Apple gets paid for its products before it has to pay for their manufacturing

http://9to5mac.com/2012/07/22/apple-gets-paid-for-its-products-on-average-before-it-has-to-pay-for-their-manufacturing/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+9To5Mac-MacAllDay+%289+to+5+Mac+-+Apple+Intelligence%29

by electic • 14 years ago

2 3 14 years ago

9to5mac.com

Keithamus• 14 years ago

This is very common practice in large business, where the payment terms to suppliers are sometimes much longer periods than the time to purchase. Amazon, for example, have the same strategy, where they can sell the majority of their stock before paying for it. It also happens in the recruitment industry, where large companies who hire contractors can wait up to 6 months before paying the recruiters (to pay contractors), who end up in cyclical debt trying to pay the contractors on time.

benro• 14 years ago

They have a negative cash conversion cycle - Dell mastered this in the late 90's.

easp• 14 years ago

Hmmm. This seems to leave out part of the picture. Apple is also using its substantial cash pile to lock up supplies of key components. Some supplies get paid well past delivery, others may get money well before.

Apple gets paid for its products before it has to pay for their manufacturing

Related Stories