Apple though is at a pivotal point in its history. Competition is now fierce and Apple’s growth is stalling.
There’s a lot to love about Apple, its history iconic leaders and pioneering design. But let’s face it, others have caught up.
Apple is now looking quite exposed with over 55% of revenue from a single product line which is facing fierce competition, particularly from Asia. Is Apple is in jeopardy of following in the footsteps of Nokia?
Part of any SWOT requires is an analysis of the company’s financial performance, market and the Apple business model.
In this Apple SWOT analysis, I’ll take a look into the external challenges Apple faces – the Opportunities and Threats, as well as its internal capabilities to realize the opportunities and deal with the threats – Strengths and Weaknesses.
What is the SWOT analysis For Apple?
The SWOT analysis of Apple analyses the internal capabilities of Apple (strengths and weaknesses) as well as the external environment (opportunities and threats). The result shows Apple is at a pivotal point in its history.
Financial Analysis of Apple
To see the full breakdown of Apple’s financial results
Corona virus Outbreak
Apple manufacturers like Foxxconn were forced as a result of the coronavirus in China. Additionally, Apple stores in China shut their doors creating a further problem. China accounted for $43 billion of sales in 2019, roughly 16.5% of total sales, but now sales have plummeted. Not only has Apple’s supply chain has been disrupted but retail across the globe has suffered from lockdowns in major markets.
Intensity of Competition
Smartphones are a crowded market where more and more consumer electronic companies have now compete. The strongest brand at the moment is Samsung, but the market for smartphones, music streaming, entertainment streaming is becoming more competitive. As an example, Disney used to license its content to Netflix but has more recently launched Disney+.
Asia has seen its own homegrown streaming video services such as Youku Tudou and Hooq.
New Disruptive Brands
Oppo which is largely unknown in the west has grown to become China’s top smartphone – a clear case of disrupting the established players. These disruptive newcomers could expand and erode Apple’s dominance by offering lower-cost phones with similar features to gran the lower end of the market then move upmarket with higher-end phones.
The US government has imposed a tariff on imports from China. Inevitably this will lead to an increase in the overall cost of Apple products. This could create the perfect storm and along with coronavirus and talks of a downturn in the economy, even devoted Apple fans might seek solace in lower-cost smartphones.
Rising Costs in China
The cost of labour in China has and continues to rise as the China economy evolves. In turn, this could place further pressure on pricing at a time when Apple continues to push premium products over more economical versions.
Intellectual Property Infringements
Apple and Broadcom had to pay out $1.1 billion for infringing the California Institute of Technology’s patents. While Apple has money to pay for this, it brings into question their ethics and approach to intellectual property and the potential for related cases.