Apr 19, 2018 in Case Study Examples

Political factors

The sole-sources outsourcing partners in Europe, Asia and the USA perform supplying and manufacturing numerous important components. The Asian outsourcing partners are in charge of final assembling of almost all hardware goods of the company. There are certain obstacles for the transit to the destinations, manufacturing process or logistics. Such reasons of disruption may include anthropogenic and natural disasters, military actions, political issues, failures in operation of information technology systems, environmental problems, public health issues, labor, economic and business reasons (APPLE INC., 2012).

The global economy and international trading can be negatively affected with the consequences of terroristic acts, public health problems, geopolitical problems, and various business issues. Therefore, the operation of the company suffers from disruption and damage; the customers, logistic providers, suppliers, manufacturers, and channel partners are influenced with the negative effects of the above mentioned factors. Such natural disasters as earthquakes, fires or floods, along with the man-made catastrophes like power shortages, terroristic acts, public health problems, the accidents at power plants, various acts of hostility and different events that cannot be controlled by people are capable of interrupting the business operation of the company (APPLE INC., 2012).

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Economic Factors

The retail performance of Apple is seriously affected with the global recession. Provided that the global economic problems adversely affect the operation of suppliers of the company, the company can experience difficulties with obtaining the required components as a result of the follow-up effects. Thus, there are considerable risks of increase in price and shortage of power which influence the company. The plan of the company is to gain considerable decrease in the gross margin percentage in comparison with the rates in the year of 2012. Such future developments are expected to be achieved due to the introduction of innovative products and new goods that are offered at reduced or flat prices; however, the cost structures are higher and the value that the customers get is much greater. Besides, the costs, in particular the anticipated cost, are increased. The gross margin can also be negatively affected with the subsequent strengthening of the American dollar (APPLE INC., 2012).

Social factors

One of the requirements of the efficient business of the company is appliance and storage of PII (personally identifiable information) of the business partners, customers and employees. This contact information includes the names, telephone numbers, addresses, email, payment account data and the numbers of tax identification. Numerous companies in various spheres throughout the world experience attacks aimed at getting the access to the personal information which is not subject to disclosure. This risk for Apple is considerably higher doe to the enormous amount of the stored personal information and the high profile of the company (APPLE INC., 2012).

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Technological Factors

The expenditures of Apple get higher annually. The increase has been considerable since 2010; it was equal to 1.8 billion, 2.4 billion, and 3.4 billion US. dollars for 2010, 2011 and 2012 respectively. It is a significant increase for the highly competitive market of the present day (APPLE INC., 2012).

Environmental Factors

One of the spheres of action of the Company is selling the software and hardware products to the government customers and enterprises in all segments. All of the products offered by the company are in demand in the geographical segments due to the outstanding performance, high productivity, convenience and use of all modern information technologies. The tools of the Company enable the remote administration of devices as well as the development and safety of various customized applications. Another benefit is their compatibility with almost all services and business applications of the third parties (APPLE INC., 2012).

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Legal Factors

The international and domestic operation of the Company is regulated and affected with both the foreign laws and the regulations of the USA. All Company’s activities, in particular advertising, real estate operations, e-commerce activities, labor areas, digital services, billing, telecommunication, television, media, mobile communication, taxing, anti-corruption activities, ownership of intellectual property, safety, environmental issues, competitiveness, requirements to export and import, restrictions of cash repatriation, control of foreign exchange, health issues, privacy policy and consumer protection are subjected to the mentioned laws (APPLE INC., 2012).

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