United Arab Emirates University
College of Business and Economics
Spring 2023
Assignment 2
Apple Inc. – Case Study
SCML200_Supply Chain & Management Operations
Instructor: Aimane Dkhaili
Section 53
Group 6:
Zainab Almarzouqi 202011985
Noor Aldabal 202009952
Reem Alketbi 202221538
Salama Almazroui 202118693
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Table of Contents
Page Number
Title Page......................................................................................................................................... 1
Table of Contents............................................................................................................................. 2
Company Introduction
What is Apple?.................................................................................................................... 3
Competitive strategy............................................................................................................ 3
Company Operations
Design................................................................................................................................. 4
Manufacturing/ Production................................................................................................. 5
Supply Chain Management................................................................................................. 5
Marketing............................................................................................................................ 5
Sales.................................................................................................................................... 5
Company Supply Chain
Sourcing.............................................................................................................................. 6
Manufacturing.................................................................................................................... 6
Warehousing....................................................................................................................... 7
Distribution......................................................................................................................... 7
Return................................................................................................................................. 8
Supply Chain Capabilities and Practices
Logistics Network............................................................................................................... 8
Inventory Management....................................................................................................... 9
Demand Management......................................................................................................... 9
Supplier Management ........................................................................................................ 9
Sustainable Manufacturing................................................................................................ 10
Procurement...................................................................................................................... 10
Competitive Advantages & Benefits................................................................................. 10
Prospects of Supply Chain Strategy................................................................................. 11
References..................................................................................................................................... 12
Contribution.................................................................................................................................. 13
2
Company Introduction
a. What is Apple?
Apple Inc. is a computer and consumer electronics corporation based in the United States. It was
established on April 1st, 1976, by Stephen G. Wozniak and Steven P. Jobs, whose first computer
was built in the Jobs family garage. A market cap of nearly $2 trillion makes Apple one of the
biggest firms in the world. Apple products are well known for their attention to detail and attractive
design. Their systems outperform competitors' systems with comparable specs thanks to tight
hardware-software integration.
Apple Inc. (Apple) creates, produces, and sells wearable technology, smartphones, tablets, and
personal computers. In addition, the business provides digital material from third parties as well
as accessories, software, and related services. The iPhone , iPad, Mac, iPod, Apple Watch, and
Apple TV are among Apple's core product lines.
The customers who make up Apple's target market are middle-class and upper-class individuals
who have the means to pay more for goods that offer them an outstanding user experience. This
indicates that these consumers are more affluent and are prepared to spend more on items as
expensive as Apple's.
Apple successfully positioned its products to take the lead in the market. Personal computers,
graphical user interfaces (GUIs), mp3 players, smartphones, smartwatches, and tablets were not
created by them. Instead, they created some of the original versions of these items that were welldesigned, developed, and simple to use, which encouraged widespread market adoption.
b. Competitive Strategy
Apple's competitive strategy is founded on its strong brand reputation, an ecosystem of products
(hardware, software, and services), design and technical prowess, user experience-centric
approach, and solid financial standing. These elements have positioned Apple for future growth
and success and have helped the company become one of the world's most valuable and successful
businesses. The idea of order-winners and order-qualifiers can be used to explain the performance
dimensions of apples. A description of how Apple's internal operational capabilities can provide
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the company a competitive edge and help it succeed in the market. A qualifier aids a company's
entry into a certain market, whereas their order winner is a quality that distinguishes their product
from competing goods in the same market.

Order qualifiers: Price and quality are two criteria used by Apple. The program must
function without a hitch and be simple to use in order to fulfill market criteria. Due to the
company's products' high price range, they cannot compete on price, hence their prices are
in line with market norms.

