SWOT Analysis Of NETGEAR analyzes, NETGEAR is a global networking company that delivers innovative products to consumers, businesses and service providers. The Company’s products are built on a variety of proven technologies such as wireless (Wi-Fi and LTE), Ethernet and powerline, with a focus on reliability and ease-of-use. The product line consists of wired and wireless devices that enable networking, broadband access and network connectivity. These products are available in multiple configurations to address the needs of the end-users in each geographic region in which the Company’s products are sold. NETGEAR products are sold in approximately 28,000 retail locations around the globe, and through approximately 27,000 value-added resellers, as well as multiple major cable, mobile and wireline service providers around the world.
Did you know?
NETGEAR was first to introduce SMB Wi-Fi 6 access points and mesh systems, which is 40% faster than the previous Wi-Fi standard Wi-Fi 5 and provides four times more coverage for high-density deployments.
NETGEAR was founded by Patrick Lo in 1996. Prior to founding NETGEAR, Lo was a manager at Hewlett-Packard. NETGEAR received initial funding from Bay Networks. The company was listed on the NASDAQ stock exchange in 2003. The company markets and sells its products through traditional retailers, online retailers, wholesale distributors, direct market resellers, value-added resellers, and broadband service providers in the Americas, Europe, the Middle-East, Africa, and the Asia Pacific.
This can only be achieved through a firm with extensive knowledge, experience, and innovative strategies. To determine the strengths of the company potential, weaknesses, opportunities, and threats, it is necessary to conduct a SWOT analysis by NETGEAR.
NETGEAR At A Glance – NETGEAR SWOT Analysis
Company: Bay Networks, Inc.
Founders: Patrick Lo
Year of establishment: January 8, 1996
CEO: Patrick Lo
Headquarters: San Jose, California, United States
Employees (Dec 2020): 2200
Ticker Symbol: NTGR
Annual Revenue (Dec 2020): US$1.26 Billion
Profit net income (Dec 2020):US$367.1 Million
Products & Services: Routers | DSL/Cable | Gateways | Switches | Wireless Access Points | Network Attached Storage | Surveillance IP cameras
Company Website: www.netgear.com
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NETGEAR SWOT Analysis – SWOT Analysis Of NETGEAR
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NETGEAR Strengths – NETGEAR SWOT Analysis
- Automating processes has ensured consistency in the quality of NETGEAR, Inc. products and enabled the company to expand and scale down depending on the demands of the market.
- Reliable suppliers It has a solid foundation of reliable suppliers of raw materials, allowing the company to get around any bottlenecks in the supply chain.
- Excellent performance In New Markets – NETGEAR, Inc. has developed the ability to enter new markets and making a success of these markets. This expansion has enabled the company create a new revenue streams and diversify risks of the economy in the markets it is operating in.
- A strong dealer community has developed a culture among dealers and distributors where dealers don’t just market the their products, but also invest in educating sales staff to show the client how they can get the maximum benefit from the product.
- Solid Brand Portfolio Through the years, NETGEAR, Inc. has invested in building a robust brand portfolio. An analysis using SWOT for NETGEAR, Inc. just highlights this fact. The brand portfolio is extremely beneficial when the business intends to enter different product lines.
- Excellent Returns on Capital expenditure The company has a good return on capital expenditure NETGEAR, Inc. is quite successful in the execution of new initiatives and has earned excellent returns on capital investment by creating additional revenue sources.
- Solid Free Cash flow NETGEAR, Inc. has solid free cash flows which provide the hands of the business to develop new ventures.
- A high level of satisfaction with customers The company through its dedicated department for managing customer relations has been able to reach an extremely high level of satisfaction with its current customers as well as an excellent brand image among prospective customers.
NETGEAR Weaknesses – NETGEAR SWOT Analysis
- Financial planning is not executed effectively and efficiently. The current ratio of asset to ratio of liquid assets suggest that the business can make use of the cash more effectively than what it is currently.
- The organizational structure can only be suitable for the current business model, thereby limiting expansion of adjacent product categories.
- The way in which the product was promoted left many things to be wanted. While the product is successful in terms of sales, its positioning and distinctive selling proposition are not well-defined, which could lead to attacks in this sector from rivals.
- A high rate of attrition in the workforce – compared to other companies in the sector NETGEAR Inc. has more attrition rates and has to invest significantly more than its competitors in developing and training its employees.
- The inventory of days is higher compared to other companies – requiring the company seek out more capital to invest into the channel. This could influence the long-term expansion for NETGEAR, Inc.
- It is not very successful in the integration of firms with different culture. Like we said earlier, although NETGEAR, Inc. is adept at integrating small businesses, there is a fair amount of failures when it comes to merging companies with a different work style.
- The company has had limited success outside of its core business . NETGEAR, Inc. is one of the most prominent companies in its field, it has had difficulties in moving to different product lines within its current business model.
NETGEAR Opportunities – NETGEAR SWOT Analysis
- The new technology gives an opportunity for NETGEAR, Inc. to utilize a different pricing strategies in the current market. It will help the company to retain its loyal customers by providing excellent service and attract new customers with other attractive propositions.
- The company’s core competencies could be successful in different product fields. An example of this could be the case of GE research in healthcare has helped in the development of better Oil drilling equipment.
- A new environmental policy – The opportunities will provide an even play field that is open to all players in the field. This is a fantastic possibility that will allow NETGEAR, Inc. to increase its competitive advantage through technological advancement and to gain shares in the newly developed category of products.
- New customers are coming from the online channels – In the last few years, the company has invested huge amounts of money in its online platform. This investment has led to the opening of a new sales channels that is owned by NETGEAR, Inc.. Over the next few years the company will be able to capitalize on this opportunity by understanding the needs of its customers better and meeting their needs through large data analysis.
- A rise in economic activity and an more spending by customers, following years of recession and slow growth in the sector, presents the perfect opportunity for NETGEAR, Inc. to gain new customers and expand the market shares of its products.
- The latest trends in consumer’s behavior could open up a new markets for NETGEAR, Inc. . This presents a fantastic chance for the company to develop new income streams and expand into different product lines as well.
- Lower inflation rates – A low inflation rate will bring stability to the market, allow credit with a lower interest rate for clients from NETGEAR, Inc..
- The steady flow of free cash gives the opportunity to invest in other product segments. When there’s more money at the bank the company is able to invest in the latest technologies, as well as new product categories. This will open up a door of potential to NETGEAR, Inc. in other product segments.
NETGEAR Threats – NETGEAR SWOT Analysis
- A lack of regular supply of novel products. Over the years, the company has created a variety of items, however they are typically a in response to developments by other companies. The supply of new products isn’t regularly occurring, which results in large and low fluctuations in number of sales over a period of time.
- New environmental regulations in the Paris accord (2016) could pose the threat to some existing product categories .
- The company could be sued in a variety of markets, due to various laws and constant changes regarding the quality of products sold in those markets.
- The laws governing liability in different countries differ as well NETGEAR, Inc. may be subject to different liability claims due to changes in the policies of those markets.
- The latest technologies developed by the market disruptor or competitor could pose a major risk to the industry in the near to medium-term future.
- Stable profitability – Intense competition has added more players in the market over the past two years, which has resulted in a downward pressure not just on profit but also on sales overall.
- The rising cost of raw materials could be danger to NETGEAR, Inc. profitability.
- Because the company operates across multiple countries, it is susceptible to fluctuations in currency, especially due to the unstable political climate in a various markets across the globe.
NETGEAR SWOT Analysis Overview Template
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