Nintendo Swot

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SWOT

Strengths

According to Datamonitor’s company profile on Nintendo, published on September 17, 2007, Nintendo has four main strengths: A strong brand name, high returns, high employee efficiency, and debt free status.

Nintendo’s strong brand name comes from about twenty-five years experience in the video gaming business. Not only do they have a strong presence in the console market but they are the leader in the handheld console market. They pioneered this market in 1989 with the original Game Boy. Since then, they have upgraded to create Game Boy Advanced and Nintendo DS, which sold 79.5 million units and 40.3 million units, respectively, in fiscal 2007. The Nintendo Wii, which is their most updated console, sold 5.84 million units in the first five months in its launch alone. This system consists of motion sensors attached to the end of the controllers as well as the console, which makes the games more interactive. A high percentage of the people that play video games in today’s day are college students.

Nintendo has also been very successful in investing their resources in profitable companies and ideas. This would include their ownership in the Seattle Mariners and the Atlanta Hawks. It also refers to their high return on assets and equity when compared with other companies in the same industry.

Nintendo also has high employee efficiency. According to Datamonitor, “revenue per employee was about $206,960 in fiscal year 2007, significantly higher compared to the industry average of about $3,684 during the same period.”

Nintendo’s biggest strength in my opinion is their ability to stay debt free. Their most recent debt to equity ratio was zero compared to the industry’s average of 11.9%. This not only shows that they are able to efficiently finance its’ operations but also enjoys a lot of financial flexibility.

Weaknesses

Nintendo’s two biggest weaknesses are having a dependence on contract manufacturers as well as...
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