Apple maintained strict control over its supply chain, negotiating discounts on material costs and insisting on access to flexible manufacturing capacity. Suppliers were expected to provide a detailed breakdown of costs for labour, material, overhead, and profit. Apple stretched its accounts payable to $90$ days or more. ${?}^{43}$

Apple's strategy was to secure capacity from suppliers in advance, as part of negotiations during the sourcing process. The procurement team maintained ridged control of supplier margins, sometimes asking them to make investments in capacity and specialized equipment. ${?}^{44}$ Where necessary, however, Apple was prepared to make prepayments to suppliers to ensure the supply of components as part of long$-$term supply agreements. In addition, the company also invested in manufacturing process equipment for some suppliers to expand capacity, implement new technologies, reduce costs, or improve quality. ${?}^{45}$

In September $2019,$ Apple announced that it awarded $$250$ million to Corning Incorporated $($Corning$)$ from its Advanced Manufacturing Fund to support the development of precision glass for iPhones, Apple Watches, and iPads. The investment was in addition to the $$200$ million Corning had received in $2017$ from Apple. Apple had committed to invest $$5$ billion through its Advanced Manufacturing Fund to support innovation and job creation in US technology businesses. Other investments included $$390$ million to optical components supplier Finisar Corporation to support the increased production of laser chips. ${?}^{46}$

Sales forecasts provided suppliers with planned production volumes prior to product introductions, but Apple reacted to changes in demand by altering orders, sometimes with little warning. ${?}^{47}$ Apple did not guarantee minimum order quantities if sales failed to materialize but expected suppliers to have the capability to ramp up production as needed. It was critical to have a sufficient number of iPhones available to meet demand during the weeks immediately following product release, when consumer interest and demand was highest $($see Exhibit $5).$ For example, Hon Hai Precision Industry Co$.$ Ltd$.,$ better known as Foxconn Technology Group $($Foxconn$),$ increased employment at its Zhengzhou factory from a base of about $100,000$ to as many as $300,000$ workers during the peak production season, between August and December. Production staff worked $12-$hour shifts, six days per week during this period, increasing output to about four times the normal rate. ${?}^{48}$