- Write a 900 word paper on your analysis of that company (Due 1 Dec)
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The company to be analyzed is Apple Inc. It was founded by Steve Jobs and Steve Wozniak in 1976.
Apple Inc. is a recognized innovator in the information industry and leader in multimedia technologies, creates powerful solutions based on easy-to-use personal computers, servers, peripherals, software, personal digital assistants and Internet content. Headquartered in Cupertino, California, Apple develops, manufactures, licenses and markets solutions, products, technologies and services for business, education, consumer, entertainment, scientific and engineering and government customers in more than 140 countries.
The main products are Mac, iPod, iPhone, iPad and iTunes. It is a publicly held company, the stock symbol is AAPL. Steve Jobs is the Chief Executive Officer, Peter Oppenheimer is the Senior Vice President and Chief Financial Officer, and Tim Cook is the Chief Operating Officer.
The Company competes in highly competitive global markets characterized by aggressive price cutting, with resulting downward pressure on gross margins, frequent introduction of new products, short product life cycles, evolving industry standards, continual improvement in product price/performance characteristics, rapid adoption of technological and product advancements by competitors, and price sensitivity on the part of consumers.
SWOT Analysis:
Strengths
· Apple has been amongst the well reputed brands in the industry of information technology. It also stood up to its name by introducing new products such as iPod, iPad and laptops in the market to impress customers with its innovation, portable and attractive designs.
· Apple computers are well know for its quality hardware and softwares.
· iTunes Music Store is an excellent source of revenue, especially with the iPod and the accessibility on Windows platform.
· Apple Computer are expert in Developing own software and hardware.
· Apple’s niche audience provides the company with some lagging from the direct price competition.
· Giving a face-lift to desktop and notebook lines.
· Web technology can be used to improve product awareness and sales.
· Low debt—more maneuverable.
· Apple Computers have good brand loyalty.
· Partnership with Intel Computers in 2006 – Present.
· Strong Research & Development Department.
Weaknesses
- Most visible weakness of Apple is high prices of products. Apple has to do some work to reduce the prices.
- Apple operating system support limited software which push the people to use Microsoft Windows to run different applications.
- Limited hardware upgrading option in Apple laptops.
- Weak relationship with Intel and Microsoft.
- Weak presence in business arena.
- The product life cycle of Apple products are very small for that reasons revenues are more depend on launch of new products and services.
- Weak presence in markets other than education and publishing.
- Slow turn around on high demand products.
- Apples market share is far behind from major competitor Microsoft.
- In past the relationship between Steve jobs and employee were not good which result in reputation loss.
- There is pressure on Apple to increase the price of its music download file, from the music industry itself. Many of these companies make more money from iTunes than from their original CD sales. Apple has sold hundreds of millions songs through its iTunes music store. It accounts for 82% of all legally downloaded music in the US. But if it gives in to the music producers, it may be perceived as a commercial weakness.
Opportunities
· Increase the support of applications.
· Allows easy hardware and software upgrades in laptops.
· Reduce the prices to increase market share.
· Increase in worms and viruses on PCs so the antivirus solution can be developed by Apple
· Large population (Gen X&Y) which are extremely individualistic and name brand conscious.
The ties of apple other companies are weak, Apple can develop good relationship for joint ventures
The ties of apple other companies are weak, Apple can develop good relationship for joint ventures
· Downloadable music and MP3 players are highly marketable.
· The online sales of computer are increasing with rapid speed.
· The laptop market growth is high; Apple Computers should focus to develop new models to cater the need of customers.
· Podcasts are downloadable radio shows that can be downloaded from the internet, and then played back on iPods and other MP3 devices at the convenience of the listener. The listener can subscribe to Podcasts for free, and ultimately revenue could be generated from paid for subscription or through revenue generated from sales of other downloads.
Threats
· Companies not seeing Apple as compatible with their software.
· Apple facing strong competition from Dell, HP, Sony and Toshiba in laptop segment.
· Downloading free music from other online source without paying cost is common it may impact the iTunes sales.
· Apple software, Cell phone and hardware are expensive as compared to other competitors such as Dell.
· The long lasting recession may impact the sales of the company due to higher prices of the products and services
· Microsoft launched Microsoft Vista, Windows 7 which is gaining market share.
· The switching in technology is very fast.
· Being successful attracts competition, and Apple works very hard on research and development and marketing in order to retain its competitive position.
From Apple’s recent (October 18, 2010) Fourth Quarter Results, the company posted record revenue of $20.34 billion and net quarterly profit of $4.31 billion, or $4.64 per diluted share. International sales accounted for 57% of the quarter’s revenue.
With the performance and strength of the business, it generated almost $5.6 billion cash flow from operations during the quarter.
References: apple.com, mba-turorials.com, oppapers.com, alacra.com, scripting.com,marketingteacher.com.
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