Apple has evolved and transformed over the years and become the world’s leading tech giant company. It is due to the visionary leadership that has allowed the brand to become a global supply chain leader. Today, we’ll discuss Apple supply chain strategy; and key elements of its SC strategy.
Some of the main steps in the SCM process of Apple are as follows;
- Material Sourcing – when the company buys material and components from suppliers
- Production & Manufacturing – the brand sends the bought supplies to the outsourced assembly plant in China
- Warehousing – the finished goods come back to the warehouse in the US and are then delivered to the customers through any service providers after receiving customer orders
- Distribution – the brand distributes the finished goods from the warehouse to the network carrier, wholesaler, and retail stores
- Return – some customers return their products to Apple for reuse and recycling
Some of the main products and services of tech giant company Apple are as follows;
- Apple Pay
- Apple Card
- Apple Watch
- Apple Store
The supply chain planning process of Apple comprises of following stages;
- Research and development for the new product design and latest technology
- Testing the concept and conducting market research for product testing
- Pre-launch to find potential issues and resolve them
- Launch and make a demand forecast
- Quarterly reviews to study the product life cycle, sales, and cost trends
Key Elements of Apple Supply Chain Strategy
Some of the key elements of Apple supply chain strategy are as follows;
Relationship With Suppliers
Apple focuses on developing strong relationships with suppliers and it offers the company great flexibility during the peak demand period. The company has a large production capacity and it helps the company to offer Apple’s products wherever customers want them to be.
The tech giant company has established a very strict protocol and standards for the supplier companies to follow it, and it goes by the name of Apple’s Supplier List. Roundabout 200 businesses and companies follow this list for their business procurement. When you require high quality from the suppliers, then it helps you to ensure the quality of the final product.
However, Apple is consistently working on innovation and creativity, and the company’s suppliers enjoy stability. If one product doesn’t succeed in the market, then suppliers are happy that they would receive the next order because the brand must be working on the new model.
Global Partners & SC Operations
Apple has impressive global SC operations. The tech giant brand employs companies and factories for the development of its products and devices in various countries like Japan, Taiwan, India, and China. For instance, Apple’s largest and oldest supplier in Taiwan is Foxconn. Foxconn has a network of more than 35 suppliers across the world. Its suppliers are producing components for Apple from countries like Vietnam, China, and Brazil.
Apple has been diversifying its supply chain network for the past many years, and China is one of the leading SC locations of the company. The top suppliers for Apple in China are Luxshare and Goertek and it collaborates with Murata in Japan.
Intel and Qualcomm are the top suppliers of Apple in the US and they offer chips and processors to the company. The brand has developed its chip-producing company by the name of Apple Silicon, and its relationship with Intel will be the topic of discussion in the future.
The CEO of Apple, Tim Cook has emphasized the efficiency of inventory and SC processes. Lean inventory management is highly significant to the growth of Tech Companies, and it gives preferences to the interests of customers.
However, the objective of Apple is to maintain little inventory, and it offers the company agility to launch innovative products. It is because the value of stock items decreases over, and having a limited SKU (stock-keeping unit) helps you to predict accurately.
Apple has taken various steps over the years to amplify the sustainability of supply chain processes. The brand has developed a closed-loop supply chain process, and it helps the company to develop renewable and recyclable products. That’s why we expect high-quality products from the tech giant brand.
Nowadays, Apple develops all of its products from renewable energy and 100% recyclable aluminum material. The company has invested significant resources in the development of clean energy technology.
Apple has announced its plans to achieve zero-carbon supply chain processes by the end of 2030. The tech giant has recently achieved the status of carbon neutral for global carbon emissions. However, the brand has explained to its manufacturing partners to support and follow the 13 gigawatts of renewable energy.
Conclusion: Apple Supply Chain Strategy
After an in-depth study of Apple supply chain strategy; we have realized that Apple is the world’s leading tech giant company with efficient SC processes. If you are learning about the SC strategy of Apple, then you should keep in mind the abovementioned strategic elements.
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