It is the paradox of Apple. Apple is one of the largest seller of smartphones in the world, but Apple does not directly own any factory that makes. A few people wondered why Apple buys it screens from Samsung, LG and Sharp which are competing in the smartphone space. This is because Apple is in business of selling iPhone and the Apple ecosystem, not screens.
Apple sells over 200 million iPhone per year. They do come in various sizes but it’s just around 2–3 sizes. When you are selling 200 million iPhones, you need to make 200 million iPhones. You can either own the factory that build the phones like how Dell does with their computers or get a third party to do the manufacturing for you.
Furthermore, making a modern polished smartphone like the iPhone 12 Pro Max is a complicated process. There is easily 1000 individual components that makes up the final product. Because of the complexity and Apple demanding nature in terms of quality and quantity, outsourcing the manufacturing of the final product is a prudent approach. All Apple needs to do is to manage their vendors, the supply chain logistics and also quality control along the way, which by itself is an amazing feat of the mordern globalized world where everything must work, just in-time.
Both have its advantages and disadvantages, but for Apple, their advantages outweighs the disadvantages. When you want to make 200 million to 250 million iPhones, you have a lot of power with your manufacturer. Apple like other US companies applies the “smile” principal. The design and the sales where the money is maximized and the manufacturing where the cost is minimized.
The advantages for Apple in using Foxconn to build the iPhone and Samsung to supply the screen is flexibility. If Apple does not like Foxconn way of doing things, Apple can take their business away. Just like how Apple apply workers living and dignity standards to Samsung as well.
Samsung might sell around 250 to 300 million phones per year, but it sells around 500 million screens per year because Apple bought their screens. Imaging your customer decided to go to LG with their order of 200 million plus screens, how bad does your year is going to look like? So Samsung might willing to cut prices to keep Apple’s business and others might entice Apple by offering better value. In the end, Apple have bargaining power because of the volume it commands.
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Some of Apple Suppliers
| Supplier | Potential supply item |
|---|---|
| 3M Company | Things |
| AAC Technologies | Acoustics, Precision Processing, Haptics, Optics, Sensor & RF Antenna |
| Advanced Semiconductor Engineering | Semiconductor packaging, testing and electronic manufacutring |
| Alps Electric Company | Electronic components for phones and other devices |
| Amkor Technology Limited | Chip packaging |
| Amphenol Corp | Eletronic and fiber optic connectors, cable and interconnect systems |
| ams AG | Sensor and sensing solutions |
| Analog Devices Inc | Data conversion, signal processing and power management |
| Artesyn Embedded Technologies | Power conversion and embedded computing |
| Asahi Glass | Glass for display |
| Asia Vitals Components | Cooling, casing, hinges, camera and touch panel |
| AT & S Austria Technologie & SystemTechnik | PCB manufacturing |
| Biel Crystal | Back Glass for phones |
| Boyd Corp | Engineered materials and thermal solutions |
| Boardcom Limited | Semiconductor and infrastructure software |
| BYD Electronic | Hanset components and assembly |
| Career Technology | Circuits and related assembly |
| Catcher Technology | Chassis |
| Cathay Tat Ming Precision Metal Products | High Precision Hardware Parts |
| CCL Design | Labels, precision die cut, brand enchancement and protection |
| Cheng Loong | Paper packaging |
| Cheng Uei Precision Company | ?? |
| Chengdu Homin | Tool, Die and Mold Making |
| China Circuit Technology | Printed Circuit Board |
| CN Innovations | Metal and glass processing. Touch panel |
| Coilcraft Inc. | Inductors and transformers |
| Compal Electronics Inc. | Orignal Design manufacturer |
| Compeq Manufacturing | PCB manufacturing |
| Corning Inc. | Specialty glass, ceramic and other materials |
| Cosmosupplylab Ltd. | Eletronic parts and electronics communicatons equipment |
| Cowell E Holdings Inc. | Camera module and optical components |
| Creland Technology Ltd. | ?? |
| CymMetrik Enterprise | Labels, Structural components and enclosure decorations |
