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Population and Natural resources
China is classified as a developing country and has the most significant population in the world. According to the latest statistics, China has a total population of 1,381,057,076 people, which accounts for 18.72% of the world’s total population. This is a clear indication that 1 in every five people resides in China. The total area of land in China is 9,390,784 sq. km, and it is densely populated with 147 people per square kilometer.
Such a high population is suitable for Apple since it offers the company the necessary market for its products. Apple has devised a supply chain process that is quite effective in ensuring that every individual in China gets the required awareness regarding Apple’s products. Through such a supply chain, Apple reaches its customers more easily and quickly, given that a more significant percentage of the residents live in urban areas.
China is the world’s leading mining country due to the availability of significant and valuable reserves of iron, coal, lead, mercury, graphite, antimony, copper, and tin, among others. The resources of underground water produce up to 870 billion cubic meters annually. With such resources, the economy of China is bound to grow, which increases the purchasing capabilities of the residents.
Most people in China make use of public means of transport. As such, Apple has capitalized on this to ensure that there are all sorts of devices that customers can use to play games as well as stream TV shows during commutes. In addition, Apple’s development of new products targeting China’s population is based on the fact that China’s population has become more conscious as far as different brands are concerned. For this reason, Apple ensures that the market is filled with quality brands to cater to the needs and demands of the entire China population.
GDP per capita and Labor skills
The GDP of a country is the total monetary value of the goods and services produced within the country’s borders in a year. According to the World Bank statistics, China’s GDP as of 2014 was 3865.88 USD, which is equal to 31% of the total GDP in the world. Such a high GDP is attractive for Apple since it acts as an indication of the purchasing power of the citizens of China. With a high purchasing power in the country, Apple has focused on ensuring that various products are available for customers with a lot of concern on customers’ income.
Additionally, most of Apple’s plants in China get cheap Labor from the locals. By making use of the cheap Labor, the company saves a lot on expenses, and thus, such money can be channeled to other areas of the company’s operations. In efforts to rectify the challenges of the lack of skills, there was a call for exploration of innovativeness as well as the ways that can be used to reform China’s education system, which led to an improvement in the skills possessed by the workforce in China in 2015. This works favorably for China since the company will continue getting cheap but skilled Labor from the locals.
Wage scales and other costs
Due to the rapid economic growth in China, the wage rate has been increasing over the last few years. In addition, the population that is joining the workforce is comprised of fewer young people who have the skills and knowledge that Apple requires. The transport system in China is well-developed, with adequate means of transport to major cities. For this reason, Apple has established several markets in China, given that availing products to various parts of China are not a challenge due to the well-developed infrastructure. Furthermore, legal and insurance costs in China are low. For this reason, Apple targets a low cost of production due to the availability of the required raw materials and cheap Labor.
Cultural factors and Education
Culture plays a significant role in the determination of how people relate with one another. It is defined as the manner in which different things in an organization or a country are handled, which is accepted and can be passed to new generations. China is characterized more by collectivism than individualism. China has a beautiful education system that is regarded as the largest in the world. Statistics indicate that the government of China has made a massive investment in the education system. Apple ensures a thorough understanding of China’s culture, and this has been instrumental in the company’s avoidance of cultural barriers.
Crime issues and political Stability
China can be defined as a better country than the US in terms of security. For instance, in the US, it is straightforward to kill an individual at gunpoint and take their valuables. In China, all is safe, and the causes of crime such as rape and harassment of foreigners are rare. The political state of China is stable. This makes China suitable for Apple’s investment.
Supportive Logistical Systems
China has a developed system of logistics and transportation that gives it an opportunity to supply various places of the world with different commodities. Apple has developed customized and complete solutions on the supply chain. This saves the company from the cases of expiry of some things as they can always be delivered to the required destinations on time.
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