SWOT analysis weaknesses for creative technology ltd

SWOT analysis (weaknesses) for creative technology ltd

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       Investing highly in research and development- for instance, during the year they employed a lot of resources in research and development in the products that they take to be strategic to their business. Particularly, they placed a lot of focus on the audio technology which born the sound blaster brand with the applications of the technology into the family of the sound blasters. Although this brought forth to the family ultra high performance sound cards, intelligent and innovative wireless systems and the best gaming headsets, the company had invested so much on its research and development.

       Short lifecycle of the products: creative technology’s key mistake has been on the shorter products lifecycle. Due to this, the company is not at a position of enjoying advantages of enormous sales of one commodity before it instigates a new product. This could be their strategy to militate against the increased competition, but at last it ends up being a disadvantage to the company.

       Little returns are another weakness of creative technology ltd Company. The company has recorded frail returns on assets and also on the capital invested in current years which are lesser than the manufacturing average. This has led to demoralization of the company’s shareholder and the company’s development plans. This has mostly been promoted by the competition in the market where the company mostly is not able to produce products that are in line with the most advanced companies in the market.

       The company also may face an increased gross profit with increasing operating cost. This impact negatively to the company as they enjoy the profits not realizing the increased cost of operation leading to lower net profits.

Creative revenues in 2013

       The 2013 fiscal year sales were US$165 million reflecting a reduction of 14% as compared to US$192 million for the 2012 fiscal year. Gross profit as a ratio of sales was 33% in fiscal year 2013, from 19% in the previous fiscal year. Net profit for fiscal year 2013 was US$17 million, as compared to a US$84 million net loss in fiscal 2012.

       The net results for in fiscal year 2013 included other gains of US$28 million, mainly a US$27 million gain on the subsidiary divestment.

       For the categories of headsets and earphones, there were not only the additions of new models to the premium ones of Aurvana series but also the creation of the trendy creative Hits series. These Auvena platinum and gold were previewed in Berlin at IFA show of 2013. They are fitted with a dazzling groundbreaking technological features like the entire new share-me technology that allows listeners of share- me enabled headsets to link the headsets wirelessly and share the audio simultaneously.


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