Order winners: Apple's three key winners were invention, opportunity, and execution.
Apple often updates its goods over one to one and a half years, demonstrating the efficiency
and speed with which they develop new items. This is especially true for iMacs and iPods,
which come in a variety of sizes and shapes but are constantly updated and enhanced
whenever a new generation is introduced. With the help of the service iTunes, you could
easily access music no matter where you were and buy both individual songs and entire
albums. Since no other company at the time offered comparable services, it aided in gaining
business. Their excellent customer service and relationships with customers are Apple's
biggest sales drivers for all of their products. Opening more than 400 locations worldwide
that provide training, guidance, information, and repair services directly and rapidly makes
it stand out because no rival has effectively done something like that.
Company Operations
The core processes of Apple are those responsible for creating value for customers and generating
revenue for the organization. Apple stands out from other companies thanks to its distinctive
business model. The main core operations at Apple include the following:
1. Design: The simplicity, beauty, and functionality of Apple's design process are wellknown. The design principle of the company is to concentrate on the user experience and
produce products that are simple to use. To make sure that the design of the product meets
the needs of the user and the market, Apple's design team collaborates closely with the
engineering and marketing teams.
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2. Manufacturing/ Production: Apple uses a highly effective manufacturing process that
enables it to create high-quality products at a reasonable price. To accomplish this, the
business combines internal manufacturing with outsourcing. The product is made, tested,
and evaluated, after which the design team makes changes, and a new version of the
product is developed. Apple’s attention to detail is also what sets them apart, as they test
how their packaging opens in order to provide the best consumer experience.
3. Supply Chain Management: With parts sourced from all over the globe, Apple has one
of the most intricate supply chains. To ensure that it can satisfy customer demand for its
products, the company closely manages its supply chain. Demand forecasting, inventory
management, and close supplier collaboration are all part of Apple's supply chain
management process.
4. Marketing: In order to convince potential clients to buy the goods, marketing entails
selecting the specific channels via which a product or service will be launched in a niche
market. Advertising goods and services to consumers is simply one aspect of marketing.
Apple is particularly good at this: it increases customer awareness of the product, has an
effective marketing strategy, and focuses on generating demand for the product across
multiple market sectors. Products like the iPod, iPhone, and iPad have all revolutionized
their respective markets, and their success is directly connected to their marketing
strategies. By focusing on creating products for its target market and loyal customers who
honestly believe utilizing the company's products improves their quality of life, Apple goes
above and beyond what other businesses do. That explains why Apple has remained a top
marketer for more than ten years, consistently delivering results.
5. Sales: Apple sells its goods via a range of channels, including stores, online sites, and
through third-party businesses. The retail locations of Apple are created to offer a
distinctive shopping experience that is consistent with their brand. Building lasting
relationships with customers and providing them with a personalized experience are the
main goals of Apple's sales process.
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Company Supply Chain
Cupertino, California is the home of the Apple corporation. Although they use different suppliers
and employ different evaluation techniques, Apple's supply chain is comparable to the others. The
Supply Chain Map is the most effective way to provide a comprehensive framework from the
outset to the conclusion of the activity. Apple's supply chain map identifies the following five key
processes:
1.
Sourcing: Apple sources its raw materials from many places and works with several segment
suppliers. There are only a few companies that provide them with components, and they are
dispersed around the globe. When Apple's shareholders sell their shares, there is little share
turnover, in contrast to its rivals. It is possible to save the least amount of inventory as needed.
This is because bearings and competitors often affect prices. Mobile phone manufacturers are
unable to keep big inventories of their products since unforeseen measurements from rivals or
other developments may result in significant adjustments and abruptly lower the value of their
products. The United States, China, India, Europe, and other Asian nations are the nations
from where Apple sources its materials and components.
2.
Manufacturing: Due to technical limitations, the iPhone cannot be produced in the US.
Particularly, not enough people are available to assemble Apple products. Manufacturing is
more affordable in China than in other countries. At the Chinese factory where Apple products
are put together, about 230,000 people work. In the US, there are 83 metropolitan areas with
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populations similar to those currently employed in industrial facilities. This shows that there
are not enough potential workers in the US to suit Apple's needs. Production in America is
more expensive in terms of installation and outsourcing. This is due to higher employee costs.
Because the business needs to make money, the costs associated with doing so can inevitably
be passed along to customers as the cost of goods rises. This implies that products developed
by Apple cost more in less challenging circumstances.
3.
Warehousing: When customers purchase items from the Apple Online Store, the assembler
ships the items straight to the customers using UPS or FedEx. Apple will keep products in Elk
Woods, California, which is home to the main warehouse and call centers and will start
shipping goods from there for additional distribution channels like retail stores, direct stores,
and various merchants.
4.
Distribution: Apple sells its products both directly and indirectly. In order to expand its
market reach and boost product availability, it offers products through a variety of channels.
Apple's channels of distribution include:

Direct retail: The business runs its own Apple Stores. These are physical
establishments found in significant geographic marketplaces. They function as a onestop shop for buying goods as well as for getting value-added and post-sale services
like warranties and repairs. Instead of serving as straightforward outlets for commerce,
these stores serve as showrooms that enrich the customer experience.

Online stores: In addition to maintaining a formal website, Apple also has an online
store. It features an integrated electronic commerce feature that enables users to buy
the goods they want with the option of product customization. Typically, products
purchased from its website are shipped directly from a local warehouse or the
manufacturing facility itself.

