increasing product sales.

The selection of multiple suppliers of Apple at the global level provides key advantages over its rivals for supply of same components. The advantages of global supply chain system of Apple because of multiple suppliers can be seen as mitigation of supply chain disruptions and delays (Peerless Media, LLC, 2013). Therefore, the gross-margins of the company are maintained effectively and efficiently. The existing suppliers assist Apple through making adjustment of order ratios and minimizing risks of issues generated by third party. The multiple suppliers’ dependency of Apple in its global supply chain helps to increase production capacity quickly and fulfill the demand of customers in the global market.

The global supply chain for Apple Inc, suppliers of this company helps to outperform at the international level because of good relationship with them. At this stage, the supply chain model of Apple helps to learn how to increase performance of the company in competitive marketplace. In the case of global supply chain of this company, raw materials or components are provided by multiple suppliers in a centralized location first after that development of electronic products, such as iPhone, computers, laptops, and other equipments are conducted effectively (Peerless Media, LLC, 2013). The central location of manufacturing plant of Apple in the world is in Zhengzhou, China.

At this location, various suppliers shipped the materials and components using convenient transportation systems in order to save time and costs of supply. The finished products are now distributed at the global level from manufacturing site to consumers directly. The FedEx or UPS are used by the company to ship the products to the customers directly or sent to the main central warehouse facility of Apple in Elk Grove California. From the central warehouse Apple, the products are supplied using Apple stores present in 31 countries worldwide. Apple also tries to be environmental friendly company in its global supply chain (Wilson, 2012). Therefore, it also recycled the old iPhone or an old product when consumers want. At this stage, consumers get opportunity send back the old products to the Apple stores.

At this stage, the global supply chain of Apple is beneficial for the company as it is helpful to maintain strong relationships with its supply chain partners and consumers at the global level. The global supply chain system of this company provides great flexibility to fulfill the demand in the market. The large production capacity of Apple allows it to provide products in the situations of demand of the customers (Wilson, 2012). The extensive network of third party suppliers of Apple in its global supply chain is the backbone that assists this company to arrange components and materials and shipped to the assembling plant easily.

The establishment of high standards of global supply chain of Apple is possible because of managing supplier relationships in effective ways that help to control its 800 production facilities worldwide. As a long-term supply chain leader, Apple has established the value chain of its primary and secondary activities in the market. The primary activity of Apple in its global supply chain can be seen as inbound and outbound logistics, and business operations, including marketing & sales and service. The marketing & sales activities of the company are mainly responsible to sell more products and increase the value of Apple in the market (Wilson, 2012). The secondary activity of this company is related develop infrastructure, HRM, and development and procurement of technologies effectively and efficiently.

Conclusion

After discussion about the case study global supply chain for Apple Inc, it can be stated that supply chain is a key aspect in which the use of multiple suppliers for the same component is considered on the priority basis. In supply chain strategy of Apple, the role of boards and directors play essential role in supply chain management and performance of the organization. Further, the selection of multiple suppliers of Apple at the global level provides key advantages over its rivals for supply of same components. The global supply chain for Apple Inc, suppliers of this company helps to outperform at the international level because of good relationship with them.

References

Australian Institute of Company Directors. (2022). A case study of Apple’s supply chain. Retrieved from: https://aicd.companydirectors.com.au/advocacy/governance-leadership-centre/governance-driving-performance/a-case-study-of-apples-supply-chain

Peerless Media, LLC. (2013). Is Apple’s Supply Chain Really the No. 1? A Case Study. Retrieved from: https://www.supplychain247.com/article/is_apples_supply_chain_really_the_no._1_a_case_study

Wilson, J.M. (2012). Apple –The Global Supply Chain. Retrieved from: https://www.jackmwilson.net/Entrepreneurship/Cases/Case-Apple-Supplychain.pdf