Competitive Strengths of Apple

Apple Case Study

Apple

Competitive strength assessment of Apple's computer business

A competitive assessment of Apple reveals that Apple has these factors everything ready devices, design and innovation, R&D oriented, and greater vertical and horizontal integration. Apple has made its devices be everything ready, which reduces the consumer's headache in sourcing for software or additional hardware to suit their individual purpose. Ensuring that the devices are ready for the consumer's use also offers the consumer the confidence to purchase and use the computers. Consumers are willing to pay premium prices provided they know they can get all they need in one device (Pavlou & El Sawy, 2010), and they will not have to search for additional hardware and devices. This differentiation has offered the company competitive advantage over its computer rivals. The design of the computers are attractive, and they are easy to use. Innovation has ensured that the company is able to offer its consumers products that are ahead of time, and they have undergone market research. The innovativeness of the company has allowed it to have computers that challenge the market trends, but are liked and appreciated by the consumers.

Apple is oriented towards research and development. This factor has enabled the company to improve continuously on its computers. R&D orientation has allowed the company to challenge the market and offer products that its competitors do not have. Apple has a greater vertical and horizontal integration, which enables the company to reduce its production costs and control production of its hardware and software. Integrating the development of its products ensures the company can effectively have components that work together and increase efficiency of the overall computer. This integration is vital to the company's competitiveness, since most if its rivals lack integration.

Is the company's competitive positions in the media players and smartphones are stronger or weaker than its position in computers?

In the personal computers market, Apple has a market share of 10% and is ranked third. In the media player market, the company holds 73%, while, in the mobile market, Apple controls 24% and is ranked second (Goasduff & Pettey, 2012). This does reveal that the media player and smartphone have a stronger market share than in the personal computer industry. Since 2007 when the company launched the first iPhone, the smartphone has attracted a greater number of consumers. With subsequent releases, the smartphone has increased in popularity and consumer base. This demonstrates the company has a stronger competitive position in this industry than in its personal computers industry. The product offerings the company has allowed it to differentiate itself and capture a significant portion of the market. Product diversification ensures the company is able to meet the needs of different consumers. The hardware design of its smartphone is unique and demonstrates the company's innovativeness.

The digital players market is highly competitive with various brands that are cheaper than iPods, but Apple has managed to maintain a 73% market share. All the other rivals have not managed to an achieve market share greater than 5%. This demonstrates the company has a stronger competitive position in this industry than in the PC industry. Incorporating and coming up with an integration platform that no other rivals have managed to replicate has offered the company the edge it requires.

Apple Computer's financial performance the past three years

The profitability of the company has increased steadily in the past three years. The company's revenues have also increased from $156.5B to 170.9B (Al-Debei, Aloudat, Al-Lozi, & Al Asswad, 2014). This increase indicates the company's performance and sales have been on the rise. Great innovation and product offering are the main contributors to these increases. Competing in a global market has not been a hindrance to the company, but rather it has contributed towards its competitive advantage. This indicates that the company can compete effectively in local and global markets Apple has seen a decrease in its current liabilities, and an increase in current assets. There had been some downturn in 2012, but the company was able to recover effectively. The efficiency ratios and debt turnover has increased over the past three years, and this does indicate that the company's credit sales are reducing and cash sales are increasing. Debt to equity ratios have remained the same over the past three years, but the company has seen some small fluctuations. These fluctuations indicate the company can effectively balance between shareholder wealth and current liabilities.

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