Authorized Retailer: Apple products are also sold by third-party merchants referred to
as authorized retailers, who follow the Apple Store showroom model. These retail
establishments provide a one-stop shop for buying goods and receiving value-added
and post-sale services. Sales representatives receive training to provide technical
know-how for a simple troubleshooting or product information. Sales representatives
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receive training to provide product knowledge or technical skills for simple problemsolving. Some examples of authorized and dependable retail partners of Apple in the
UAE that offer a wide selection of goods are Emax and iSTYLE.

Network Carriers: In order to sell several of its consumer electronics products, like
iPhones, iPads, and Apple Watch, Apple also collaborates with network service
providers or network carriers (like Du and Etisalat). Additionally, several carriers
provide Mac devices. With their network service plans, these providers include
flexible payment arrangements. Some even provide financial support for Apple
products as part of their marketing strategies.

Other Third Parties: The business also sells its goods to wholesalers, who then resell
them to other, more modest shops. Additionally, it distributes via various independent
retailers, including big-box stores, branded stores, and electronic shops. Due to their
connection to the wholesale market, these shops frequently get quick access to newly
introduced products.
5.
Return: When a product reaches the end of its useful life, customers can return it to the
committed reusing centers or Apple Stores in their area. Apple tries to adhere to the lean
manufacturing principle. Apple employs parts from earlier devices in this approach, which
lowers the cost of new products, as well as pollution and greenhouse gas emissions.
Supply Chain Capabilities and Practices
Logistics Network
Apple's logistics go much beyond just getting the finished product from its manufacturing
facility to the customer. Each iPhone requires particular parts and components, which must
be purchased from the location of their manufacturer before assembly can start. Apple must
collaborate with close to 200 vendors to ensure that Chinese assembly can start exactly on
schedule. Since millions of gadgets will be sold throughout the launch weekend, sales,
marketing, and finance must work together to ensure that there are enough created. As a
whole, Apple's logistics are a key and complex process that requires the coordination and
administration of numerous tasks, such as purchasing, shipping, warehousing, and
distribution, to make sure that goods are delivered to customers quickly and efficiently.
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Inventory Management
Apple's CEO, Tim Cook, is renowned for his attention to inventory and the whole supply
chain. Since maintaining a lean, efficient inventory management system is particularly
crucial in the technology sector, where new products can essentially kill consumer interest
in older ones. Apple uses a Just-in-Time (JIT) inventory method to cut costs and speed
delivery. Apple maintains as little inventory as possible to provide them the flexibility they
need in the event that a rival releases a ground-breaking new product, depreciating the
value of whatever things they might have on hand. Furthermore, forecasting can be done
with greater accuracy when there are fewer SKUs (stock-keeping units) to keep track of.
Additionally, uses SCM and ERP systems to track and manage its inventory levels. With
fewer suppliers and warehouses, Cook has gained a significant competitive advantage
because of its inventory-tracking systems.
Demand Management
Apple is not required to precisely forecast consumer demand for a new product. As long
as Apple underestimates demand for a hot new product, it will have committed followers
waiting for the new products and prepared to wait. Customers must stand in line for hours
before stores even open to acquire a new item because of the anticipated backlog. This
fuels marketing hysteria.
Supplier Management
Apple is dedicated to upholding the highest standards of social responsibility,
environmental stewardship, and moral behavior. Wherever they produce goods or offer
services for Apple, the company's suppliers are obligated to ensure a safe working
environment, treat employees with respect and dignity, behave fairly and ethically, and
adopt environmentally friendly methods. Apple requires its suppliers to abide by the
guidelines outlined in the Apple Supplier Code of Conduct in order to fully comply with
all applicable laws and regulations. This Code advances social and environmental
responsibility by using widely accepted norms, going beyond merely following the law.
This Code describes Apple's standards for Supplier behavior regarding ethics, management
practices, environmental preservation, and labor and human rights. Apple carefully
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collaborates with a wide range of partners, including producers, suppliers, and logistics
companies, to make sure they can keep the company's high standards for dependability and
quality. Additionally, Apple collaborates with its suppliers to make sure they can adhere to
its manufacturing schedules and deadlines.
Sustainable Manufacturing
Apple has introduced several initiatives to improve the sustainability of manufacturing
processes over the years. For example, Apple stated that it would create a closed-loop
supply chain in 2020. This indicated that someday all products would be created using the
same high standards of quality we have come to expect from the company, but exclusively
using recyclable or renewable resources. Most of its most recent products, including the
MacBook Air, are made completely of recycled aluminum, and all of its existing facilities
are powered by renewable energy. Additionally, the company has made large investments
in several clean energy technologies, including solar and wind. Vendors from all over the
world can search for renewable sources through its online Clean Energy Portal.
Procurement
When Apple requests a price quote from a manufacturer, the company expects a thorough
explanation of how the manufacturer arrived at the offer, together with estimates for labor
and material costs and predicted profit. This is similar to the practices of other large
corporations with significant purchasing power. For quality problems and warranty claims,
manufacturers may face fines. Apple's size is growing to the point that, despite having to
pay more for several customized components, its cost structure is beginning to mirror that
of some of its competitors who solely use generic components.
Competitive Advantages & Benefits
Costs are reduced via Apple's supply chain management. By simplifying the supply chain
and reducing production and distribution expenses, Apple can provide competitive prices.
Apple's supply chain approach enables them to respond quickly to market developments,
such as the introduction of new products and consumer demand. Apple maintains its
competitiveness by quickly adjusting to market developments. Apple manages its supply
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chain to guarantee product quality. Apple controls its supply chain to guarantee top-notch
goods. Long-term business success depends on satisfied and loyal customers. Last but not
least, Apple's supply chain management strategy guarantees top-notch customer service.
Apple controls its supply chain to make purchases easily and affordably. This guarantees
customer pleasure and continued Apple sales.
Prospects of Supply Chain Strategy
One of the most prosperous tech businesses in the world is Apple Inc., and a significant
factor in this success is supply chain management. The supply chain of the company must
adapt as it expands to meet its needs. Apple's supply chain management will need to
prioritize efficiency, sustainability, and customer service in the future.
Sustainability: Apple is embracing sustainability in the technology industry. The company
lowers packaging waste and employs renewable energy. Apple must continue to make
investments in clean energy, reduce emissions, and use eco-friendly materials in its
products.
Efficiency: Efficiency is a top priority in Apple's supply chain strategy. The supply chain
must efficiently satisfy consumer demand. To make its processes more efficient, Apple
must use automation and AI. The company will reduce costs while enhancing service.
Customer Service: To succeed, Apple relies heavily on its customers. The business must
fulfill orders accurately and promptly. To do this, Apple requires chatbots and automated
customer assistance services. Both the customer experience and costs are improved.
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References

