APPLE'S SUPPLY CHAIN

Apple's Supply Chain Management



Introduction2

History2

Background3

The Cork Facility, Ireland5

The Fountain Facility, Colorado5

Sacramento Site, California5

Implementation of Supplier Hubs6

Cork facility, Ireland7

The Fountain facility, Colorado7

Comments on the Case7

Recommendations for Sacramento site8

Conclusion8

References10

Apple's Supply Chain Management

Introduction

Owing to the rapid increase of growth and popularity of Apple Computer Incorporated, a need for the company's expansion arose, which called for the establishment of more production lines to offer adequately, the increased proportion of its customers. To tackle this intense crisis, the company looked into a total of four alternatives, dealing in different aspects to overcome the issue. However, the alternative that the company adopted was to implement a supplier hub while maintaining a contract with a logistic service provider.

The company implemented its first hub in the year 1991, in the city of Cork, Ireland. A year later, the company established its second hub in the city of Fountain, Colorado, which also resulted in amendments in the contact in the form of a Supplier Hub Service Agreement. The company developed its OPS Centre which operated in the Sacramento site and benefited the company tremendously because of its various advantageous factors (Radhakrishnan, 2001, pp. 136). History

In the mid of the year 1994, today's world's leading company known as Apple Inc., went through some serious crisis. The major crisis of all was the space shortage that the company had to face by June of the same year. Owing to the increasing success of the company, the company's manufacturing site in the city of Sacramento, California, seemed to be lacking in space as more production lines had to be laid down. To deal with the issue, an alternative that was being considered was to implement a supplier hub.

The primary reason that led to the surfacing of this issue was the company's rapidly increasing growth and the increased demand of its products, which by then, included the desktop PC and other server PC products. This called for up to 60,000 square feet of more land to establish and maintain more product lines to cater the company's increased number of customers. According to Clark Winchester, who is the director of the company, this is one challenge that every rapidly expanding company faces, particularly during instances of sudden heightened growth (Kopczak, 2013).

The decision that the concerned authorities agreed on, was a reduction in the volume of total raw materials that comprised of purchased components. It was decided that these materials could be stored off-site in huge quantities, and whenever required, could be transported to feed the production line as per the requirements. At that time, four alternatives for binging about a reduction in the on-site components inventory were being considered (Datamonitor, 2006);

To establish a warehouse nearby to deal with the company-managed warehouse

To develop a contract with a company dealing in logistics

To have suppliers that manufacture or stock their produced components on local basis so that a local source of supply can be maintained

To contract with a logistic company so that a supplier hub can be implemented

Background

Founded in Menlo ...