Apples Current Expansion Strategy Apple is highly innovated company, providing high quality products and services including

the personal computer industry (MacBook Air, MacBook Pro), the consumer electronic industry (iPod, iPhone, iPad) and the software (iTune). The market for Apple is also very strong. For several years Apple's product strategy involved creating innovative products and services and also focused on global market development. With increase in technology, Apple has expanded into global markets, recording unprecedented levels of revenue and profit. In today's business environment, Apple has to stay ahead to be knowledgeable about changes in technology as well as continuing to find new ways to be competitive and meet customer demands. There are many different ways to access the global market through a number of different strategies. Apples utilization of multiple strategies simultaneously has allowed it to flourish despite the recovering global economy. Global Strategy Apple uses global strategies as their major strategies to expand into global market. 'Global Strategy' is a shortened term that covers three areas: global, multinational and international strategies. These three areas refer to those strategies designed to enable an organization to achieve its objective of international expansion. Apple focuses on global strategy, whereby their international activities are developed in an extent that they essentially treat the world as one market with very limited variations for each country or world region. For example, the iPhone 4S, iPod, MacBook that Apple exported are essentially the same products in every country. Besides, the Apple product was essentially following the same strategy everywhere in the world: in this case, the advertising billboard was in North America but it could have been anywhere. Apple utilizes several different strategies to expand its presence in global markets including foreign outsourcing and exporting. First strategy that Apple adopted is exporting (major mode of entry). The biggest breakthrough of Apple in exporting to the global market is the unveiling of the iPhone4. It was released in 88 countries (Kane and Rohwedder 2010). The shift shows how important overseas sales have become for Apple,

which struggled before the iPhone to become a global player. Chief Operating Officer Tim Cook said in the quarterly earnings call that iPhone sales were seeing strong tripledigit growth in Europe and Asia. Apple called it "the fastest international roll out" for iPhone (Kane and Rohwedder 2010). Tim Bajarin, an analyst at researcher Creative Strategies, estimates that about 55% of iPhone sales are now made outside of the U.S., from about 25% two years ago. The major foreign operations of Apple are conducted in the Americas, Europe, Japan, and Asia Pacific.

Figure 1: iPhone revenue growth in December 2009 compare with March 2010

Figure 2: The major foreign operations of Apple are conducted in the Americas, Europe, Japan, and Asia Pacific. Another global strategies that implemented by Apple is foreign outsourcing. This means contracting with foreign suppliers to produce products, usually at a fraction of the cost of domestic production. Apple Inc. depends on firms in China and Taiwan to produce the iPod, iPhone, iMac, MacBook Pros and most of the products that they offer.

The key reasons why Apple using exporting and foreign outsourcing as global strategies: 1. Emergence of new markets By expanding operations to an international scale, Apple can increase their total sales from essentially the same products. Besides, Apple gained global brand

recognition (the benefit that derives from having a brand that is recognized throughout the world) and global customer satisfaction (multinational customers who demand the same product, service and quality at various locations around the world).

2. Diversification Diversification enable Apple to avoids volatile swings in market prices and sales in any one market, allowing other markets to support these occurrences. For examples, on March 11, 2011, Japan experienced a severe earthquake followed by a tsunami. These geological events have caused significant damage in the region. The production and the sales of Apple have been affected; however, Apple global strategies allow them to diversify the losses in Japan because of the backup from the sales in other countries.

3. Gaining Economies of Scale The most significant benefit that Apple gained is the economics of scales. Apple endures cost savings by increasing the scale or size of its operations and size of the market. The may directly contribute to the price per unit of output falls, allowing for a reduction in price or an increase in profits. Besides, through international expansion, Apple obtains a better economy of scale by selling worldwide or establishing production opportunities in low cost labor localities. For examples, foreign outsourcing and importing provide production at cheaper costs which makes products such as the iPad sell for $499 instead of $14,970 (Gewirtz 2010).