| Cypress Semiconductor | Semiconductor components |
| Darfon Electronics | Notebook keyboard and precision components |
| Delta Electronics | DC industrial, computer fans and switching power |
| Derkwoo Electronic | Mobile Phones components, display chassis, ABS |
| Dexerials Corp. | Functional materials |
| Dioes Inc. | Semiconductor |
| DSM Engineering Plastics | High performance plastics |
| Dynapack International Technology | Storage battery manufacturing |
| ECCO leather B.V. | Leather manufacturer |
| Flex Ltd. | Contract manufacturer |
| Flexium Interconnect Ltd. | Flexiable Printed Circuit Board |
| Foster Electric Co. Ltd. | Speakers and headphones |
| Fujikura Ltd. | Communication cables and network equipment manufacturing |
| Fuyang Technology Corp. | AGV (automated guided vehicles), RGV logistics |
| Genius Electronic Optical Ltd. | Lens |
| GoerTek Inc. | Acoustics components |
| Golden Arrow Printing Ltd. | Printing and packaging |
| Guandong Ellington Electronics Tech | Printed Circuit Board |
| Hama Naka Shoukin Industry | Microscrew |
| Henkel AG | Adhesive Technologies, Beauty and Laudary |
| Hi-P International | Industrial mold |
| Hirose Electric | Interface connectors for sensing devices |
| Hitachi Ltd. | Conglomerate |
| Hon Hai Precision (Foxconn) | Actually Foxxconn, electronics contract manufacturer |
| Ibiden | Plastic packaging and PCB |
| II-VI Inc. | Optical material and Semiconductor |
| INB Electronics | ?? |
| Infineon Technologies AG | Semiconductor manufacturer, memory chips, etc |
| Intel Corp | Semiconductor, CPU, etc |
| Interflex Co. | Flexiable Printed Circuit Boards |
| Intermedia Inc. | Online business communication services |
| Inventec Corp. | Computer manufacturer |
| J.Pond Industry | ?? |
| Jabil Inc. | Manufacturing services |
| Japan Aviation Electronics Industry | Electrical connectors |
| Japan Display Inc. | Display technology |
| Jiangsu Changjiang Electronics | Semiconductor system integration packing and test |
| Jilin Liyuan Precision | Manufacturer Aluminum products |
| Jinlong Machinery & Electronics | Resource exploitation, iron and steel production, shipbuilding and electrical machinery |
| Jones Tech | Material Solutions |
| JXTG Holdings | Owned by Eneos, petroleum and metals Conglomerate |
| Kantatsu Co. Ltd. | Design, develop and manufacture electronic components |
| KEMET Corp. | Capacitor Technology |
| Kinsus Interconnect | Ball Grid Array |
| Knowles Corp | micro acoustic, audio processing, and precision devices |
| Kunshan Kersen Science & Tech | Precision metal structural components |
| Kyocera Corp | Ceramics and electronics manufacturing |
| Laird PLC | Electronics and Technology |
| Largan Precision | Camera lens module |
| Lens Technology Ltd. | Lens product |
| LG Chem | Chemical manufacturer |
| LG Display co. | Display manufacturer |
| LG Innotek | Electronic component manufacturing |
| Lite-On Tech | Computer components |
| Longwell Co. | Power cord, cables, connectors and power adapter |
| Luen Fung Group | Precision metals |
| Luxshare Precision Industry | Electronic Component manufacturing |
| LY Investment (HK) | Investment company |
| Marian Inc. | Flexiable Components manufacturer |
| Maxim Integrated Products | Analog and mixed-signal integrated circuits |
| Merry Electronics Co. Ltd. | Electroaucoustics |
| Microchip Tech Inc. | Microcontroller, mixed-signal, analog and flash-IP integrated curcuits |
| Micron Tech. | Computer memory and storage |
| MinebeaMitsumi Inc | Machinery and electronics component |
| Molex Inc | Electric, electronics and optical connectors |
| Murata Manufacturing | Manufacturer of electronic component |
| MYS Group Co. Ltd. | Cardboard and plastic packaging |
| Nanya Tech Corp. | Dynamic RAM |
| Nichia Corp. | Chemical engineering and manufacturing |
| Nidec Corp. | Electric motors |
| Nissha Co. Ltd. | Printing technologies |
| Nitto Denko Corp. | Tapes, vinyl, LCDs, insulation and others |
| NOK Corp. | Oil Seal |
| NXP Semiconductor | Microcontroller, processors and sensors |
| O-film Tech Co. Ltd. | Electronic components |
| ON Semiconductor Corp. | Semiconductor supplier |
| Pai Shing International | Packaging |
| Panasonic Corp. | Electronics Conglomerate |
| Phone In Mag-Electronics | |
| Pioneer Material Precision Tech. | Functional elastomers (rubbers / silicone ) |
| POSCO | Steel |
| Primax Electronics | Computer, electronics and consumer products |
