are all the economic factors. The ability of people or purchasing power of Apple products is targeted from medium to high class. Economic factors effect Apple Company’s business process as Apple is recognized internationally. The products components that the company gets from foreign suppliers play an important role because of the exchange rates and currency differences. For example, the sales of Apple products in US will decrease if there is a rise in the US.
PESTEL ANALYSIS Political Factors These factor heavily influences the company’s decision making process. From 2007 to 2009 it is reported that more than a half of sales of their products comes from countries other than America. To reduce their operating cost Apple also spread their product manufacturing to different companies outside America. Cork, Ireland, Korea, China and Czech Republic are some of the other states where Apple placed their company. Bad international relations, wars, terrorism, and public health issues between U.S. and these states might give a negative impact that may damage the Apple Inc. reputation as well as their business process.
Furthermore, the bad political relationship between America and other countries predict the bad outcome for the company. Next, the three crucial economic factors that affect the company include inflation, recession and currency. As Apple products are commonly viewed as luxury products, and with inflation and
Apple on the hand arguably is considered to be the mother of modern smartphones. On June 29, 2007, the cofounder of Apple Inc Steve Jobs announced the release of iPhone, a technology they had been working on for about five years. It was the first of its kind compared to the other players in the market like Blackberry, Motorola and Palm who were already making pocket personal computers. The new tech had a bigger screen, multi-touch interface and the mind-boggling on-screen keyboard was met with a lot of excitement. With these new ideas Apple dominated the phone market and during the Macworld Expo keynote speech, Jobs reported that the Apple iPhone had a 28% market share in Q4 2007 this represented significant growth in the second full quarter that iPhone has been on sale and translated to a
Now if that companies products are being counterfeited, that means that sales the company should have been making are less, because people are buying the fake items on the black-market. This will negatively affect the U.S economy because the company will not be able to hire as many people, and the U.S
An American Apparel store in Los Angeles had to lay off 500 workers because of the recent city increase to $15 an hour (Sherk). This number is shocking, and American Apparel responded saying, they cannot start pay at $15, instead wages should increase as the amount of sales increases. This makes since, for a company cannot spend money they are not receiving. After extensive research and studies, economists have concluded that for every 10% increase in minimum wage, the country could see a 7% decrease in unemployment (Sherk). This could cost the United States over 7 million jobs.
Hence, when it announces the acquisition, firm value may drop simply because investors conclude that the market is no longer growing. The acquisition in this case does not destroy value; it just signals the stagnant state of the market. Why do sellers earn higher return? Buying firms are typically larger than selling firms. In many mergers there are so much larger that even substantial net benefits would not show up clearly in the buyer’s share price.
It would result to relatively lower sales as compared to selling it globally. Moreover, it will result to low profit margins and revenue. Besides, the company will not realize a large business growth as it would when compared with selling across the globe. The customer base will also be low. It will not have a chance to venture in the new and lowly competitive markets.
If producers are not able to produce goods for people, since they will have no money to do it (since people want to decrease spending), then people may lose high quality goods that are essential to living. There are effective and alternative forms to reduce stress: ones that do not involve economies