APPLE INC.

I. INTRODUCTION

Apple Inc. is an American multinational technology company that revolutionized the technology sector
through its innovation of computer software, personal computers, mobile tablets, smartphones, and
computer peripherals.

One of the most recognizable brands in the world, Apple created the first commercially successful personal
computer and was also the first to bring the graphical user interface (GUI) into mass adoption.

Founded by Steve Jobs and Steve Wozniak in 1976, Apple set new benchmarks in product innovation,
user-centric functionality, aesthetics and design, and multiproduct integration. Apple redefined and
transformed the capabilities of modern computing. Further, Apple innovated the industry by establishing a
marketplace ecosystem for third-party application developers, leveraging this new economy to expand its
products’ functionalities and strengthen its position. The company is headquartered in
Cupertino, California.

VISION, MISSION AND VALUES

Mission
Apple is committed to bringing the best personal computing experience to individuals around the world
through its innovative hardware, easy-to-use software and sleek product design.

Vision

Apple, Inc.’s vision, as found on their website, is “Apple is committed to bringing the best personal
computing experience to students, educators, creative professionals and consumers around the world
through its innovative hardware, software, and Internet offerings”

Values

Apple, Inc.’s values can also be obtained from their company website and include the following factors:
We believe that we’re on the face of the Earth to make great products. We believe in the simple, not the
complex. We believe that we need to own and control the primary technologies behind the products we
make. We participate only in markets where we can make a significant contribution. We believe in saying
no to thousands of projects so that we can really focus on the few that are truly important and meaningful
to us. We believe in deep collaboration and cross-pollination of our groups, which allow us to innovate in a
way that others cannot. We don’t settle for anything less than excellence in every group in the company,
and we have the self-honesty to admit when we’re wrong and courage to change.
EXTERNAL ANALYSIS

General Environment

Global: 1. Developing foreign economies could cause Apple’s production facility in China
to increase costs as wages in China increase.

2. Government laws regarding environmental concerns could affect Apple.

Demographics: 1. Buying power of consumers could decrease as wages flatten.

2. Aging population could influence Apple’s product design development.

Political/Legal: 1. Legal battle with Samsung over patents.

2. Apple’s unethical way of re-routing profits to mitigate American taxes.

Economic: 1. Recent recession could cause buyers to spend less and save more. Apple’s
products could be seen as out of range for buyers.

Sociocultural: 1. Consumers’environmentalconcernscouldinfluenceApple’sdevicemanufacturing.

2. Consumers may value more portable and faster devices; therefore, Apple’s
devices could be seen as “outdated.”

3. Trends: Bigger screens and more functions could outdate Apple’s products.

Technological: 1. Apple’s products nearing end of product cycle; (Ex) iPhone and iPod
nano/touch.

2. Rapid changes in technology could outdate Apple’s technology.

3. Apple’s diverse product line may become obsolete (Macbook Air, Macbook
pro, iPad, iPad mini, iPhone, iPod Touch, iPod Nano, Mac Mini, etc.).

Industry Environment

1. High dependence on technology, high demand.

Power of
2. Varying needs.
Buyers
3. Moderateswitchingcosts(switchfromoneOStoanother:e.g.MacbooktoWindows).
1. Few chip designers, but there is one dominant player (Intel).
Power of
Suppliers
2. High switching costs from suppliers.
Threat of 1. “Smartphones” that perform same basic functions (word processing, etc.). 2. Increasing
 use of tablets for their portability.
Substitutes
3. Alternateformsofentertainment(TV,Movies).
1. Economies of scale: need a lot of resources to develop an electronics company. 2. Many
Threat of
large players and consumers have brand loyalty (Mac lovers).
New Entry
3. Mobilephonesmakersenteringtabletmarket(Samsung,Blackberry,Windows).
1. High: intense price competition and “who’s better and faster.”
Competitor 2. All computer/electronic devices have standardized components: small area to differ in
Rivalry product function.
3. Products have similar life cycles, hard to maximize life span.

