Logistics: The Unsung Hero In Apple’s Success.
September 12, 2016 by Staff
Filed under Money/Business, Tech/Internet, Weekly Columns
(Akiit.com) What makes Apple such a successful company? To the average person, it’s all about their products. And to an extent, this is true – you only have to look at the hordes of people queuing outside Apple stores on launch days for evidence. The Apple brand is synonymous with the cutting edge tech and simple user experience that sells by the million.
But scratch beneath the surface and there is something else that Apple do incredibly well. And it’s something that all businesses should be looking at if they want to make themselves a success: logistics.
The basics
You can have the greatest idea for a product in the world, but unless you can get it to market quickly and efficiently, it’s going to fail. Logistics and supply chain management are vital to controlling costs and delivering success – and it takes a lot of work to get right. But how do Apple do it – and what lessons can we all learn? Let’s break down Apple’s supply chain and find out how they were ranked number one for best supply chain by Gartner.
Do one thing perfectly
If you manufacture everything and anything, it makes it incredibly difficult for your business to keep on top of costs. Where Apple differ from many other companies is that they only offer a small range of products at any one time. Not only that, but many of their products share the same technology. It means they are cutting out many potential problem areas in their supply chains.
Monitor everything
Apply make use of innovative technology to run tight control over their inventory. Your business should be doing the same. Look at supply chain solutions that maximize your returns on your cargo transportation costs. Keep your inventory to the bare minimum, without impacting on your sales. And seek flexible solutions to monitor everything, letting you make quick decisions based on your sales volume.
Use the right suppliers
Around 97% of the materials in Apple devices are made by other businesses. In fact, it takes two hundred -odd companies to create the materials used in Apple products.While this might sound like a lot, it isn’t – and it means that Apple can retain tight control over its relationships with its suppliers. And those relationships are key. They help you keep product quality at high levels and give you a lot more say when it comes to negotiating new contracts. When Apple find the right supplier, they order in astonishingly high volume. Of course, this keeps that supplier super profitable. But at the same time, they become integral to that provider’s income. It results in Apple being able to strike far better deals around the negotiating table.
Clever shipping
The average person on the street may not know this. But in logistics circles, Apple are renowned for being innovative in their transportation methods. In effect, they sometimes corner the entire air freight market by booking in huge shipments. It enables them to satisfy consumer demand, but at the same time leaves their competitors unable to use those same shipping routes. Ruthless, yes. But it’s savvy business practice that all companies should bear in mind.
Staff Writer; Bobby Palmer