Management Principles Assignment (Porter's Five Forces on Apple Inc.)

7487 WordsOct 15, 201230 Pages
ementContents Section | Assessment | Page | 1 | Introduction | 4 | 2 | Contents | | | * 2.1 To analyze the company’s practices/operations in relation to the selected topic. | 5-9 | | * 2.2 To identify and explain the relevant principles and concepts of management (in relation to the selected topic) those are being applied in the company. | | | * 2.3 To identify and explain the pros and cons in the application of the relevant principles and concepts of management in order to find the problems that will be encountered by the company | 10- 16 | 3 | Recommendations | 17- 21 | 4 | Conclusion | 22 | 5 | Bibliography | 23-25 | 6 | References | 26- | 1.0 Background In April 1976, Steve Wozniak and Steve Jobs were…show more content…
This is because the customers perceived the value of Apple’s products and they are willing to pay a higher price to obtain it. Apple is buying those inputs in a large volume and it allows Apple to negotiate good terms and pricing with its suppliers. “When suppliers are reliant on high volumes, they have less bargaining power, because a producer can threaten to cut volumes and hurt the supplier’s profits.” (“Apple - Five Forces Analysis,” n.d.) As a result, Apple get discount for bulk purchasing from the suppliers which in turn, lower down the cost of production and indirectly increase the profits generated. iii. Bargaining Power of Buyers Customers are the buyers of goods or services offered by the firms. “The bargaining power of buyers is also described as the market of outputs: the ability of customers to put the firm under pressure, which also affects the customer's sensitivity to price changes.” (“Porter five forces analysis,” 2012) Customers are able to negotiate lower price with sellers if they have a high bargaining power. The bargaining power of buyers for Apple Inc. is low. Apple is focus on niche market, which is targeted on the people who have special demands for technological products. Apple tailors its

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