Global Emerging Markets: A Case of Apple Inc

Global Emerging Market: A Case of Apple

ContentsIntroduction.................................................................................................................................................2

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Global Emerging Markets: A Case of Apple Inc

Globalization................................................................................................................................................2

APPLE INCORPORATION..............................................................................................................................3

1). Geographies of Economies.....................................................................................................................3

2). Global production network....................................................................................................................4

3). Global Market place...............................................................................................................................6

4). Regionalization and Localization............................................................................................................9

5). Competitors and competitive advantage:............................................................................................10

6). Geography of Labour............................................................................................................................11

7). Impact on the environment and sustainability.....................................................................................12

Conclusion.................................................................................................................................................13

Recommendations.....................................................................................................................................14

References.................................................................................................................................................14

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Global Emerging Markets: A Case of Apple Inc

Introduction

The term globalisation is so much developed in broader concept by different business scholars

and experts, that had explore the world as global village where the different things a have

linkage with one and other. The impacts of globalization are seen in various elements such as

economies, business people and cultural, etc. this impacts effects on positive and negative way

depending on situation and capacity of its reliability. Due to many issues, still big business

houses have considered globalization growing factor in their business, industries, countries and

world economy.

This report is a detail study of the concept of globalisation and its impacts on firms, industries,

countries, and world. The literature part had shown, to execute different views that are given by

business scholars and experts in favour and critics of globalisation. The Apple incorporation is

selected, to achieve the purpose of report, by reviewing the impacts of globalisation on apple

operation and logistics. The necessary conclusion is drawn and recommendation is mention in

order to improve the Apple’s future global image.

Globalization

According to business dictionary globalization terms means “Globalization implies the opening

of local and nationalistic perspectives to a broader outlook of an interconnected and

interdependent world with free transfer of capital, goods, and services across national frontiers.

However, it does not include unhindered movement of labor and, as suggested by some

economists, may hurt smaller or fragile economies if applied indiscriminately1.

Swedish journalist Thomas Larsson, in his book The Race to the Top: The Real Story of

Globalization, states that globalization: “is the process of world shrinkage, of distances getting

shorter, things moving closer. It pertains to the increasing ease with which somebody on one

side of the world can interact, to mutual benefit, with somebody on the other side of the world.”2

1 http://www.businessdictionary.com/definition/globalization.html#ixzz2SjhGwIoO

2 Larsson, Thomas. (2001). The Race to the Top: The Real Story of Globalization Washington, D.C.: Cato Institute. p. 9. ISBN 978-1930865150

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Global Emerging Markets: A Case of Apple Inc

APPLE INCORPORATION

The Apple Inc, is multinational American based company which is manufacturing, designing and

development of electronic items such as smart phones, music system, laptop and desktop and

other software application etc. There are no. Of registered software of apple which is official

includes in its hardware through its operating systems.

1). Geographies of Economies

The target market of apple is focusing in different world, and major of customer are business

clients, high rich class people and youth from age 16+ to 70 years. In the American markets the

share of Apple is very high up to like 37.9% as on second position the Asia pacific region comes

which is nearly 29.2%. The customer of Apple Company is highly developing in Asian and

European market. The more potential customer of apple is focused in countries like India and

china, Malaysia Thailand etc. In Japan the very less customer are focused which is nearly about

7.6% and in European markets is share is constant from last many years which is nearly 25.3%.

The store of apple is distributed worldwide as by august 2012 Apple was having nearly 395

stores and apple online selling was deal in 14 countries of world (Apple Inc., 2012).

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Global Emerging Markets: A Case of Apple Inc

Table:1 Apple stores

Country Stores Country Stores

United states 250 Spain 10

United kingdom 35 China 8

Canada 26 Japan 7

Australia 18 Switzerland 3

France 15 Hong Kong 3

Italy 12 Sweden 2

Germany 10 Netherland 1

Source: Apple Inc., 2012

3rd quarter 2012 Revenue by Geography

In America it was 26% high $12.81 billion, from $10.126 billion a year earlier.

