Friday, January 27, 2012

A kinder, gentler @Apple ? Don't bet on it - the dark side of producing Apple's products in China


It's not the first time the Times and other publications have written about the "punishing" work conditions at Foxconn, the contract manufacturing behemoth that also makes products for loads of other companies, not just Apple.

Foxconn--headquarted in Taiwan, but (according to Reuters) the largest private employer in mainland China--has been frequently in the news for fires and explosions at its factories along with a spate of worker suicides. But coming on the heels of Apple's jaw-dropping earnings and news that it had $98 billion squirreled away in cash, the article seems to have really touched a nerve, the "Occupy Apple" kind.

I don't think anybody's faulting Apple for wanting to make a good profit on its products or trying to keep up with demand. But what seems to be the big friction point is how much profit Apple is making and how it continues to squeeze its suppliers and manufacturing partners to the Nth degree.

The Times article depicts Apple as creating a vicious circle where suppliers and manufacturers desperately long for Apple's business ("Getting a contract from Apple can lift a company's value by millions because of the implied endorsement of manufacturing quality," the article states). But then it puts the big squeeze on everybody, making it exceedingly difficult for anybody but Apple to turn a profit.

You don't make $46.3 billion in a
quarter by being terribly nice.

The reporters, Charles Duhigg and David Barboza, serve up several damaging quotes but here are a few that seem to really hit home for a lot of readers:

"The only way you make money working for Apple is figuring out how to do things more efficiently or cheaper. And then they'll come back the next year, and force a 10 percent price cut."



Read more: http://reviews.cnet.com/8301-18438_7-57366923-82/a-kinder-gentler-apple-dont-bet-on-it/#ixzz1kgP2xLvC

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