Distributor. Sino-US Trade Wars. Management Case Study

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Apple has been impacted by both protectionism measures and Sino-US trade wars. The United States and China have engaged in trade wars for years. The World Trade Organization (WTO) controls and monitors the rate at which countries impose taxes on commodities imported from one country to another. In several instances, China has responded to the restriction policies implemented by the United States by imposing tariffs on products exported to China from the United States. For instance, some of the imports from the United States that are imposed tariffs in China include meat, fruits such as apples and berries, and a 5% tariff on crude oil has also been imposed (CNBC, 2019). On the other side, the United States charges tariffs on a variety of commodities from China, including steel and aluminum, among others. In this regard, it means that the United States agriculture sector is impacted by the tariffs since agricultural-based companies find it challenging to ensure that the products reach the Chinese market. On the other side, China-based organizations may incur more while transporting taxed products to the United States.
Implementation of protectionist policies Between the United States and China have significantly impacted Apple’s production and distribution of its policies. Some of the Company’s products that are facing tariffs in the United States include Apple’s MacBooks and iPhones. Additionally, the United States has also emphasized that15% tariff will be implemented on the other Apple’s commodities, including beads headphones, repair parts, Apple Watch, and AirPods (Gurman, 2019). Such measures are making it impossible for Apple to produce enough products for its customers in the United States. This is mainly because the implementation of the tariff would require Apple to incur more costs while transporting its products to the American market. When this happens, the Chinese government reiterates by imposing tariffs on products produced by companies and manufacturers based in the United States such as meat, fruits such as apples and berries, and tariffs on crude oil. This is particularly done to protect Chinese-based companies such as Apple from stiff competition attributed to foreign companies.
The implementation of tariffs of Apple commodities also has an impact on distributors. It is keynoting that protectionism and Sino-US trade war and the unfavorable protectionist policies are likely to discourage distributors from shipping large quantities of Apple products commodities. Ideally, reduced inventory holding may demand distributors to pay high transportation costs for transporting a low...