Good morning please help me with this question When you read the above , it becomes clear a well-defined procurement strategy and good inventory management can deliver supply chain success and could ultimately lead to profitability and growth. In a report, you are required to critique the strategic importance of procurement and the roles of inventory in the supply chain (balancing supply and demand and Buffering against uncertainties) in relation to Apple. please add reference if you can thank you
Good morning please help me with this question When you read the above , it becomes clear a well-defined procurement strategy and good inventory management can deliver supply chain success and could ultimately lead to profitability and growth. In a report, you are required to critique the strategic importance of procurement and the roles of inventory in the supply chain (balancing supply and demand and Buffering against uncertainties) in relation to Apple. please add reference if you can thank you
Chapter8: Strategic Analysis: Understanding A Firm’s Competitive Environment
Section: Chapter Questions
Problem 2CTQ: How has Teslas strategic position changed since it was founded in 2003?
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Good morning
please help me with this question
When you read the above , it becomes clear a well-defined procurement strategy and good inventory management can deliver supply chain success and could ultimately lead to profitability and growth.
In a report, you are required to critique the strategic importance of procurement and the roles of inventory in the supply chain (balancing supply and demand and Buffering against uncertainties) in relation to Apple.
please add reference if you can
thank you

Transcribed Image Text:Apple: Kings of Inventory Management
Apple
Apple's fiscal third quarter P&L results were impressive. But one balance sheet item also caught my
attention. Despite the COVID-19 disruptions, Apple still seems to be the king of inventory
management. When Apple reported fiscal third quarter earnings, on July 30, the conversation
revolved around income statement performance. In other words: how well the iPhone had sold, how
much revenue growth the services segment experienced, how margins behaved, etc.
But one balance sheet item caught my attention. Despite the 11% increase in product revenues in the
quarter, Apple's inventory dropped by over 3% year over year. Even in an environment of demand
uncertainty and disruptions caused by the COVID-19 crisis, Apple seems to have managed its supply
chain tightly.
Best-in-class
A couple of months ago, I talked about how Apple's inventory management practices have been
world class. CEO Tim Cook's attitude towards it helps to explain the company's obsession:
"Inventory is fundamentally evil. You kind of want to manage it like you're in the dairy business. If it
gets past its freshness date, you have a problem."
So what?
Apple's days inventory outstanding, which measures how long inventory sits in stock before being
sold, also increased slightly in 2020 over last year's levels. Yet, the less than 10 days on average have
been substantially better than Sony's and Intel's one month or longer.

Transcribed Image Text:The benefit of keeping inventory levels so low is twofold. First, large inventory balances mean that
cash remains tied up in the supply chain, which is usually not good news. Part of the reason why
Apple has managed to generate so much cash in the past decade or more is the company's ability to
manage working capital (which includes inventory) so well.
Second, low inventories allow Apple to be more nimble. With the multiple product refreshes each
year, the Cupertino company can afford to have the latest devices available for purchase without
having to discount older models too deeply, or risk having its product stock become obsolete.
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