Apple supply chain management

Operations and Supply Chain

Build to the highest standards.
Deliver on the highest expectations.

Apple products are made with revolutionary precision to perform exactly as promised. And because customers all over the world eagerly await that experience, we built a supply chain that’s equally revolutionary. Join these teams and continue to innovate on an immense scale.

Read more about Jen’s story

Working as an engineer on the Advanced Manufacturing team at Apple, Jen designs automation for final assembly. She works with the Product Design teams, visiting China for hands-on engineering experimentation to find the balance between the best possible product and the best possible way to manufacture it. What excites Jen most about her job is the freedom to explore ideas and use her imagination all day. “At Apple, you’re encouraged to discover your own way and step out of the box. You have a lot of freedom to create the best product and end result possible.”

Find a team and begin your own story here.

Business Intelligence and Analytics

The decisions made at Apple have a significant impact, often well beyond the company itself, which is why the detailed contributions of this group are so critical. Their timely and actionable insights help solve complex business problems across multiple areas of operations. Their methods include critical reporting, ad hoc analytics, and advanced analytics/machine learning. Areas of work include Customer Engagement, Supply Chain Optimization, Product Quality, Operations Execution and Fraud Detection, and Sales Channel Program Analytics.

Business Process Management

Apple is all about the customer experience, even in ways customers may not notice. This team is responsible for keeping things humming as finished products move through our supply chain and sales channels. And they work cross-functionally with other Apple teams to come up with ways to improve processes, such as making it simple for customers to order a product online and pick it up in a store. Areas of work include Project Management.

Supply Demand Management and NPI Readiness

Join the team that forecasts demand and drives supply. These are the people who help achieve financial and sales goals while ensuring great customer experiences. They develop demand forecasts that support numerous key activities at Apple, ranging from corporate P&L forecasting and planning to daily factory builds and customer-level allocation. The supply plans drive manufacturing capacity and materials purchase requirements for this week through next year. In preparing for a new product introduction (NPI), this team also ensures that customers receive our products when promised through all channels of sales. Areas of work include Supply and Demand Management, Reseller Operations Management, and New Product Readiness.

Retail and E‑Commerce Fulfillment

Be part of the group that helps provide a seamless, high-quality retail experience for our customers. You’ll help maximize customer engagement and product sales by ensuring the right inventory is in the right place at the right time, and by providing fast and convenient fulfillment solutions to Apple customers. This team also collaborates cross-functionally to define fulfillment roadmaps and optimizes management systems, tools, and process flow in Apple supply chains. Areas of work include Inventory Control, Retail Fulfillment Planning, and Program Management.

Read more about Shravan’s story

Apple’s bold design visions make it to the real world with plenty of help from Shravan and his colleagues on our Manufacturing Design Engineering team. To realize Apple products and designs at scale, Shravan is well-versed in the intricate design and functional requirements of precision manufacturing processes. Each new Apple product pushes the limits, so Shravan and his team do, too — they develop innovative approaches toward CNC machining, joining technologies, lasers, robotics, assembly, and more. “The best part of my job is working with the best design, engineering, and operations teams to solve highly complex technical problems in creative ways. It really opens up your mind in terms of what is possible with both manufacturing and design.”

Logistics and Supply Chain

As part of this team, you’ll help put Apple’s products in the hands of its customers in the fastest and most efficient manner possible. You’ll do it by managing global systems, processes, and negotiations that create an efficient and low-cost supply chain while providing an exceptional customer experience. Areas of work include Procurement, Logistics Operations, Loss Prevention, and Supply Chain Analytics.

Sales Planning and Operations

Apple has some of the world’s most diverse sales channels, delivering products and services to consumers, enterprises, and education and government customers in more than 80 countries. As part of this team, you’ll stand alongside our sales groups and partners to develop the strategy, planning, execution, and operational excellence needed to ensure that we make the most of every customer interaction. Our channel programs include physical and digital merchandising, staffing, sales training, and in-store technology. Areas of work include Channel Program Management, Point-of-Sale Operations, Sales Training and Enablement, Contracts Management, Channel Shared Services, Sales Program Analytics, and Apple Executive Briefing Programs.