In Europe it was 16% high: $8.24 billion, from $7.098 billion a year earlier.

In Japan it was 33% high: $2.01 billion, from $1.5 billion a year earlier.

In Asia Pacific it was 25% high: $7.89 billion, from $6.332 billion a year earlier3.

2). Global production network

First production of the all Apple products was in their country (America). All products, including

the Mac, iPad, iPod, iPhone, designed, developed and constructed a major center in the U.S. Of

the Apple produces unique, high-tech and competitive basis for differentiation, but also used by

competitors strategy of global production to minimize costs and increase profitability, Apple is

using the global production network to take advantage of the low cost of skilled labor and

production close to the market, reduce transportation costs, etc. In the initial period company

was only selling some of parts of Ipod in Hong-Kong. (linden et al, 2007). There was even some

products which is outsources by companies like Toshiba in Japan and Samsung in south Korea,

these products are different type of Flash memories and Hard drives. The apple even

outsources metal products to Taiwan in Foxconn, and respectively plastic products to Singapore 3 Apple Inc., 2012

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Global Emerging Markets: A Case of Apple Inc

(Brown, 1998, p.198). The apple assembling is done in china for all of its products and then

export to different markets in global with is home market in US (Kahney, 2008).

In current times Apple had designing companies developed in the U.S. and marketing

implementation California, but is mostly outsourced hardware products in some European

countries such as Germany and especially in Asian countries like Japan, Korea, Taiwan, China,

etc. This will undoubtedly reduce the cost and increase the company's profits, but there are

other issues, such as reducing the bilateral trade to create unemployment and budget deficits

and the countries to which it is produced.

Critical analysisIn this more discuss is shown in relevance to Iphone production and evaluation of same factors

which created issues in design and software of Iphone which was manufacture and assemble

outside US.

Table:2 Apple iPhone 3G’s Major Components and Cost Drivers Manufacturer

Manufacturer Component Cost

Toshiba (Japan) Flash Memory US$24.00

Display Module US$19.25

Touch Screen US$16.00

Samsung (Korea) Application Processor US$14.46

SDRAM-Mobile DDR US$8.50

Infineon (Germany) Baseband US$13.00

Camera Module US$9.55

RF Transceiver US$2.80

GPS Receiver US$2.25

Power IC RF Function US$1.25

Broadcom (US) Bluetooth/FM/WLAN US$5.95

Numonyx (US) Memory MCP US$3.65

Murata (Japan) FEM US$1.35

Dialog Semiconductor (Germany_ Power IC Application

Processor Function

US$1.30

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Global Emerging Markets: A Case of Apple Inc

Cirrus Logic (US) Audio Codec US$1.15

Rest of Bill of Materials US$48.00

Total Bill of Materials US$172.46

Manufacturing costs US$6.50

Grand Total US$178.96

Source: www.apple.com

From this Table it can be analysed that nine companies are producing different parts of iphone

and how it’s costing is reviewed.

The issue is why Apple assigns a society these components are manufactured in these

countries, the answer is the low wage rates in these countries ten times the installation cost of $

6.5 per unit in China, but the U.S. will be $ 65 in order to reduce costs and maximize profits, but

on the other hand, If Apple eventually all U.S. manufacturers, the unit price will cost $ 179 to $

238 selling price of $ 500, thus reducing the margin of 64% to 53%. But on the other hand,

outsourcing of people in America lose their jobs, so that producers in the United States, will

return to America's trade deficit of China loser because the iPhone only contributes over $ 3

billion dollars (21.3 million iPhones and manufactured exports to the U.S. 2011), the trade deficit

between the U.S. and China. So, a little compromise to reduce the profit margins are not the

only people in America get their jobs back, but can increase U.S. exports and reduce imports.

That, as part of government forces business situation to do, but the right U.S. companies to

maximize their profits, and corporate social responsibility should provide the time President

Obama met with Steve Jobs on this topic to create jobs for Americans.

