Apple Inc Company
Apple Inc is a multinational electronic company based in California in the United States of America. It was incorporated in the United States under the name Apple Computer Inc with Steve Wozniak and Steve Jobs as the directors. Due to shift in production from computer manufacturer to digital and communication developer, the company changed its name to Apple Inc in 2007. Today, it has grown its portfolio to include designing, producing and marketing of consumer electronics. Its products include computers, smart phones, software such as OS X and iOS and media devices like Apple TV. Enderle (2004).
Although Apple products are the most expensive in the world, its sale has soared past the expectation. According to company sources, 2 million orders had been made before the release of iPhone 5. Many more customers were eagerly waiting by Apple stores worldwide to get the latest Smartphone. While the iPhone 5 retails at $ 649, a Samsung Galaxy SIII Smartphone with similar specification cost $ 429. From this comparison, it is evident that Apple does not focus on pricing as a strategy. The company relies on product quality to generate the revenue needed to spur growth. O'Grady (2009).
Apple Inc. products conform to elasticity factor in the market. Perceptibly, Apple Company has very strong profit margins on these products in the market; approximately 50% for the 64-gigabyte iPad, 48% for the 16-gigabyte iPad, and 52% for the 32-gigabyte iPad. From these facts in the market, it can be inferred that the company’s products has price elasticity of demand. Price elasticity is therefore, a measure of the proportion change in quantity demanded related to 1 % change in price. Hansen, Mowen & Guan (2009).
In conclusion, the Apple Company always record higher profit margin compared to the other companies that offer products with the same features as Apple product. Their ability to produce high quality products has enabled them to enjoy plethora of customers across the world.
References
Enderle, R. (2004). Apple’s Competitive advantage. Retrieved on January 28, 2013 from: http://www.technewsworld.com/story/33061.html
O'Grady, J. D. (2009). Apple Inc. Westport, Conn: Greenwood Press.
Hansen, D. R., Mowen, M. M., & Guan, L. (2009). Cost management: Accounting and control . Mason, Ohio: South-Western.
