Apple Tows Matrix Essay

Pestel Analysis Political Factors : * War, terrorism, geopolitical uncertainties; issues beyond company’s ability to control. * 52% of the company’s net sales in 2007 coming from countries outside America. * Manufacturing or logistics might be interrupted by political events in the manufacturing countries. Economic Factors : * Overall global economy outlook is not good. * Inflation reduced consumer’s expenditure on luxuries. * Economic crisis influencing Apple’s retail’s business. Social Factors : * A variety of regulations & law for health and Safety may adversely affect company’s financial condition. * It is reported that the improper use of iPod may lead to hearing loss for users. * Technological Factors : * Fast technological changes. * Frequent introduction of new products and the continual improvement in product performance. Legal Factors: * Employments laws nationally and internationally * Tax laws in the U.S. and other countries * Foreign trade laws * Environmental Factors * Apple products are made from a high grade titanium which is to reduce pollution during the making and be recyclable as well * Products are also energy star qualified so they do not burn as much energy as traditional laptops do Porter Five Forces Threat of New Entrants-Low * As the Apple leads the market with the different products like Pc, iPhone, iPad and iPod which are full of the features. * As the Apple’s customer are loyal and they are ready to pay even the premium price to the company. * Apple has no debts. New entrants will not affect them initially. * The leaders of the market already capture the major distributors like * AT&T and Verizon in U.S which gain the 60% of the  market. Same thing with Hp, Toshiba, etc. Threat of Suppliers: Moderate * The supplier of the products like, memory, chips, disks and drive are not the same. * The products that are provided by the companies are standardized and had no substitute. * The companies are going to use the standardize products to reduce the cost hence the suppliers products essential for the industry. * As they are many suppliers in number, so the switching cost is low. * The products that are provided by the companies are standardized and had no substitute. * The industry is the growing industry and for the suppliers it is very profitable. Bargaining Power of Buyers: Moderate * The buyers are few and the customers are now moving towards the big stores like superstores, electronic retailers and web based retailers. * The buyers are seemed more concern about the product features and availability. * The products like PC’s and the mobiles phones are very individual and the brand is definitely critical for the success. * As there are many suppliers of the products like the * Apple, HP, Dell etc in the market and they all struggle for the distribution. The switching cost for buyers is low. Competitive Rivalry: High * The industry is fastest growing industry as the product lifecycle is not long. * The business has a high cost as in the case the all the players fight for the market share by cutting their cost. * The products are highly differentiated, because all are branded. * * The brand is definitely is critical for the success that is why the * Apple has a larger profit margins. * The competitors in the industry are using the different strategies. * The companies in the industry are in the market with the different strategies Threat of Substitutes: Low * There are many substitute of the technologies * Switching brands sometimes is costly but sometimes is easy. It may depends on the how much the product is standardized with the demanded features.