[TYPE THE COMPANY NAME]

SCM ASSIGNMENT
NAME :DEEP SHAH

ROLL NO:350226

DIVISION: FINANCE C
 INTRODUCTION
The product I have chosen is apple computers i.e. (I mac)

The product belongs to the IT industry.

Apple Inc. is an American multinational technology company headquartered

in Cupertino, California, that designs, develops, and sells consumer
electronics, computer software, and online services. The
company's hardware products include the iPhone smartphone, the iPad tablet
computer, the Mac personal computer, the iPod portable media player, the Apple
Watch smartwatch, the Apple TV digital media player, and the HomePod smart
speaker. Apple's software includes the macOS and iOS operating systems,
the iTunes media player, the Safari web browser, and
the iLife and iWork creativity and productivity suites, as well as professional
applications like Final Cut Pro, Logic Pro, and Xcode. Its online services include
the iTunes Store, the iOS App Store and Mac App Store, Apple Music, and iCloud.

Value proposition:

A company’s value proposition is as important as a person’s soul. A company

without a clear and singular is like an individual without energy and power. Value
proposition is a company’s strategy that attracts customers to purchase its
products. The value proposition convinces customers that company’s products
and service are the best among all the rivals so that they will buy the products.
Apple is a company which has such a great brand and a great value proposition.
When Iphone 4 came out in 2010, it suddenly occupies the smart phone market.
Several months later, people could see Iphone everywhere. Why are Apple’s
products so popular that people decide to purchase their phones rather than
other brands in that time? Let’s have a detailed look at its value proposition.

First, the Apple company was the first producer who created a powerful and
convenient smart phone with touch screens. Generally, consumers tended to
think the first company that entered the market would produce the best products
in that realm. Plus, the design and ISO operation system of the new Iphone 4 was
so unique that made it stand out from its competitors. Moreover, the Apple’s
Apps were connected to a lot of businesses such as Air Canada, Nike, Facebook;
these relationships certainly render the Apple company a much stronger one in
the world. Therefore, more and more people became aware of the company and
the strength of it products. That was why the Iphone 4 made such an unbelievable
purchase storm in 2010 when it first came out.

Strategies followed by apple to create value:

Apple only does a few things. Apple does not try to be all things to all people. If
you are outside their target customer they don’t really care whether you do
business with them. They understand that focus in a few areas allows all of their
employees to keep their eye on the ball. Apple knows that excellence comes
from doing a few things and doing them extraordinarily well.

Concentrating on a few things allows you to become world class at those

things. If you try to develop a product that everyone will want you will develop
one that no one really cares about. Apple is the most successful niche company I
know. They have learned that having people say no thanks is part of their
success.

Designers run the show. The designers at Apple tell the engineers what’s going to
happen. Designers are the dreamers and the engineers have to make the dreams
reality. When engineers run the show great things don’t happen. Apple has
proven that when designers make the decisions great things happen.

Designers by their nature are dreamers. They get to think about what happens in
a perfect world. A question you might ask is if the dreamers are behind product
development in your company? If not, you might want to think about making
that change.

Apple keeps people at jobs they’re best at. We too often hear about the great
salesperson that is promoted to sales manager and falls on their face. Apple
doesn’t look for a promotion path for their people where those people won’t be
great. Instead they look for people who will be great in a job and allow them the
freedom to get even better at what they do.

Research has shown that it takes about 10,000 hours to become world class at
something. We also know that if we do purposeful practice around our unique
ability we continue getting better throughout our life. Apple understands this and
allows their people to continue to get better at what makes them special.

Apple is all about the customer experience. Whether you go to an Apple Store or
use an Apple product you will likely either love it or hate it. Apple knows that
their customers love the experience of doing business with Apple. They don’t
really care about those who don’t love the experience. Those people are not
going to be raving fans.

We need to understand that we can’t be all things to all people. Apple has
figured that out and only concentrates on making a wonderful customer
experience for those who appreciate what they do.

VALUE CHAIN ANALYSIS:

Value chain analysis can be a useful tool as a firm seeks to achieve competitive
advantage. A value chain is a way of conceptualizing the activities that are needed
in order to provide a product or service to a customer. It depicts the way a
product gains value (and costs) as it moves along the path of design, production,
marketing, delivery, and service to the customer.

