Essay on Porters 5 Force Analysis of Apple Inc

1763 Words 8 Pages
Apple Inc. specialises in development, design and marketing of computers, portable-digital music players and other didgital devices including iPad’s and mobile devices (IPhone). Apple Inc. are also involved in selling multiple supporting software, digital content, third party applications, networking software and services. Apple Inc. predominantly operate from their U.S headquarters in Cupertino, California and involves 72,800 employees (Forbes, 2013). Revenue for APPL in 2013 has risen from $155.97bn in 2012 to $170.87bn in 2013 (Market watch, 2013) which is a 9.6% increase.
The objective of the Porter’s 5 forces model is to identify and elucidate the current levels of competition existing with a market, by examining what the 5 forces
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Apple however is losing out to Dell in supplying education institutions as there software (Windows) is safer and easier to use than IOS provided by apple.
Bargaining power of suppliers
Apple inc. has high bargaining power over its suppliers due to the fact they can outsource many of their manufacturing products, and have enabled themselves to vertically integrate, meaning they can produce some of their own supplies. This vertical integration has given Apple Inc. great advantages over competitors in the market as they are reducing costs whilst increasing resources.
Threat of substitute’s
The technological environment is changing fast every day. There are not many substitutes in this industry because of the high-tech features. However, alternatives are always available from competitors. If some other company such as BlackBerry, Google, Samsung or Microsoft come up with new technology or the same kind of phone at a lower price or with more features at the same price, then this is a problem for Apple (O’ Grady, 2009). Apple Inc. also proactively dodge’s Gharajedaghi's counter-force of inertia by releasing new innovative products when competitors start to release substitutes for their previous product.
Porters Value Chain
‘Every firm is a collection of activities that are performed to design, produce,

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