Competitors

Software: Windows, Android.

Smartphones: Samsung, Xiaomi.

Laptops: Sony, Dell, HP, Asus

INTERNAL ANALYSIS

Tangible Resources

1. Massive technical patents.

2. Apple stores - retail locations.
3. Tailored hardware and software system.
4. Well-fortified and global supply chain.

Intangible Resources

1. Industrial design capability.

2. Steve Jobs’ vision.
3. Relations with original equipment manufacturers.
4. Talented software development team.
5. Patents.

STRATEGY

Apple’s Corporate Strategy

1. Dominant Business type of diversification: 70% -95% of their revenue comes from a single business.
 2. The dominant business: computer business. Supporting businesses: software and chips businesses.
3. Related constrained diversification.

Apple’s Business Level Strategy

1. Differentiation strategy.
2. Focuses on high quality and innovation.
3. Offers strong graphic performance with great design.
4. Creates brand loyalty.
5. Products can be imitated at a lower cost structure than apple focuses on superior quality and innovation
focuses on superior quality and innovation.

Apple’s International Strategy

1. Follows a global strategy.

2. Promotes its products worldwide as a standardized product.
3. Uses centralized control to tightly monitor and coordinate their pricing across different international markets.

Apple’s Cooperative Strategy

1. Uses strategic alliances and joint ventures to enter markets.

2. Alliances with companies like HP and Nokia to promote products
3. Joint venture with Nike to create the Nike+Ipod to further brand recognition in other markets

TARGET MARKET

Apple’s target market focuses on marketing to people with a few different characteristics. Apple’s main
target market is middle to upper class people because usually this demographic has the means necessary to
pay the higher premium price for Apple products (Gaille, 2015).These people are willing to pay a little
extra for quality and have the income to do so. 94% of Apple users are more affluent than those who
purchase other brands of mobile devices (Gaille, 2015).

Millennials are also a huge target market for Apple as Millennials are typically hooked on technology more
than other generations and are seeing an influx of money. The average age of an Apple customer is 35 – 44
and 1 in 4 people in the 18 – 34 age demographic say they plan to purchase an Apple product within the
next six months (Gaille, 2015).

Apple also targets those who enjoy music. Apple’s products are all focused on the iTunes store and the
ease of music downloads. People who enjoy music and want an easy way to store, share and purchase
music are drawn to Apple products (Gaille, 2015). Also professionals in the media and design fields also
find Apple products to be preferable because Apple products pride themselves on making creative
functionality a key factor in all of their devices (Gaille, 2015).
APPLE INC. SWOT ANALYSIS
STRENGTHS WEAKNESSES
• 13.9 % market share • Limited distribution network
• Strong brand equity • High selling prices
• High R & D • Battery limitation issues
• High profit margins • Absence of Steve Jobs
• Great Marketing • Short Product Life
• Consumer loyalty
• Software/OS
• Consistency in design
OPPORTUNITIES THREATS
• Distribution network expansion • Aggressive competition
• Rising demand for tablets and • Imitation
smartphones • Rising labor costs
•Creation of new product lines • Loss of innovations
• Formation of strategic partnerships • Tax scandals
• Accessory potential

