Mba 502 Apple Production Discussions

Apple is not new to the cell phone world, in fact they are over a decade into producing some of the most popular phones in the world market today. Continuing to be in such high demand, they must keep the wheels turning, and just like any company or any brand, they look to find the most stream like and cheapest ways to produce a quality product. 

Apple production is obviously not completed here in the US, but actually comes from many countries around the word. Over a couple hundred of these just create the products inside the nifty Iphone X you have in your pocket right now, consisting of stainless steel, glass, a battery, circuit boards, plastic, some other doodads, and a display (Özgün, 2018). For a fun list of the actual parts and pieces, check this fun article out https://technology.ihs.com/596781/iphone-x-costs-apple-370-in-materials-ihs-markit-teardown-reveals. From these two countries these parts and pieces get sent to only two different manufacturing sites in Taiwan, but it is rumored India will take some of the burden on shortly after the beginning of this year (Phartiyal, Varadhan, 2018). Foxconn, the employer of those whom put your fancy phone together employs their team at a small $1.60 an hour (Özgün, 2018).  After the hard workers finish assembling all the little pieces, it will cost only about $370, but once it kits the shelf at your local store it will now cost you around $1,200. Go chew on that one knowing how long you’ll be paying off your new toy.

Since we need to transport these devices all around the world, but for my concern here to the US where I can buy one, there will be a charge for that. In the beginning if we are moving these small parts to other places to then be assembled, we will introduce transportation fees. Shipping them to the Foxconn sites, as well as getting them here to the US on none other than a Boeing 747, then some smaller trips to then be distributed around the states where hundreds of people will wait in line for some of the first ones released (Özgün, 2018).

Some of the biggest factors that can affect the mix of inputs used to produce this technology is material costs, transportation costs such as gas or shipping prices, introduction of new technology that can eliminate something or might need to adda piece to increase the performance, as well as human labor and the cost of work/machinery.

Apple greatly benefits from economies of scale, as they have kept their inventory low, and this is no new game of theirs. To keep inventory low, and to slow move on from past models, they keep from having to fix past mistakes while instead they offer the market a substitute that is trendy, new, shiny and desirable. The interface is practically identical so moving on up is no hard task. 
According to authors both Kimberly Amadeo (2018) and Konstantin Kakaes (2016) the reason Apple has almost completely outsourced this process is not due to “low labor costs” as much of us believe, but it is due to a couple factors. The first being that the bulk buying ability over seas would put Costco to shame, being able to buy in bulk brings your per unit price lower and lower the more to get. Apple knows