https://www.techtarget.com/whatis/definition/Apple

https://www.britannica.com/summary/Apple-Inc

https://www.simplilearn.com/tutorials/marketing-case-studies-tutorial/apple-marketingstrategy

https://valueinvestorscentral.com/apples-competitive-advantage/

https://www.grin.com/document/417198

https://www.globaldata.com/company-profile/apple-inc/

https://www.interaction-design.org/literature/article/apple-s-product-developmentprocess-inside-the-world-s-greatest-design-organization

https://www.designorate.com/how-does-apples-design-process-work/

https://startuptalky.com/apples-marketing-strategy/

https://edubirdie.com/examples/advantages-and-disadvantages-of-apple-supply-chain/

https://www.konsyse.com/articles/distribution-strategy-of-apple/

https://www.thomasnet.com/insights/apple-supply-chain/

https://www.vacanciesinlogistics.com/blog/apple-iphone-logistics

https://www.supplychaintoday.com/logistics-of-apple-explained/

https://dfreight.org/blog/an-insight-into-apples-supply-chain-strategy/

https://respect.international/wp-content/uploads/2017/11/Apple-Supplier-Code-ofConduct.pdf
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Contribution
Student 1: Salama Almazroui 202118693
Date submitted: Monday, 1 / 5 / 2023
1. Company Introduction
 Introduce your chosen company (background on them, what do they produce or
provide, their target customers)
 Brief about their competitive strategy? what is their competitive advantage (dimensions
of performance in Chapter 2)
Student 2: Reem Alketbi 202221538
Date submitted: Monday, 17 / 4 / 2023
2. Company Operations
 Explain the Core Operations in the company, the core processes in your company’s
Operations
Student 3: Noor Aldabal 202009952
Date submitted: Thursday, 27 / 4 / 2023
3. Company Supply Chain
 Discuss how their Supply Chain works: who are their suppliers, where are they located,
how do they get their materials from their suppliers, where do they carry out their
operations, how do they deliver the product or service to the customer, what are their
distribution channels?
 Explain your chosen company’s inventory, where do they store their inventory? Do
they outsource their D.C and distribution operations to a 3PL (like Aramex or DHL)?
Student 4: Zainab Almarzouqi 202011985
Date submitted: Thursday, 2 / 5 / 2023
4. Supply Chain Capabilities & Practices
 Discuss their Supply Chain Capabilities & Practices, this could be their Logistics
network, Inventory Management practices, distribution system (centralized vs local),
Supplier Management (long term suppliers, supplier collaboration), manufacturing,
Outsourcing, procurement, demand management, customer service, Retail
stores…etc.
 What advantage does your company gain against the Competition by having these
Supply Chain Capabilities & Practices? (how the capabilities help the company in
creating a competitive advantage or solve problems)
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