Apple’s supply chain is ranked best in the world.
Apple’s supply chain is ranked best in the world by the technology research firm Gartner. According to a new report by Gartner. part of the reason is Apple turns over its inventory once every five days. If you think about that’s pretty amazing. Apple ells hundreds of millions of hardware gadgets all over the world and yet it doesn’t actually need to stockpile its goods.
The only company on Gartner’s list of 25 companies that turns over its product faster is McDonald’s, which is not exactly in the electronics business. Dell and Samsung rank two and three in Apple’s category, turning over their inventory roughly once every 10 and 21 days respectively.
We calculated these times from the report’s “Inventory Turn” metric, which estimates the number of times a company’s inventory is sold in a given time period. Apple’s number is 74, according to Gartner (or 76, according to Forbes). From there, it’s a common practice to divide by 365 to “estimate the number of days [of] sales sitting in inventory.”
Fascinatingly, if you read about that inventory turn metric, you will find things like this: “Although results vary by industry, typical manufacturing companies may have 6-8 inventory turns per year. High volume/low margin companies (like grocery stores) may have 12 or more inventory turns per year or more.”
So a typical company in manufacturing might do 8 inventory turns. Samsung does 17. Dell, which practically invented hardcore electronics supply chain management, does 36. Apple is doing 74!
Photo credit: Business Insider
Via The Atlantic