Kingston

Kingston

Create an environmental scan for the company indicating the most significant environmental threats and discuss how the company should respond to each threat to ensure that the impact to the business is minimal.

Weaknesses

Intense competition

Kingston operates in a highly competitive and technologically evolving industry. The company faces competition from numerous manufacturers and marketers of memory products as well as from manufacturers of new and alternative technologies. Kingston competitors include STEC, MA Laboratories, Micron Technology, Intel, Dataram, SMART Modular Technologies, Panram International, SanDisk, Imation, Transcend, Memorex Products, ADATA Technology, Apacer Technology, