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Apple Case Analysis - Term Paper Example

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Introduction and Key Issues The case study under review is regarding Apple Inc. and discusses about the history of Apple and also highlights the overall situation in industry in which Apple operates. Case study outlines as to how Apple has been successful in charging premium prices for its Personal Computers i.e…
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Apple Case Analysis
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Download file to see previous pages Though Apple may be thriving on its success in different segments specially its non-PC segment however, it is confronting with certain issues which can critically affect its operations in the future. Since late 1990s, the overall share of Apple in personal computers market is consistently below 5% which is far below than Apple’s traditional competitors. It seems that the buyers of Apple are too much focused on its non-PC products and consumers are willing to buy those products. The competitive products against Apple Mac are reasonably priced therefore consumers tend to prefer them over Mac due to price related variables. Further, technology is changing fast in the area where Apple is operating and historically firms tend to lose if they don’t keep up with the changes in technology. Whether Apple will be able to keep pace with this technology is something which everybody likes to explore. Situation Analysis External Analysis Apple’s competition is of international nature in its Mac segment of personal computers wherein it sells its PCs either through its own flagship stores, electronic retailors as well as through its website. The overall range of personal computers of Apple includes desktops, laptops as well as smaller mini notebooks. There can be different factors which may at play and can directly affects the way Apple operates in the industry. It is critical to note that Generation Y is becoming technology oriented with ownership of at least one PC is considered as essential because PC is now a days being used not only for entertainment purposes but for improving the productivity as well as to have access to information. What however, has changed over the period of time is the fact that consumers tend to favor those manufacturers which conserve the environment in their overall manufacturing process. The reusability of the material as well as its ability of not harming the environment is what is making the difference. It is also critical to note that the overall revenue of the industry is on rise since last decade except a slight dip during 2009. It may therefore can be safely assumed that industry is growing and there is relatively better potential for the existing players to expand with little bit of more innovation and creativity. A Porter Five Forces Analysis of Personal Computer Industry would suggest that buyers have higher bargaining power because of low switching cost. Suppliers also tend to have higher bargaining power due to technological sophistication as well as expertise they held in terms of providing the required hardware and software components to manufacture a personal computer. Providers such as Intel tend to have monopoly over certain critical components required to manufacture a PC and therefore tend to have more bargaining power. The overall threat of new substitutes is relatively low because industry is dominated by large players and the overall capital expenditure required is relatively high. Threats of substitutes can be significant especially in the wake of latest changes in the technology allowing smaller and compact tablet PCs to emerge as alternatives. Apple’s own IPAD is considered as a gadget which can actually kill personal computers therefore going forward there can be significant threats of substitutes. As a result of the technological developments and new market dynamics, the overall rivalry has intensified ...Download file to see next pages Read More
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