3). Global Market place

Market position of the company is the market share hold by company in compared to the

competitor. Since Apple is a global company offering a wide range of products such as Apple's

various stocks in different markets can be classified markets geographically and product wise, I

will explain the parts of Apple's stock in different regions and countries, where its products such

as smart phones, computers, tablet, personal computers, laptops, music players plays vital role

in the market.

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Global Emerging Markets: A Case of Apple Inc

The apple gets 2nd position in its brand value after coca-cola, by Inter brand 13 th annual report.

The Apple had break off the record of Microsoft Company as in year 1999 it was having $618

billion but in 2012 apple had title of most valuable company by $622 billions. According to Heft

and Vance (2011) Apple is officially listed as number one company providing technology related

products. Apple is listed as most admired company consecutively last four years (Fisher, 2008:

Colvin, 2009: Fortune, 2010)

Tablet Market placeThe tablet market was also polished by Apple as it covers the 69% of total market where as

other competitors are also fallen in the small market segments.

Smart phone market placeThe series of Iphone is most valuable, as it hold advance technology, unique value and all other

feature as compared to other products. The demand of Iphone had been so much increased

that it initial selling at higher prices. The chart shows the comparison of Iphone with other smart

phones, as Apple is leading 29% of total smart phone market of the global though its Iphone

series.

The market share of apple is growing from 3rd quater of 2011 onwards till 3rd quarter of 2012 by

almost like 57%. The Samsung growth is 103% which is almost double as compared to apple.

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Global Emerging Markets: A Case of Apple Inc

In the market place Apple stand on second place by 30% where as Andriod stand on first

position by 50% market share from graph finding.

PC Market Share The apple PC market had seen a bit fall by 5% in the United States, as HP is on first position

and Lenovo on second and Dell on third respectively. The PC market for apple is bit difficulty as

in worldly market the Apple comes on 3rd position by maintaining stability. (Market research by

Gartner Pc)

MP3 Device MarketThe profit margin in Ipod is very high, apple is considered as leader in MP3 device markets, as it

covers 71% of total worldly share in the globe.

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Global Emerging Markets: A Case of Apple Inc

4). Regionalization and Localization

Regionalisation: The process of dividing the world economies or groups of countries by

geography, such as Europe, America, Australia, Asia, North America, South America, the

countries of Central Asia, etc.

Apple is targeting a different region of the world, the company exists naturally in certain areas of

stores, such as America, North America (Canada), Australia, Asia (China, Japan, Hong Kong),

Europe (United Kingdom Germany, France, Spain, Switzerland, Netherlands, Sweden), these

are the areas people including the Apple physically, but retailers two one a.m. online retailer

offers products in all regions of the world, Apple is the first to manufacture the products in the

state in America, but in recent years, companies outsource production to Asian countries, where

finally, after China is assembling products delivered in different regions of the world demand.

Different areas may be other strategies, such as marketing, finance, human resources, legal

aspects, best fit in, but eventually these strategies are created to fit the overall objectives of your

company. Also, tax rates, foreign currency rates, commodity prices can vary in different areas.

Localisation: means when the product is manufactured and distributed in local markets by

differentiating its features from its competitor to outreach customer

The Apple event, offering products design nationally and locally based on software and iTunes

in particular all languages. If Europe is considered as most will then countries such as the local

market, Apple products are the technology world like the same characteristics, but the purpose

of a variety of local markets, software, applications and games in the local language such as

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Global Emerging Markets: A Case of Apple Inc

offering Angol not know the market is this great that in many countries, such as Germany,

France, Spain and many other European countries, China, Japan, National Program that

language is no longer in English so most do not understand English. Apple invested in software

applications and games for a variety of developers in 40 languages. So in this way, Apple

focuses on local markets and successful global zones and explored the world.

5). Competitors and competitive advantage:

Apple had face a stiff competition in the market by have different competitors in different

services, such as competitors and the level of competition can vary in the market tablet, the

market for smart phones, the market of personal computers, operating systems and other

market software tools.