| Qorvo Inc. | Radio-frequency systems |
| Quadrant Solutions | Custom magnetic solutions |
| Qualcomm Inc. | Wireless electronics solutions |
| Quanta Computer Inc. | Notebook and computer manufacturer |
| R.R. Donelley & Sons | Marketing and business communication and commercial printing |
| Radian Opto-Elecrtronics | LCD backlight |
| Renesas Electronics | Semiconductor manufacturer |
| Risuntek Inc. | Eletronic products |
| Robert Bosch | Precision mechanics and electrical engineering |
| Rohm Co. Ltd. | Electronics parts manufacturer |
| SABIC Innovative Plastics | Polymers, Chemical, Argi-nuteriants manufacturer |
| Salcomp | Power adapters and chargers |
| Samsung Electronics | Electronic components Conglomerate |
| Samsung SDI | Storage battery |
| Seiko Advance Ltd. | Screen ink |
| Seoul Semiconductor Ltd. | LED |
| Shandong Innovation Grp. | ?? |
| Sharp Corp. | electronic products, particullary displays |
| Shenzen Desay Battery Tech. | Battery |
| Shenzen Fortuna Tech. | thermoplastic polyuthane (TPU), silicon and plastic field products |
| Shenzen Sunway Communicatoin Co. Ltd. | Mobile terminal antenna |
| Shenzen YUTO Packaging Tech | Brand packaging solutions |
| Shin Zu Shing | Hinge assembly, springs and stamping |
| Simplo Tech | Lithum batteries |
| SK Hynix | memory Semiconductor |
| Skyworks Solutions Inc. | Semiconductor, radio and mobile communications |
| SMK Corp. | Connectors, switches, plugs, etc |
| Solvay SA | Chemical company |
| Sony Corp. | Electronic Conglomerate |
| STMicroelectronics N.V. | Electronics and Semiconductor manufacturing |
| Stora Enso Oyj | Pulp, paper and forest products |
| Sumida Corp. | Inductive components and modules |
| Sumitomo Chemical Ltd. | |
| Sunrex Technology Co. Ltd. | Computer peripheral products |
| Sunwodo Electric Co. Ltd. | Electronic manufacutring services |
| Suzhou Dongshang Precision Ltd. | Precision metal plate and cast metal |
| Suzhou Zhongjemai Panal Industry Tech Ltd. | ?? |
| Swiftronic Holding | Rubber composite material, plastic mold and precision rubber |
| Taishan City Kam Kiu Aluminum Extrusion | Aluminum materials |
| Taiwan Hokoda Tech Ltd. | Aluminum billets and extrusion |
| Taiwan Semiconductor Manufacturing Ltd. | Semiconductor contract manufacturing and design |
| Taiyo Yuden Co. | Electronic parts and recordable media |
| TDK Corp. | Electronic materials and recording / data storage media |
| Texas Instrument Inc. | Semiconductor and integrated circuits |
| The Chemours Co. | Chemical company |
| TK Group | Vegetable oil Conglomerate. Also does ship building, pulp and paper, plastics, cement and textiles |
| Tongda Group Ltd. | Electronic component manufacturing |
| Toshiba Corp. | Conglomerate |
| Toyo Rikagaku Kenkyusho | Metalworking technologies |
| TPK Holding | Touch panels |
| Trinseo S.A. | Plastics, latex binders and synthetic rubber materials |
| Tripod Tech. Co. | Manufacture and distirbution of PCBs |
| Tsujiden Co. Ltd. | Optical films for backlights and other films |
| TTM Technologies Ltd. | PCB manufacturing |
| UACJ Corp. | Aluminum extruded product manufacturing |
| Unimicron Tech. Corp. | PCB manufacturing |
| Unisteel Tech. Corp. | Precision engineering component |
| Unimicron Tech Corp. | PCB manufacturer |
| Unitech Printed Circuit Board Corp | PCB manufacturing |
| Western Digital Corp. | Hard drive and data storage company |
| Wickeder Group | |
| Winox Enterprise Co. Ltd. | Watch braclet, custom jewelery and smartphone casing |
| Wistron Corp. | Orignal Design manufacturer |
| Xiamen Jian Jia Optoelectronics Co. Ltd | Optical film materials, brightness enhancement films, conductive devices and others |
| Yageo Corp. | Passive devices - resistors, capacitors and inductors |
| Young Poong Corp. | Non-ferrous metals |
| Zeniya Aluminum Engineering Ltd. | Aluminum Products |
| Zhen Ding Tech. Ltd. | PCB manufacturing |
| Zhenghe Group | Petrochemical products |
Other suppliers
| Supplier | Potential supply |
|---|---|
| AMD Inc. | CPU / Graphics chips |
| Cirrus Logic Inc. | Analog, mixed-signals and DSP circuits |
| Dialog Semiconductor | Integraed, mixed-signal curcuits |
| Lumentum Holdings Inc. | Optical and photonic products |
| Omnivision Inc. | Image sensor manufacturing |
| Parade Tech. Inc. | LCD panel timing controllers |
| Silicon Works Co. Ltd. | Mixed-signals Semiconductor |
| SiTime Corp. | Silicon based timing solutions |
| Synaptics Inc. |