It includes the primary activities of: inbound logistics, operations, outbound

logistics, marketing and sales and service. It also includes the support activities of:
infrastructure of the firm, human resource management, technology
development and procurement.

Value chain analysis is a strategy tool used to analyse internal firm activities. Its
goal is to recognize, which activities are the most valuable (i.e. are the source of
cost or differentiation advantage) to the firm and which ones could be improved
to provide competitive advantage.
There are two different approaches on how to perform the analysis,
which depend on what type of competitive advantage a company wants
to create (cost leadership or product differentiation advantage).
So, the company can choose any one of the two approaches based on its
objectives and target customers. If a company can create an advantage in
any of its activities through a value chain analysis, itcaptures a
competitive advantage and increases its overall profit.
SWOT Analysis:

APPLE VALUE CHAIN ANALYSIS

Apple Inbound logistics

Apple works with hundreds of suppliers around the globe and maintains a highly
sophisticated supply-chain management as illustrated in Figure 2 below. Apple’s
purchase commitments typically cover its requirements for periods up to 150
days. CEO Tim Cook is known for his strategy of getting suppliers to compete
with each-other and he has reduced the numbers of suppliers considerably after
becoming CEO in 2011.
 Figure 2. Apple operations roadmap
The main sources of value in Apple inbound logistics relate to the economies of
scale due to the massive scope and scale of business operations as discussed
below and the development of strategic relationships with suppliers. Moreover,
Apple Inc. exercises an immense bargaining power in dealing with its suppliers
and as a result, the company is able to secure cost advantage in the purchase of
resources.

Apple Operations
Apple operations are divided into the following reportable operating segments:
1. Americas: North and South America
2. Europe: European countries, India, Middle East and Africa.
3. Greater China: China, Hong Kong and Taiwan
4. Japan
5. Rest of Asian Pacific: Australia and other Asian countries
Apple operations are conducted by 123,000 full-time equivalent employees as of
September 2017. Outsourcing of manufacturing to locations with lower costs of
resources is the main source of value for Apple operations. Specifically, only some
models of Mac computers are manufactured in USA and Ireland and the majority
of Apple products are outsourced to manufacturing units based in Asia.
 Apple Outbound Logistics
Apple outbound logistics involves warehousing and distribution of ready iPhones,
iPads, Mac computers and other products produced by the company. E-
commerce sales are rightly acknowledged by the company as a massive source of
value in terms of inbound logistics, because e-commerce is more cost effective
compared to sales via Apple Store.
Due to the efforts of the company in this direction, Apple Inc. has become the
third largest retailer in the US in terms of size of e-commerce business, only
behind Amazon.com and Wal-Mart Stores Inc. Specifically, Apple Inc. has e-
commerce sales of USD 12 billion and this figure accounts to about 5.1 per cent of
company’s total sales.
Moreover, a greater level of market penetration into Asia in general and China in
particular can be specified as an additional source of value for Apple Inc. from
outbound logistics point of view. This is because selling in this particular
geographical market would not involve massive outbound logistics expenses and
this cost advantage can be passed to customers to increase the overall appeal of
offers.

Apple Marketing and Sales

Apple sells its products through the following seven sales channels:
1. Apple retail stores
2. Apple online store
3. Direct sales force
4. Third-party cellular network carriers
5. Wholesalers
6. Retailers
7. Value-added resellers
During 2017, the Company’s domestic and international net sales accounted for
37% and 63%, respectively, of total net sales Moreover, during the same period,
the company’s net sales through its direct and indirect distribution channels
accounted for 28% and 72% of total net sales respectively. Apple has been
increasing its focus on enterprise sales during the past few years and CEO Tim
Cook announced an extensive reliance on Channel Partners to further increase
the volume of enterprise sales. The company is taking concrete steps in this
direction. For example, “Apple and Cisco announced a partnership in August
2015 to optimize Cisco networks for Apple iOS-based devices and apps while also
working to create better business integration between Cisco voice and video
environments and the iPhone.”
Apple Service
Apple is famous for exceptional quality of customer services during all three
stages: pre-purchase, during the purchase and post-purchase. The company
maintains Apple experience centres in major cities around the globe where
anyone can use its products to become convinced about the quality. Apple sales
assistants are usually trained and polite young males and females who are
technically savvy and happy to demonstrate product features and capabilities.
Post-purchase customer service is also impressive with unique iPhone trade-in
programs that allow iPhone users to upgrade their phone to newer models with
additional payment.