Apple is having a unique differentiation strategy specialist that can create products with high

content knowledge, which has more features than its competitors, a very strong brand image

and therefore charge high prices and high profits as compared to competitors.

According to hoover (2011) top three competitors of Apple Inc. in USA are fujitsu technology

solutions (holding) B.V., International Business Machines Corporation, Media net digital Inc.,

respectively. These competitors are following cost leadership strategy but Apple Inc. has

competitive edge of unique technology, high quality and brand image.

The main competitors of the tablet market, for Apple are Samsung, Amazon, Ansus, Barnes &

Noble, etc. The Apple dominates the tablet market with a market share of 69.9%, and high

technology, unique features and image brand is offering good value as compared with all other

competitors is having lower quality in some features, so the cost of basic strategies to make and

maintain market share well maintained by Apple.

Smartphone market, Apple's iPhone is the world's largest and has the most unique technology,

in the U.S. Apple's iPhone leading 29% share, while Samsung comes second with 24%, 15%

HTC, Motorola 10% the LG Rim 5% to 7%. Nevertheless, when we talk about global competition

to send Samsung smartphone is the first time a second 32%, the Apple 15.8%, 5% Htc4.8 Sony

%, etc. This classification of smartphones, speak participation We welcome including mobile

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Global Emerging Markets: A Case of Apple Inc

devices and even smaller, the rating is different, because Nokia is a global transfer large dignity

of shareholders of the device., but, as already mentioned, most of these competitors perform

basic strategy of cost, that despite the fact that most phones margin on sales are fewer

competitors.

In PC market again, computers of Apple Mac Book guides worldwide, as well as a key target

market diversification, unique quality, features and brand image of high prices and increased

profitability from our competitor, which compete with sales of HP products in the U.S. Dell also 2

Apple and third place., but also shows the Dell cost because of HP, then profit margins

compared to the MacBook example. 999 and HP 500 is a feature unique to Apple and the brand

gains more than double the margin compared with the two largest shareholders at the end of

most valuable company Apple, when talking about the global market share, Apple has not even

came ten times in relation to transport, but again, compared to the profit margins of Apple is the

most expensive.

Market of Music and play station instrument had globally leading market share of 71% in iPod, a

competitor SanDisk 11%, 4%, 2% Microsoft and Sony, Creative Labs, 2%, competitive

advantage, etc. unique insight iPod technology, quality and brand.

Market of Apple is buying the technology which evolves rapid change as it want to keep itself a

leader and win a competitive advantage, as well to make the best of products it uses marketing

mix such as product, price, place, promotion, strategies, performance and quality of products

and the reliability of the product of innovative design and updated software services.

6). Geography of Labour

Means the work of the geography of the division of labor with different abilities have different

costs, which are located in different geographical areas, as the genius of the willingness of

China, relatively cheap compared to Europe and America , India cheap labor and customers

have learned and services, etc., this should be explained by Apple Geography project working

where they belong, Apple has immediate employment more than 45,000 works in various

departments, the majority of these workers are employed in stores 395 countries, working

Fourteen of these stores are mostly in a state in which the stores, but not necessary, it can not

be a citizen of this country, but only lived for his work, but the main point is that the skills

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Global Emerging Markets: A Case of Apple Inc

required for the job, I want to be in the UK examples of people who live here are of different

nationalities working in the Apple store employees in India, China etc. live in the UK for work.

This concept defines the number of points, such as two-term or working in different

geographical areas that businesses need special skills to pass the state where the main office

of the company or a company outsources a function of geography between labor and some

skilled and relatively low cost.

The apple company, headquartered in California, with offices, laboratories, warehouses, etc.

professional developers around the world are attracting more and more technology companies

in California that Apple are highly qualified and competent professionals American university or

to the United Kingdom, Australia, Canada, Germany, Japan, China, etc., may also belong to

other countries around the world to immigrate to the United States Geography, a world-class

work.