II. INFLUENCED BY INTERNATIONAL BUSINESS FACTORS

1. Positive influence

 Political Stability and Government Support Policies

- Countries with stable policies and a business-friendly environment create favorable
conditions for Apple to expand its branches and production facilities. Free trade agreements
and tax incentives can help reduce costs and facilitate Apple’s globalization process.
Supporting Evidence:
- Apple expanded its manufacturing operations in China due to government incentives,
allowing the company to access a large market and reduce production costs. Additionally,
favorable tax policies in countries such as Ireland have helped Apple optimize its
profitability.
- Apple expanded its manufacturing operations in China due to government incentives,
allowing the company to access a large market and reduce production costs. In October
2024, Apple CEO Tim Cook announced plans to strengthen investments in China during a
meeting with China’s Minister of Industry and Information Technology, Jin Zhuanglong, in
Beijing. Cook emphasized Apple’s commitment to contributing to China’s supply chain
development and leveraging new opportunities in this market. reuters.com
- This visit marked Cook’s second trip to China in 2024, highlighting the strategic importance
of the Chinese market to Apple, despite the company's recent loss of market share due to
competition from domestic rivals. During the meeting, discussions covered Apple’s
operations in China, online data security management, and cloud services. Chinese officials
 expressed their hope that Apple would strengthen its collaboration with local enterprises and
share the benefits of high-quality development. reuters.com

 Developed Economies and High Purchasing Power

- Countries with developed economies and high purchasing power present significant
opportunities for Apple to distribute its products, enabling the company to expand its market
reach and drive revenue growth.
Supporting Evidence:
- Apple has established retail stores and offices in developed nations such as the United
States, Japan, and various European countries. These regions possess strong economies and
high-income levels, providing favorable conditions for consumers to invest in Apple’s
premium products.
- Apple has announced a plan to invest $500 billion in the United States over the next four
years, creating 20,000 new jobs, primarily in research and development. This plan includes
the construction of a new manufacturing facility in Houston, Texas, dedicated to servers
supporting Apple’s artificial intelligence program, which is expected to generate thousands
of jobs. thetimes.co.uk
- In Germany, Apple has expanded its presence by establishing the European Silicon Design
Center in Munich, making it the company’s largest engineering hub on the continent.
Munich is now home to Apple’s European Silicon Design Center, focusing on advanced
silicon technologies. images.apple.com

 Technology and Innovation

- The application and development of new technologies are crucial factors in enhancing
Apple’s products and services. International business enables Apple to access global
technological resources, thereby driving innovation and product improvements.
Supporting Evidence
- Apple has developed products such as the iPhone and iPad by collaborating with technology
suppliers worldwide. The company partners with firms in Japan, South Korea, and other
countries to integrate advanced technologies and enhance hardware components.
Collaboration with TSMC (Taiwan Semiconductor Manufacturing Company):
- Apple has partnered with TSMC to develop micro-OLED display technology, an ultra-
advanced display built directly on a chip substrate. This technology enables thinner, smaller,
and more energy-efficient displays, making it well-suited for future augmented reality (AR)
devices. The project is currently in the trial production phase and is expected to take several
years to reach mass production. trangcongnghe.vn
Collaboration with Luxshare-ICT
- Luxshare-ICT, headquartered in Shenzhen, China, has grown from a small component
manufacturer into a major company serving numerous international clients, including Apple.
Since joining Apple’s peripheral component supply chain in 2012, Luxshare-ICT has been
involved in the production of products such as AirPods and Apple Watch. In Vietnam, the
company has expanded its manufacturing operations with factories in Bắc Giang and Nghệ
An to accommodate Apple’s supply chain relocation needs. brandsvietnam.com
  Cultural Expansion and Diversity
- Expanding into international markets allows Apple to engage with diverse cultures and
consumer needs, enabling the company to develop products that align with the preferences
of each market.
Supporting Evidence
- Apple has adapted its marketing strategies and product designs to suit different markets. For
instance, the company has introduced iPhone models with storage capacities tailored to the
needs of emerging markets, where the cost of a smartphone is often a critical consideration.
Apple’s marketing campaigns frequently incorporate cultural nuances and local references to foster a
deeper connection with consumers. unapixent.com

