John Lanchester points out that Apple, is a company which has two reputations. For consumers, it is famous for making cool stuff which is also shiny. For economists, it is famous for its astoundingly high profit margins: last year, its margin hit 47.4 per cent. That is so high it makes analysts do a double-take and rub their eyes. For comparison, Wal-Mart, the biggest company in the world by sales, currently has a margin of 3.3 per cent. So if you buy something from Wal-Mart, you’re giving them 3 per cent of the cash you hand over as profit, but if you buy from Apple, you’re handing over nearly half. How do Apple get away with that, you may well ask?
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