Apple Supply chain http://www.apple.com

Professor: 何正得Group 3: 楊光俊 , 阮氏明 , 楊明泰

OutlineBack ground of Apple computer IncApple supply chainSupply chain issueConclusion

Apple backgroundIndustry: Computer

hardware, Computer software,Consumer electronics, Digital distribution

Founded: April 1, 1976 (incorporated January 3, 1977 as Apple Computer Co., Inc.)

Headquarters: Apple Campus,1 Infinite Loop Cupertino, California, U.S.

Apple 1 personal computer kit

Apple backgroundNumber of locations : 359 retail

stores (as of December 2011)Area served: WorldwideKey people : Arthur Levinson

(Chairman) , Steve Job, Tim Cook (CEO)

Products Products: Mac, iPod, iPhone, iPad, Apple TV, Mac OS X, iLife, iWork, iOS

1974-2011

Apple products

Apple background

Services: Apple Store, Apple Store online, App Store, iTunes Store, iBooks, iCloud.

Revenue: US$: 108.249 billion (FY 2011)Operating income: US$ 33.790 billion (FY 2011)Profit: US$ 25.922 billion (FY 2011)Total assets: US$ 116.371 billion (FY 2011)Total equity: US$ 76.615 billion (FY 2011)Employees: 60,400 (2011)Subsidiaries : Braeburn Capital, FileMaker

Inc.

Apple supply chain

Suppliers and manufacturers

Apple products and components are manufactured by a wide variety of suppliers around the world (about 300 suppliers). The final assembly of most products occurs in China.

Suppliers and manufacturers

Samsung: The Singapore facility manufactures CPU and Video processing chips.Infineon: The Singapore facility manufactures Baseband Communications hardware.Primax Electronics: The Taiwan facility manufactures Digital Camera Modules.Hon Hai Precision Industry Co Ltd: The Taiwan facility manufactures internal circuitry.

1. Iphone

Supliers and manufactures2. Ipad

Entery Industrial: The Taiwan facility manufactures connectors.Cambridge Silicon: The Taiwan facility manufactures bluetooth chipsets.Umicron Technology: The Taiwan facility manufactures printed circuit boards.Catcher Technology: The Taiwan facility manufactures stainless metal casings.Broadcomm: The U.S. based facility builds touch screen controllers.Marvell: The U.S. based facility builds 802.11 specific parts.The Apple Shenzhen, China: facility assembles the hardware, holds inventory, and handles the pick, pack, and ship steps of the fulfillment process.South Korea-based LG Display Co., a supplier of screens used in iPads and iPhonesAccording to Taiwan Economic News, Taiwan-based Petgatron has outbid Foxconn for production of Apple's next-gen iPad

Supliers and manufactures

Location of Taiwan suppliers

Suppliers Responsibility at Apple Apple is committed to ensuring the

highest standards of social responsibility wherever its products are made. Therefore, Apple insist that its suppliers provide safe working conditions, treat workers with dignity and respect, and use environmentally responsible manufacturing processes.

Distribution

Retail Stores

Customer Customer

Apple

Customer

Third-PartyOnline Stores

Retail Store• On May 21, 2001 Apple first two retail locations welcomed over 7,700

people and sold a combined total of $599,000 of merchandise during their first two-day weekend. These two stores, located in Glendale, California and McLean, Virginia were the first of 25 stores the company opened across US in 2001.

• Apple opened 44 new retail stores during 2010, 28 of which were outside the US, ending the year with 317 stores open compare to 273 stores at the end of 2009.

• With an average of 288 stores and 254 stores opened during 2010 and 2009, respective, average revenue perstore increased to $34.1 million in 2010, compared to $26.2 million in 2009.

• The Retail segment represented 15% and 16% of the Apple’s total net sales in 2010 and 2009, respectively.

• As of September 24, 2011 Apple opened 40 new retail stores during 2011, 28 of which were outside the U.S. the Company had a total of 245 U.S. retail stores and 112 international retail stores.

During 2011, Apple had an average of 326 stores compared to an average of 288 stores during 2010. The average revenue per store increased 27% to $43.3 million in 2011 compared to $34.1 million in 2010.

Retail Store

Retail Store

APPLE STORE FIFTH AVENUE „CUBE

Retail Store

Retail turnover growth compared with overall turnover

Online stores

Third-Party• Apple’s strategy is to work side-by-side with its resellers,

increasing Apple presence and mindshare in their communities.• Third-party developers who independently develop applications

provide this additional functionality. Such developers are then able to distribute the applications approved by Apple through an online store maintained and controlled by Apple, which receives a 30 percent share of the revenue of such sales.

• There are over 3000 Apple authorized resellers locations in the US.

Third-Party: Salers Retailers Cataloguers Shop-in-shop

Apple at Best Buy

Inventory management Inventories are stated at the

lower of cost, computed using the first-in, first-out method, or market.

Regularly, with a new product Apple do not have inventory because high demand from customer.

Apple inventory management policy for iPad 2 deliveries: having its retail stores hold on to new shipments until the next day in an effort to ease the sales process for both customers and employees. Now, online order numbers have no relation to how many units have been sold.

iPad 2 line Wednesday at Apple's Fifth Avenue store.

Apple supply chain issueSuicides at Foxconn because poor factory conditions:

apple launched an international search for the most knowledgeable suicide prevention specialists—particularly those with experience in China and asked expertise to advise Apple and Foxconn.

Natural disaster such as Earthquake and Tsunami in Japan and Thailand flooding: Japan makes more than 40 percent of the world's electronic components. Earthquake impact supply chain and inventory management of Apple. A number of the Company’s suppliers are located in Thailand.

An unexpected rise in demand causes for inventory shortages: this is global supply chain problem. Apple outsources its manufacturing to China, which brings long supply chains that create long lead time for air freight. Sometimes, sources is limited. Many components that available from multiple sources are at times subject to industry-wide shortages and significant commodity pricing fluctuations.

ConclusionGartner annouces rankings of its 2011 supply

chain top 25: Apple help onto the No,1 position for the fourth

year in a row on the basis of continued killer financials and top of the line voting scores.

Apple annual report show that: The Company’s strategy also includes expanding

its distribution network to effectively reach more customers and provide them with a high-quality sales and post-sales support experience.

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