 Distribution Network and Logistics

International business enables Apple to expand its global distribution and logistics network. Establishing
branches and manufacturing facilities in different regions helps reduce transportation costs and strengthens
Apple's global presence.
Supporting Evidence
- Apple has built distribution centers in various countries, including India, China, and
Southeast Asian nations, to enhance accessibility and reduce logistics costs.
Distribution Center in California, USA:
Located in Silicon Valley, this center facilitates the distribution of Apple products across the United States.
Covering approximately 1 million square feet and employing a workforce of 500, it processes around 10
million products annually. essfeed.com
Distribution Center in China
Located near major manufacturing facilities in Shenzhen, this center serves the demands of the Chinese
market. Spanning 800,000 square feet and employing 700 staff members, it processes approximately 15
million products annually. essfeed.com
European distribution center:
Located in the Netherlands, this center distributes Apple products to European countries. With an area of
600,000 square feet and 600 employees, the center handles approximately 12 million products annually.
essfeed.com
 Collaborating with Global Strategic Partners
- Engaging in international business enables Apple to collaborate with strategic partners,
thereby expanding its business network and enhancing its competitiveness.
Supporting Evidence
- Apple has partnered with major mobile carriers worldwide, such as Verizon and AT&T, to
expand its product distribution capabilities and increase revenue. One example is Apple’s
agreement with China Mobile, the world’s largest carrier with over 700 million subscribers,
to distribute iPhones in China. This contract was signed at the end of 2013, allowing Apple
to reach a vast customer base in the Chinese market. tinhte.vn
2. Negative influence

2.1 Exchange rate fluctuations

 o Cause: Apple does business in many countries with different currencies. As the dollar
strengthens, Apple's product prices become more expensive in foreign markets, reducing
demand and revenue converted into dollars. Conversely, when the USD is weak, profits can be
affected due to high production costs.
o Apple's solution:
- Flexible pricing: Apple often adjusts the selling price of products in different countries to
offset the impact of exchange rates.
- Financial hedging: Use financial instruments such as futures and options to minimize risk
from exchange rate fluctuations.
- Transparent financial reporting: In financial reports, Apple often clearly separates the effect
of exchange rates so that investors understand the company's true situation.

2.2 Trade wars and tariffs

o Cause: Trade tensions, especially between the U.S. and China, could lead to higher tariffs on
Apple products or components from Chinese suppliers. This increases production costs and
selling prices, affecting competitiveness and profitability.
o Apple's solution:
- Supply chain diversification: Apple has shifted some of its production to other countries
such as India and Vietnam to reduce its dependence on China and avoid high tariffs from the
U.S. and China.
- Lobbying: Apple is actively working with the U.S. government to minimize the impact of
import tariffs and apply for tax exemptions for some components.
- Local production: In India, Apple has expanded iPhone production to meet the requirement
for localization and reduced import duties.

2.3 Dependence on the Chinese supply chain

o Cause: The majority of Apple's products are assembled in China. Issues such as pandemic
lockdowns, supply chain disruptions, and political pressure can cause component shortages,
increase costs, and delay new product launches.
o Apple's solution:
- Production shift: Expand production to India, Vietnam, and Mexico to reduce risks from
political issues and production disruptions in China.
- Supplier Diversification: Partner with various suppliers outside of China to avoid relying on
a single source.
- Investment in production technology: Promote automation and upgrade of production
facilities in other countries to increase efficiency and reduce costs.

2.4 Fierce competition

o Cause: Brands such as Samsung, Xiaomi, and other domestic brands are constantly launching
products with lower prices and comparable features. This is especially pronounced in
developing markets, reducing Apple's market share.
o Apple's solution:
- Product Diversification: Expand the product line with various price segments, such as the
iPhone SE and older versions at lower prices to compete in emerging markets.
- Service ecosystem: Focus on services like iCloud, Apple Music, Apple TV+, and Apple Pay
to grow revenue that doesn't depend entirely on hardware.
 - Invest in research and development: Continuously improve technology and exclusive
features such as Apple Silicon chips to differentiate yourself from the competition.