Procurement

Apple products are unique, and they couldn’t happen without this team’s specialized talents. Join them to deliver innovative component technologies, coordinate the global supply chain, and collaborate closely with Apple’s key technology and manufacturing partners. Team members manage materials throughout the entire product life cycle, drive the strategy for future partnerships, lead commercial negotiations, and strike agreements that meet Apple performance criteria and secure long-term supply continuity. Areas of work include Global Supply Management, Materials Program Management, Strategic Licensing, OEM Business Operations, Operations Product Development Management, and Channel Manufacturing Process Management.

Manufacturing and Operations Engineering

How do you build a great idea? With more great ideas — the kind of thinking that transforms the work of our industrial designers into the devices that enrich the lives of our customers. Join this team to develop manufacturing engineering solutions that deliver our products with unprecedented precision at an unprecedented scale. You’ll help design and customize equipment, create manufacturing processes, refine tooling, identify suppliers, and work with key operations partners to optimize capacity and cost — without losing sight of our incredibly high standards for quality. Areas of work include Mechanical Design Engineering, Process Engineering, Tooling, DFM/DFX Engineering, Automation, Information Systems, and Technical Program Management.

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Operations and Supply Chain

Build to the highest standards.
Deliver on the highest expectations.

Apple products are made with revolutionary precision to perform exactly as promised. And because customers all over the world eagerly await that experience, we built a supply chain that’s equally revolutionary. Join these teams and continue to innovate on an immense scale.

Read more about Jen’s story

Working as an engineer on the Advanced Manufacturing team at Apple, Jen designs automation for final assembly. She works with the Product Design teams, visiting China for hands-on engineering experimentation to find the balance between the best possible product and the best possible way to manufacture it. What excites Jen most about her job is the freedom to explore ideas and use her imagination all day. “At Apple, you’re encouraged to discover your own way and step out of the box. You have a lot of freedom to create the best product and end result possible.”

Find a team and begin your own story here.

Business Intelligence and Analytics

The decisions made at Apple have a significant impact, often well beyond the company itself, which is why the detailed contributions of this group are so critical. Their timely and actionable insights help solve complex business problems across multiple areas of operations. Their methods include critical reporting, ad hoc analytics, and advanced analytics/machine learning. Areas of work include Customer Engagement, Supply Chain Optimization, Product Quality, Operations Execution and Fraud Detection, and Sales Channel Program Analytics.

Business Process Management

Apple is all about the customer experience, even in ways customers may not notice. This team is responsible for keeping things humming as finished products move through our supply chain and sales channels. And they work cross-functionally with other Apple teams to come up with ways to improve processes, such as making it simple for customers to order a product online and pick it up in a store. Areas of work include Project Management.

Supply Demand Management and NPI Readiness

Join the team that forecasts demand and drives supply. These are the people who help achieve financial and sales goals while ensuring great customer experiences. They develop demand forecasts that support numerous key activities at Apple, ranging from corporate P&L forecasting and planning to daily factory builds and customer-level allocation. The supply plans drive manufacturing capacity and materials purchase requirements for this week through next year. In preparing for a new product introduction (NPI), this team also ensures that customers receive our products when promised through all channels of sales. Areas of work include Supply and Demand Management, Reseller Operations Management, and New Product Readiness.

Retail and E‑Commerce Fulfillment

Be part of the group that helps provide a seamless, high-quality retail experience for our customers. You’ll help maximize customer engagement and product sales by ensuring the right inventory is in the right place at the right time, and by providing fast and convenient fulfillment solutions to Apple customers. This team also collaborates cross-functionally to define fulfillment roadmaps and optimizes management systems, tools, and process flow in Apple supply chains. Areas of work include Inventory Control, Retail Fulfillment Planning, and Program Management.

