1 Company profile Hewlett Packard (HP) is an American company founded in 1939 by Bill Hewlett and Dave Packard. It is one of the world’s largest IT Company and it operates in more than 170 countries. It provides a large range of hardware components as well as software and related services to individuals, small-to medium sized businesses and large companies. HP’s product line includes personal computing devices, enterprise servers, related storage devices and a diverse range of printers and imaging products. HP’s service portfolio includes technology service, consulting service, support service and enterprise service. HP markets its products to its customers directly as well as via online distribution. 2 Porter’s competitive forces model …show more content…
Hence, there is a high barrier to entry into the technology industry. 2.3 Substitute products The PC and printers are one of the highly used items by consumers. However, PC sales have been declining due to consumers using their mobile phones or tablets. It will continue to decline unless HP develops a sustainable solution to produce successful mobile phones or tablets. 2.4 Bargaining power of customers Customers have moderate bargaining power mainly because there are many buyers and not one particular buyer is dominant enough to directly influence HP’s profit margin. Another reason why is because, customers knows that if they demand more customization and features for the product, HP or its competitors will be able to meet their demand in order to increase their profit. 2.5 Supplier HP’s suppliers have a high level of bargaining power mainly because of the type of industry it is in. HP is in the electronics industry. A PC or a printer is made up different components, some of which are sold by large reliable suppliers while some are sold by specified manufacturers. HP has over 50 suppliers for its manufacturing. This is good for HP as it has greater control over suppliers in terms of price, quality and delivery schedules. 3 HP’s objectives and goals HP’s main objective is to have customer loyalty, achieve sufficient profit,
Bargaining Power of Suppliers: The bargaining power of suppliers in the industry is low. There are numerous suppliers in this industry, and the large department stores have the ability to negotiate for the lowest prices. In addition, the switching costs are low, as the products are not highly differentiated. There are a large volume of purchases in the industry, allowing the department stores to exert even more power over the suppliers.
Bargaining power of buyers is medium-high because of the low switching costs and wider spectrum of similar products selling at competitive prices due to the influence of developing countries
Hewlett Packard (HP) decided to produce 1.3-inch disk drives to become the market leader in a new market and increase HP’s revenue. Although the market for 1.3-inch disk drives was still unclear and still developing, HP decided to organize a special team to develop this new product. This group was multi-talented, with the best engineers from every department in the company. The group also had many priorities for the company. However, things didn’t develop as the Kittyhawk team expected. They failed to sell the new product to the customer they planned. Even though some new customers were interested in this
Bargaining power of supplier: High levels of competition among suppliers act to reduce prices to producers. This is a positive for Ford Motor Company. Standardization of parts allowed Ford to reduce dependency on fixed supplier/vendor which goes into producer’s favor.
This assignment is based on the declining consumer appeal to PC in US. Due to technological advancement; PCs are replaced by tablets and Smartphone. This assignment includes all the factors such as political, legal, social, technological, etc. that leads to the declining consumer appeal to PCs. The current target demographics are also discussed along with the recommendations given to the marketer. China is selected as a country for marketing PCs via using effective positioning strategies.
Bargaining Power of Suppliers: A producing industry requires raw materials - labour, components, and other supplies. This requirement leads to buyer-supplier relationships between the industry and the firms that provide it the raw materials used to create products. Suppliers, if powerful, can exert an influence on the producing industry, such as selling raw materials at a high price to capture some of the industry's profits. Tesco maintains direct professional business relationships with all their suppliers of organic food and non-food product worldwide. They also conduct supplier viewpoint surveys to find out what their suppliers think of Tesco.
The bargaining power of customers determines how much customers can impose pressure on margins and volumes.
Hewlett-Packard: Develops, assembles, and sells computer hardware and printers. The firm outsources many of its computer and printer components.
Hewlett-Packard Enterprise will concentrate on selling hardware like servers to businesses wanting to build up their data centers while HP Inc. will sell printers and personal computers (Vanian, 2015). This strategy effectively modernizes the scale and scope of the services and systems HP currently offers to its enterprise customers.
Bargaining power of buyers: Businesses and individuals all fall under the customer's category for this industry. Big customers do get volume discounts and can negotiate prices with sales representatives. However smaller customers have to take what is being offered to them. The only say they have is that they can switch between the players, but due to intense competition, the prices offered are generally the same across the service band.
The bargaining power of buyers stands in a direct relationship with the bargaining power of suppliers. If the bargaining power of buyers is substantial it increases the opportunity cost of suppliers. The greater the buyers concentration the greater their bargaining power. This bargaining power is also increased in markets where the suppliers’ concentration is high. The bargaining power is also increased when the cost of switching from one supplier to another is low. In instances where backward vertical integration is possible i.e. buyers setting up their own chains of suppliers the bargaining power of the buyer increases in that their prices may become more competitive. In a market where the buyers are more concerned over quality than price their bargaining power decreases as they are less inclined to shop
Bargaining power of suppliers. Suppliers have the ability to leverage, control, and negotiate the cost of their products (Hill et al., 2015, p. 56). In the case of the suppliers of the office supplies industry, more so for Staples, the bargaining power is weak and is considered to be low. The reason for its power being weak is a result of large companies having several suppliers that will easily compete against each other to provide the lowest cost of products.
Customer’s bargaining power: The bargaining power of customers is medium. There a huge number of customers, not well organized to defend their interests. Additionally, the
HP is one of the few companies in the world to successfully marry the technologies of measurement, computing and communication. The company makes new advances in portable computing, enters the home-computing market and continues to invent new printing and imaging solutions. For most of the decade, HP enjoys growth rates of 20 percent.
The best strategy to resolve the problem of “What strategies that Hewlett-Packard Company should adopt to explore the Vietnam market” is joint venture with local distribute. The Hp Company doesn’t know with the environment there so through the Joint-venture, the company can more