SWOT ANALYSIS OF FOXCONN: [Essay Example], 876 words (2024)

Opportunities:

1. Expanding Channel Business: Foxconn’s aim is to fabricate its brand and attain the leading technology of its own. Foxconn has huge opportunity to expand its business as it has expertise in the technology sector. It can serve the healthcare sector by providing innovative healthcare products. Now a days, mobile and wireless devices are also working as healthcare materials. By using that technology Foxconn can easily capture the industry trend. In 2016 Foxconn bought majority of the stake of Sharp Corp. It has also bought the stake of Toshiba Corp.'s most profitable memory chip business.
2. Capture the emerging markets and products: People always look for new electronic merchandises, therefore increase demand of the latest merchandises. With the development of Asia and African market the merchandises from Foxconn can run into the demands of low monetary value and good quality which has advantage in busying the new market.
3. Increase Profits: Foxconn has a future plan to use around 1 million robots in its manufacturing process. As a leading technology innovator Foxconn has huge opportunity to increase its profits by deploying those robots in manufacturing. Those robots will replace human workers in job areas such as welding, spraying and assembling. These robots would be able to assemble around 30,000 devices within a timeframe that has not been disclosed. The engineering augmentation may assist Foxconn to reduce their cost of production when they started to use robot to produce equipment which may also help them to increase their efficiency as well as reducing cost of production.

Strengths:

Good Finances, Management Leadership and Execution

Place: Most of the Foxconn’s products are produced in China. China has huge expertise manpower. By using those manpower at a low cost Foxconn can assemble a huge amount of products.

Huge Production Capability: Foxconn has the capability to deliver large volume of ordered products at a competitive price, also can provide best quality products. As Foxconn has a large number of employees by whom they can manufacture huge volumes of products within a shortest possible time. This capability helped Foxconn to reach at the peak of success.

Strong Customer Reliability: Foxconn achieved customers reliability by providing latest technology items. In general, Foxconn is very much known to the people for making iPhones and other Apple devices but it has also huge number of renowned customers like Blackberry, Sony, Dell etc organizations..

Weakness:

1. Poor Working condition: Although Foxconn has good image to its customers for providing best quality products but there are some allegations of poor working conditions which was published in the newspapers. In china the allegation against its senior officers that they tries to discriminate against the communist workers , huge working hour.
2. Dependence on OEM Accounts and low Profit: Foxconn uses Traditional OEM which has high operating cost for which they can’t make huge profit. This electronics supply chain relationship with the power tilted towards the OEMs (such as Apple) is responsible for Foxconn’ low profit margin.
3. Employee Dissatisfaction: The employees are the heart of any business. Because of low wage and huge working hour the employees of Foxconn feel lack of motivation. After the work is done Foxconn employees can’t take that much rest because they have huge working hour. Because of different working hours, in the dormitory the workers with different jobs also the day and night shift workers get mixed for which workers frequently disrupt each others’ rest. Additionally, random dormitory assignments often disrupts existing networks of social relationship, communication and interaction between workers for which workers have forfeited their personal and social lives.

Threats:

1. Increasing labor cost: Increasing labor costs also harmed Foxconn’s capability to control their high-volume production at cheaper cost. Foxconn faced strong pressure to increase the employee wages after the suicide of an employee in the factory in 2009. Working conditions including low wage, long working hours and strict discipline came under the eye of the media people which has became a negative public relations issue for Foxconn.
2. Shortage of workers: Youth workers are the lifeline of any company and they are preferred in the service industry jobs .After China’s one child policy the number of youth workers has declined dramatically. In recent days Foxconn had to struggle with long-term shortages of workers in continuing its huge Chinese production line.
3. Increased Competition: In the past without having no other option Foxconn’s main customer Apple was solely dependent on Foxconn. But in this era of technology many advanced technology has come into the market for which Apple tries to diversify its production chain away from Foxconn. Foxconn’s monopoly on Apple orders is now declining day by day. Other competitors like Compal and Wistronare now getting orders from Apple too. Another large competitor of Foxconn, Pegatron with more than 100000 employee and Quanta are also receiving large amount of Apple’s orders. Among them Pegatron is continuously getting more iPhone and iPad orders. So, its becoming so difficult for Foxconn to run its operations in China.
4. Increasing demand Android OS devices: We all know that Foxconn invented the modern smart phone like IOS technology but in recent days Android went on to dominating power in the market because of numerous partnerships with carriers and low price also more flexibility than the IOS devices.

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