iPhone assembly

What is the cost of production of various Apple products?

iDevice manufacturing costs?

There are factors that impact the profit margin of devices that do not affect other OEM’s. Supply chain management and logistics, augmented revenue streams from a growing entertainment binary distribution of media, Apples strategy on memory….not only purchasing but distribution in all of their devices, this war footing on design and build materials, and the fact that when they procure, they do it in volumes that allow them to dictate what price they are going to pay, or they will simply procure exclusively from a competitor.

Component cost on the bill of materials is no indicator what the cost of that device. Apple doesn’t pay close to what the BOM price is because they don’t buy piece parts.

When they wanted sapphire, they bought the sapphire company, a building and then funded the operation to be the largest sapphire grower on the planet.

When they want memory, they weave it into as much of their engineering designs as possible and buy all of what everyone has to the point they are the worlds largest Flashram chip distributor.

When they need logistics transport for holiday and product release shipping they buy airline exclusivity months in advance.

And most of all, they do it because their customer likes it, expects it and almost demands it because they are so used to it.

And Apple is happy to oblige their well-heeled customers who buy their hardware products which are a delivery method to sell digital products like music and entertainment.

This is why Apple,e will usually bend over backwards to get a replacement back tot the user at the Apple Store when the situation is devoid of abuse or neglect. iDevices¬†that are broken don’t sell apps games and music.

What is the cost of production of various Apple products?

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