Read more about Shravan’s story

Apple’s bold design visions make it to the real world with plenty of help from Shravan and his colleagues on our Manufacturing Design Engineering team. To realize Apple products and designs at scale, Shravan is well-versed in the intricate design and functional requirements of precision manufacturing processes. Each new Apple product pushes the limits, so Shravan and his team do, too — they develop innovative approaches toward CNC machining, joining technologies, lasers, robotics, assembly, and more. “The best part of my job is working with the best design, engineering, and operations teams to solve highly complex technical problems in creative ways. It really opens up your mind in terms of what is possible with both manufacturing and design.”

Logistics and Supply Chain

As part of this team, you’ll help put Apple’s products in the hands of its customers in the fastest and most efficient manner possible. You’ll do it by managing global systems, processes, and negotiations that create an efficient and low-cost supply chain while providing an exceptional customer experience. Areas of work include Procurement, Logistics Operations, Loss Prevention, and Supply Chain Analytics.

Sales Planning and Operations

Apple has some of the world’s most diverse sales channels, delivering products and services to consumers, enterprises, and education and government customers in more than 80 countries. As part of this team, you’ll stand alongside our sales groups and partners to develop the strategy, planning, execution, and operational excellence needed to ensure that we make the most of every customer interaction. Our channel programs include physical and digital merchandising, staffing, sales training, and in-store technology. Areas of work include Channel Program Management, Point-of-Sale Operations, Sales Training and Enablement, Contracts Management, Channel Shared Services, Sales Program Analytics, and Apple Executive Briefing Programs.

Procurement

Apple products are unique, and they couldn’t happen without this team’s specialized talents. Join them to deliver innovative component technologies, coordinate the global supply chain, and collaborate closely with Apple’s key technology and manufacturing partners. Team members manage materials throughout the entire product life cycle, drive the strategy for future partnerships, lead commercial negotiations, and strike agreements that meet Apple performance criteria and secure long-term supply continuity. Areas of work include Global Supply Management, Materials Program Management, Strategic Licensing, OEM Business Operations, Operations Product Development Management, and Channel Manufacturing Process Management.

Manufacturing and Operations Engineering

How do you build a great idea? With more great ideas — the kind of thinking that transforms the work of our industrial designers into the devices that enrich the lives of our customers. Join this team to develop manufacturing engineering solutions that deliver our products with unprecedented precision at an unprecedented scale. You’ll help design and customize equipment, create manufacturing processes, refine tooling, identify suppliers, and work with key operations partners to optimize capacity and cost — without losing sight of our incredibly high standards for quality. Areas of work include Mechanical Design Engineering, Process Engineering, Tooling, DFM/DFX Engineering, Automation, Information Systems, and Technical Program Management.

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Apple Supply Chain Excellence

Everything about Apple Inc is the talk of the town. For example, the new iPad, iPhone, Apple Map or even the environmental and labor issues at its suppliers’ facilities. Surprisingly, IT research firm Gartner ranks the supply chain of Apple Inc as the best supply chain in the world for many years. Without a doubt, Apple Inc is the world leader in Innovation, Branding, Customer Service and Software Ecosystem. But, is Apple’s Supply Chain really the number 1? This case will show you the analysis of their core processes, challenging issues and complexities of its operations.

Apple Supply Chain Model

Information about the Supply Chain of Apple Inc is a bit here, there and everywhere, it’s tough to find the actual case. To the best of my knowledge, many business schools still use the case «Apple Computer’s Supplier Hubs: A Tale of Three Cities» from Stanford University (1996). To get a closer look at the modern-day supply chain at Apple Inc, this case utilizes a content analysis technique. Annual Report (SEC Filing) is analyzed and a simplified supply chain model is constructed as below,

Supply Chain Planning at Apple Inc is the classic example of the New Product Development Process (NPD). It’s the integration of R&D, Marketing and various functions under supply chain management. From the above graphic, Apple Inc accelerates the new product introduction by acquiring the licensing and 3rd party businesses. The whole process looks very similar to that of other industries. The interesting point is that Apple Inc has to make the prepayments to some suppliers to secure the strategic raw materials.