2.5 Local Legal and Tax Regulations

o Cause: Each country has its own tax, data security, and antitrust regulations. Additional
penalties and taxes could reduce Apple's profits. For example, the EU used to fine Apple for
tax-related and monopoly issues.
o Apple's solution:
- Compliance and negotiations: Apple accepts local requirements, like paying taxes in full in
the EU and complying with data privacy regulations. At the same time, the company is also
actively negotiating to reach more favorable agreements.
- Adapt to privacy laws: Apply advanced security measures and comply with GDPR
regulations in Europe and similar laws in other regions.
- Brand positioning: Promote the image of a transparent company and protect user privacy to
reduce legal pressure.

2.6 Protectionism and Localization Requirements

o Cause: Some countries require Apple to produce or store data on-premises (e.g., India and
Russia). This requires Apple to invest in infrastructure and adjust its supply chain, which
increases operating costs.
o Apple's solution:
- Investment in on-site production: Expand production in India and start assembling many
iPhone models here to meet the requirement of localization rate.
- Job Creation and Collaboration: Invest in research and development centers and collaborate
with local manufacturers to reduce pressure from the government.
- Negotiate with the government: Negotiate for tax incentives and support when expanding
production in countries such as India and Vietnam.

2.7 Privacy and security issues

o Cause: Data breaches and pressure from the government (such as requiring security agencies to
unlock devices) can reduce consumer confidence, affecting sales.
o Apple's solution:
- Strong privacy policy: Apple has introduced features such as App Tracking Transparency
(ATT) and end-to-end encryption to protect user data.
- Transparency: Provide reports on data access requests from the government and commit not
to create backdoors in their products.
- Effective Communication: Leverage security and privacy images as a competitive
advantage, helping to increase user trust.

2.8 Economic recession and global inflation

o Cause: When the global economy is in recession, consumers tend to cut back on spending on
high-end products such as iPhones, iPads, and MacBooks. Inflation also increases production
and transportation costs
o Apple's solution:
- Diverse product lineup: Offers a variety of price points, from high-end products like the
iPhone Pro to older versions that cost less.
 - Installment and financial services: Apple implements interest-free installment programs and
yearly upgrades to make products more accessible to consumers.
- Cost Optimization: Negotiate with suppliers and optimize the supply chain to control
product costs.

2.9 Impacts from social and environmental movements

o Cause: Pressure from environmental and labor rights organizations to demand transparency and
improved labor conditions in the supply chain. These costs can affect profit margins
o Apple's solution:
- Green commitment: Apple has set a goal of carbon neutrality by 2030 and is investing
heavily in renewable energy and recycled materials.
- Supply chain transparency: Publish annual reports on the environment and labor conditions
in the supply chain to meet shareholder and customer requirements.
- Sustainable Design: Minimize the use of plastic packaging and optimize product design to
extend the life cycle

Among the negative factors affecting Apple's international business, dependence on the Chinese supply
chain can be considered the most negatively influencing factor. Detailed reasons include:

o High degree of dependence on China

- Fact: Apple relies on partners like Foxconn to make the majority of its products in China. In
2013, Foxconn employed about 1.4 million workers in China to assemble products such as
iPhones and iPads. en.wikipedia.org
- Impact: This dependence makes Apple vulnerable to fluctuations in China, including labor
issues and local policies

- Apple's solution:

 Diversifying production: Apple has expanded iPhone assembly in India through partners
such as Foxconn and Wistron, in a bid to reduce its dependence on China. soha.vn
 Increased investment in new markets: Apple has announced plans to invest $500 billion in
the U.S. over the next four years to expand production, minimizing the impact of import
tariffs imposed by the U.S. government on Chinese goods. Youth

- Proposed solution:
 Increased automation: Apple can promote the use of robots and artificial intelligence (AI) in
the production process to reduce dependence on cheap labor in China.
 Collaborate with more suppliers: Strengthen cooperation with companies in the US and
Europe to increase the supply of critical components.

