Marketing and Home Depot

Topics: Marketing, Strategic management, SWOT analysis Pages: 2 (376 words) Published: February 17, 2013
SWOT analysis
Strength:
1. Being the industry leader , it has enough capital and resources to spread its business 2. Improving the core stores by diversifying services, new channels and move upstream and to international markets. 3. Developing a wholesale builder supply business and home service business 4. Cutting labor costs by doubling the number of part-time workers Weakness:

1. The large number of part-time workers can decrease the quality of products. Workers won’t work so hard. 2. Selling wholesale distribution channels makes it loss the wholesale customers. 3. The customer satisfaction decreased, because the store is not that modern 4. The huge debt ratio from 10% to 47%

Opportunity:
1. Acquiring the Chinese home-improvement retailer can help Home Depot spread its distribution and sell the products internationally 2. Borrowing money from outside can help develop business faster. Threats:

1. The attempt of entering home-services business is so aggressive, huge risk may involve. 2. The high stock price does not mean a good business strategy; it is because investors predict the company may increase. 3. Lowe’s, which is the biggest competitor of Home Depot continues to do well Recommendations based Strength and Opportunity:

Raising money and building new distribution channels and stores are effective methods to spread business. However, before develop new markets, researches should be analyzed carefully. If the new markets such as Mexico and China do not consumer the same type of goods as U.S does, changes should be made when developing new channels. In addition, cutting labor costs by increasing the part-time workers is not a long-term strategy. Part-time workers may not work as hard as full-time workers. This may increase the cost of buying back unqualified inventories. Suggestions based on Weakness and Threats:

As Home Depot’s major competitor, Lowe’s run well and has a higher customer...
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