Supply Chain Map is the way to express a large system from the points of origin to points of consumption in a simple to understand manner. Information from the annual report is also used to produce the Supply Chain Map.

Apple Inc purchases raw materials from various international sources, then get them shipped to an assembling plant in China. From there, the assembler will ship products directly to consumers (via UPS/FedEx) for those who buy from Apple’s Online Store. For other distribution channels such as retail stores, direct sales, and other distributors, Apple Inc will keep products in Elk Grove, California (where central warehouse and call center are located) and supply products from there. At the end of a product’s life, a customer can send products back to the nearest Apple Stores or dedicated recycling facilities. Actually, Apple tries to follow the lean manufacturing concept as much as possible but not six sigma as used by samsung.

Apple Supply Chain Challenges

What does it feel like to be «Apple Inc»? One journalist indicated that the life of Apple Inc is fairly easy by utilizing its negotiation power. Believe me, supply chain of Apple has very high risks. There are many challenges to overcome, for example,

— Global economy could affect the Company.
— Some re-sellers may also distribute products from the competing manufacturers.
— Inventories can become obsolete or exceed the anticipated demand.
— Some components are currently obtained from the single or limited sources.
— Some custom components are not common to the rest of the industry.
— Ability to obtain components in sufficient quantities is important.
— Supply chain disruption such as the natural and man-made disasters can be serious.
— The company depends on logistical services provided by outsourcing partners.
— The company also relies on its partners to adhere to supplier code of conduct.

The above information is also from the annual report. As you can see, most of the risks are on the supply side.

How Complex is Apple Supply Chain?

1. Inventory Turnover
Inventory Turnover is a traditional financial measure to determine how efficient company uses its financial resources to create sales, the higher number is the better. Supply chain professionals also use this metric in the inventory management function. The generally accepted calculation is [Cost of Goods Sold / Average Inventory]

Inventory Turnover of Amazon vs Apple Inc

The above picture shows that the inventory turnover of Amazon and Apple is 10 and 59 respectively (cost of goods sold of digital content/downloadable products is excluded). From the face value, Apple seems to be more efficient. Anyway, there is a reason for this. Apple Inc is now a marketing company with no manufacturing facility, but Amazon is a distributor of general merchandise. It’s pretty natural that Amazon has to keep more stocks. Then the inventory turnover is much lower.

2. Number of Key Suppliers
Supply chain management is about the relationship between trading partners. Working closely with strategic suppliers will bring a competitive advantage to the firm.

Number of Key Vendors Amazon vs Apple

Apple recently said that they have about 156 key vendors across the globe. This amount of suppliers is quite manageable. Amazon has about 3 million suppliers in total. Top 5% of this is 300,000 suppliers, way more than that of Apple Inc.

3. Number of Warehouse Facilities
In the United States, transportation cost is the biggest portion of the total logistics cost. Then, good management of related function is essential.

Number of Warehouse Facilities Amazon vs Apple

Number of SKUs Amazon vs Apple

5. Product Life Cycle
Put it simple way, the product lifecycle is how long you can sell products (the longer is better).

Product Life Cycle Amazon vs Apple

From the rough estimate, Amazon has some seasonal products such as summer wear. They can only sell it for 3 months max. The life of Apple’s key products is way more than 12 months. It goes without saying that the demand forecast of seasonal, short life cycle products is very difficult to estimate.

As you may notice, based on the example characteristics, Amazon’s Supply Chain is far more complicated than that of Apple Inc.

Lesson Learned from Apple Supply Chain

The results of the analysis of Apple’s processes, challenging issues, and complexities indicate that the success of its supply chain operations depends on how well they manage the supplier relationship. This includes early supplier involvement in new product development, close communication, and supplier performance improvement/evaluation. Then, Apple Inc is dubbed as «King of Procurement.»

Apple Supply Chain References

— Kopczak, L. R. (1996). Apple computer’s supplier hubs: A tale of three cities. Stanford University Case.

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