Economies of Scale is defined as the cost reductions that occur when production of a company increases. These are basically the advantages that occur when the size of a particular business increases. This usually happens due to the relationship between the fixed cost of the product and the quantity produced. A large number of units produced with fewer input costs leads to Economies of Scale.
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Apple Economies of Scale
There are aspects of Economies of Scale that Apple potentially faces, the first and the very obvious being Technical Economies of Scale. We know the variety of gadgets Apple manufactures and how popular those gadgets are in the market. Therefore, we can get an idea about the quantity in which these products, or the components used in these products are manufactured or acquired.
Apart from this, the fact that a lot of the products in their lineup share more or less the similar internal components, if not the same, means that the company can acquire those parts, (such as the processing chips), in bulk and benefit from Marketing Economies of Scale.
By now most technology enthusiasts or even the general consumers are aware of Apple’s products and why they sell as much as they do. The products offer exceptional performance, unbeatable digital privacy, superior build quality (when compared to the competing products in the market) and bullet proof reliability, along with good after sale’s service and a wide range of compatible accessories available in the market. They are also generally priced higher as compared to products from its rival brands.
When it comes to buying these products, customers who can afford their premium products don’t mind the hefty price tag as that usually means that they won’t have to compromise in terms of the experience they receive from the product.
That is not the only strategy Apple uses to be stay at the top of the list though. Their most effective strategy that contributes in huge amounts to the success of the tech giant is their Ecosystem.
You must have heard about the infamous Apple Ecosystem. It is basically a community of electronic gadgets made by Apple that interact flawlessly with each other with the help of their software, making tasks convenient and providing the user with an effortless experience. What makes Apple’s ecosystem better than those from other Companies, you might be wondering. It is simply the fact that no other ecosystem works as flawlessly and beautifully as Apple’s does and the fact that once you get into the Apple ecosystem, it tries to make sure that you stay in it and not have any reason to feel like you need to migrate to a different ecosystem.
This ecosystem leads to customers buying Apple’s version whenever they are in need of a particular gadget, because it’ll just work that much better and connect flawlessly with the other Apple devices that the individuals own, making things easier for them in the process.
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