Unit 1: Business Environment
Apple is the company that I am going to be talking about in this assignment; I will be talking about how different economic environments affect two countries Apple operates in (China, USA) and what countries they are manufactured and assembled in. They’re stores are usually located in the central main shopping centre of a city especially their stores in the UK. The company Apple is a private limited company and the company is open to the public to buy shares in the organisation. The company is based in the secondary sector of business. Here is a table stating some of the economic factors that may affect Apple.
China United Kingdom
GDP China ...view middle of the document...
90 percent in 2002. U.K. unemployment rate for the three months to April 2011 was 7.7 per cent of the economically active population, down 0.3 on the quarter. The total number of unemployed people fell by 88,000 over the quarter to reach 2.43 million.
Currency 0.101512697 in pounds 0.642880103 in pounds
Economic factors affect every organization in the world of business on a regular basis. Economic factors can affect almost all of the elements of business; sales, annual profit, employment and cost to name a few. Economic factors may affect a business in a positive or negative way depending on how the economics have changed in the country where a business operates.
Changing which country a business will manufacture, assemble or purchases materials to produce their products may benefit the company depending on the GDP and allowance rates. E.g. If Apple buys the materials for its products in China then the GDP in China rises then it may be cheaper for Apple to buy its materials from a different country.
U.S.A economic factors that affect Apple
Operations and performance of Apple inc depend a lot on economic conditions across the world. Uncertainty about global economic conditions poses a risk as consumers and businesses postpone spending in response to tighter credit, unemployment, negative financial news and/or declines in income or asset values, which could have a material negative effect on demand for the Company’s products and services. Demand also could differ from the Company’s objectives because Apple may raises prices on goods and services sold outside the U.S. to set off the effect of a strengthening of the U.S. dollar. Economic factors such as increases in energy costs (gas, petrol, heating, and diesel), changes in the real estate, unemployment, healthcare costs, could influence consumer spending. These and other economic factors could affect demand for the Apple’s products and services and the Company’s financial condition and operating results.
The U.S. represents Apple’s largest geographic market. About 39% of the organization’s net sales in 2011 came from sales to customers who purchased apple products in the U.S. Final assembling of Apple products is currently performed in the Company’s manufacturing facilities in Ireland and Asia. The supply and manufacture of a number of components is performed by sole-sourced outsourcing partners in the U.S., Asia and Europe. Single-sourced outsourcing partners in Asia perform the final assembling of all of the Company’s hardware products. Sales of Apple’s products in foreign countries, and on sales of products that include components obtained from foreign suppliers, can be adversely affected by foreign currency exchange rate changes and by international trade regulations, including tariffs and antidumping penalties.
The average US household lost nearly 39% of its wealth from 2007 to 2010, the Federal Reserve said Monday, emphasizing the impact of the financial crisis...