Apple Analysis

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Apple Corporation Apple operates in two primary industries: Computing-Hardware and Software Delivery of Entertainment and Media Apple has always been under intense competition within the computer, software, and entertainment industries. Every time that Apple had jumped into a lead in a product category during the past two decades, it had difficulty in sustaining its leadership position. Porter's uses the five forces, supplier power, and barriers to entry, threat of substitutes, buyer power, and the degree of rivalry, as tools that help analyze a company's position against its competitors. (QuickMBA site, 2003). Threat of new Entrants: Startup costs are extremely high so the probability of new entrants is low. The existing companies have capitalized on the distribution channels and have created strong branding awareness that makes it difficult for new comers to compete. The probability of success is so low that competitors pursue niche markets rather than trying to compete with the bigger companies. Apple positioned itself years before so it has created its space in the computer industry just as (IBM, Hewlett-Packard, Gateway and Dell). Bargaining Power of Suppliers: The suppliers are plentiful and must compete with others to ensure that they will be able to retain the business of the computer companies. The position is low especially since the larger companies can readily switch to another supplier without any major repercussions. Suppliers adjust pricing and quality to make their products more attractive so competition is high leaving them in a low supplier power position. Bargaining Power of Buyers: All of Apple's customers have a variety of computer companies from which to choose when it comes to purchasing hardware, software, or peripherals. Switching costs are low. The buyer has the ability to switch when quality,

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