Apple Tows Matrix Essay

Custom Student Mr. Teacher ENG 1001-04 12 June 2016

Apple Tows Matrix

Pestel Analysis
Political Factors :
* War, terrorism, geopolitical uncertainties; issues beyond company’s ability to control.
* 52% of the company’s net sales in 2007 coming from countries outside America. * Manufacturing or logistics might be interrupted by political events in the manufacturing countries.

Economic Factors :

* Overall global economy outlook is not good.
* Inflation reduced consumer’s expenditure on luxuries.
* Economic crisis influencing Apple’s retail’s business.

Social Factors :
* A variety of regulations & law for health and Safety may adversely affect company’s financial condition.
* It is reported that the improper use of iPod may lead to hearing loss for users.
* Technological Factors :

* Fast technological changes.
* Frequent introduction of new products and the continual improvement in product performance.
Legal Factors:
* Employments laws nationally and internationally
* Tax laws in the U.S. and other countries
* Foreign trade laws
* Environmental Factors
* Apple products are made from a high grade titanium which is to reduce pollution during the making and be recyclable as well
* Products are also energy star qualified so they do not burn as much energy as traditional laptops do

Porter Five Forces
Threat of New Entrants-Low
* As the Apple leads the market with the different products like Pc, iPhone, iPad and iPod which are full of the features.
* As the Apple’s customer are loyal and they are ready to pay even the premium price to the company.
* Apple has no debts. New entrants will not affect them initially. * The leaders of the market already capture the major distributors like
* AT&T and Verizon in U.S which gain the 60% of the market. Same thing with Hp, Toshiba, etc.

Threat of Suppliers: Moderate
* The supplier of the products like, memory, chips, disks and drive are not the same.
* The products that are provided by the companies are standardized and had no substitute.
* The companies are going to use the standardize products to reduce the cost hence the suppliers products essential for the industry.
* As they are many suppliers in number, so the switching cost is low.
* The products that are provided by the companies are standardized and had no substitute.
* The industry is the growing industry and for the suppliers it is very profitable.

Bargaining Power of Buyers: Moderate
* The buyers are few and the customers are now moving towards the big stores like superstores, electronic retailers and web based retailers.
* The buyers are seemed more concern about the product features and availability.
* The products like PC’s and the mobiles phones are very individual and the brand is definitely critical for the success.
* As there are many suppliers of the products like the

* Apple, HP, Dell etc in the market and they all struggle for the distribution. The switching cost for buyers is low.

Competitive Rivalry: High
* The industry is fastest growing industry as the product lifecycle is not long.
* The business has a high cost as in the case the all the players fight for the market share by cutting their cost.
* The products are highly differentiated, because all are branded. *

* The brand is definitely is critical for the success that is why the
* Apple has a larger profit margins.
* The competitors in the industry are using the different strategies.
* The companies in the industry are in the market with the different strategies

Threat of Substitutes: Low
* There are many substitute of the technologies
* Switching brands sometimes is costly but sometimes is easy. It may depends on the how much the product is standardized with the demanded features.

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  • University/College: University of Chicago

  • Type of paper: Thesis/Dissertation Chapter

  • Date: 12 June 2016

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