o Risks from US-China trade tensions

- Fact: The trade war between the U.S. and China has led to the imposition of significant
tariffs. For example, in March 2025, President Trump imposed a 25% tariff on goods from
Canada and Mexico, along with 10% on goods from China. Although the main goal is to
 address national security issues, these measures are also aimed at boosting domestic
production and reducing dependence on foreign products. wsj.com
- Impact: These tariffs could increase Apple's manufacturing costs, leading to higher selling
prices and reduced competitiveness in the international market

- Apple's solution:
 Lobbying: Apple has lobbied the US government to reduce tariffs to support domestic
memory chip production, affirming its readiness to bring more production to its homeland.
vietnammoi.vn
 Production shift: Apple has expanded production in India and Vietnam to reduce
dependence on China and avoid the direct impact of US-China tensions. Vietstock

- Proposed solution:
 Develop new markets: Strengthen market expansion in Africa, Latin America, and the
Middle East to reduce dependence on the Chinese market.
 Autonomy in core technology: Invest in research and development (R&D) of semiconductor
chips and strategic components to mitigate risks from technology embargoes.

o Risks from policy and legislation in China

- Fact: The Chinese government may impose protectionist policies or export controls on
critical components and materials for Apple. In addition, security and data control
requirements also create a challenge for Apple in balancing compliance with Chinese law
and protecting user privacy. wsj.com
- Impact: Changes in policies and legal regulations can affect Apple's ability to manufacture
and distribute products, causing disruptions in the supply chain and increasing operating
costs.

- Apple's solution:
 Local regulatory compliance: Apple has accepted the storage of Chinese user data in
domestic data centers at the request of the Chinese government.
 Strategic cooperation: Apple has signed agreements with Chinese companies such as
Tencent and Alibaba to retain users.
- Proposed solution:
 Create an independent technology ecosystem: Apple can develop a separate service platform
in China to comply with regulations without affecting global data.
 Leverage local subsidiaries or partners: Establish joint ventures with Chinese businesses to
comply with the law but still control the business.

o Supply chain disruptions due to COVID-19 and natural disasters

- Fact: The COVID-19 pandemic has caused major disruptions in the global supply chain,
affecting production at Apple's factories in China. Lockdowns and movement restrictions
have slowed down production and deliveries. wsj.com
- Impact: This disruption not only affects short-term revenue, but also reduces customer and
investor confidence in Apple's ability to manage its supply chain.
 - Apple's solution:
 Supply chain shift: Apple has expanded its manufacturing centers in India and Southeast
Asia to ensure supply chain continuity. Vietstock
 Critical component stockpile: Apple has increased critical component stockpiles to avoid
shortages during disruptions.

- Proposed solution:
 Application of Blockchain technology: Use Blockchain to track and manage the supply
chain in real-time to react faster to risks.
 Develop a flexible contingency plan: Establish a "multi-center" production model so that
supply can be quickly switched when disruptions occur.

o Cost of shifting and diversifying the supply chain

- Fact: To reduce its dependence on China, Apple has started shifting some of its production
to other countries such as India and Vietnam. However, this process requires large
investment costs and takes years to achieve the same efficiency as operating in China.
wsj.com
- Impact: This shift could negatively affect profits in the short term and not immediately
address the risk of dependence on China.

- Apple's solution:
 Long-term investment in India and Vietnam: Apple has expanded production of iPhones and
MacBooks in these countries to gradually reduce costs. diendandoanhnghiep.vn
 Take advantage of incentives from local governments: Apple has partnered with the Indian
government to receive tax incentives and infrastructure support. VnEconomy

- Proposed solution:
 Use a regional production model: Develop a regional production model, for example,
manufacturing in the US for the North American market, manufacturing in Europe for the
EU market to reduce shipping costs and tariffs.
 Strengthening cooperation with manufacturing partners outside China: Instead of focusing
only on Foxconn and Pegatron, Apple can expand cooperation with technology companies
in Japan, South Korea and Germany.