On the other hand, Apple has assigned all of its production in some Asian countries such as

China, Korea, Taiwan, Singapore, where employees of different companies such as Samsung,

Toshiba, Foxconn, etc. Apple is working directly in the production of various products and parts

assembly and parts Apple products in Germany, regional and local headquarters of Apple in

Europe, America, Australia and Asia.

Design and development of a highly skilled geographies to attract the talented work of the world

labor is different, while low-skilled jobs such as construction, etc. are part of a strategy to

geographical skills of the labor force is to take advantage of lower labor costs.

7). Impact on the environment and sustainability

Apple is one of unique U.S. company based in the brand image in the world, has emerged as

one of the most admired companies in the United States and around the world for four

consecutive years (Fisher 2008 2009 Colvin, Fortune 2010 ;). As a result, the overall image and

social responsibility of the company Apple to manage much of the impact on the environment,

not only because it could be a legal issue, but a bad impact on the overall global picture of the

product, followed by Apple in compliance with all environmental regulations, but due to some

legal problems with subcontractors. Some of the problems are discussed

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Global Emerging Markets: A Case of Apple Inc

Like all other multinational outsourcing companies manufactured in Asia to take advantage of

their cheap labor, but also the type of interest, the Chinese government, petrochemical (Institute

of Public Affairs and Environment) reported 30 IT companies have been involved in

environmental issues such as the release of toxins, carbon dioxide emissions, more fraud and

breach of a body of work as a message of each company to resolve this viable option plan ,

every other member is an array, but at first did not agree that the supply chain PAL due to some

security reasons, but if it affects the overall view of all Apple, and he was decided that not only

all the details of the supply chain, but to set standards and to commit to a contract with the

supplier and they have to adapt to other standards to terminate the contract. The questions

were as a supplier of forty employees of small production units.

Publisher suicide may issue Foxconn factories and pollution is one of the "Wintek touch device"

It is also one of its factories in China charged workers $ 50 per month for shifts 15 hours a day.

According to the study, the CSP Apple is not directly involved in ethics, but the operation of

subcontractors involved, but still responsible for Apple to test these unethical procedures to

force them to comply with the standards that contrary to the ethical These methods are named

registered company, corporate identity and create problems (Sherman, 2010, 2011).

A dark after the publication of these questions are important steps and standards toxins

outsourcing unit, emissions of carbon dioxide and the rights of workers, etc. It is also possible

that these training programs have started outsourcing units.

Conclusion

The global financial uniform between countries for the elimination of trade barriers in world trade

is very fast and the economy benefit from the process of globalization, but against the people,

globalization and the growing point is not that all the farms to get the advantage, because there

is an equal amount of the assets that process, so that the negative impact on the economies of

people in these countries live their lives worse.

As with any procedure, some positive and some negative effects, does not mean that the

process is not an exercise, a useful process of globalization, then efforts should be made to

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Global Emerging Markets: A Case of Apple Inc

ensure that this process is where the entire economy can benefit maximum and minimal side

effects.

Recommendations

This study will examine the effects of globalization on the world, and especially discuss the

impact of Apple’s globalization. Based on this study, the following recommendations are made

by me in order to explore more benefits for company in future.

Apple is doing well in the global market, the only thing that the poor are subcontractors Apple

Outsourcing Association to perform some unethical practices. So you cannot expect Apple to

strictly follow the laws and ethical rules of society. I employ a clever surprise visit to outsourcing

of plants or check the rules. Outsourcing companies also signed a contract with the plants of the

company captured criminals to terminate the contract immediately, will be fine.

References

Bhagwati, J. (2004). In Defence of Globalization. Oxford, New York: Oxford University

Press.

Colvin, G. (March 16, 2009). The World’s Most Admired Companies 2009. Fortune

159(5) 76., Retrieved On July 31, 2011 From

http://money.cnn.com./gallaries/2008/fortune/0802/gallary.mostadmired_top20.fortune/

index.html

Porter, M.E. (1998) Competitive Advantage: Creating and Sustaining Superior

Performance, New York: Free Press

Sheila L.C. (2004) Globalization and Belonging: The politics of Identity in a Changing

World. Roman and Littlefield.

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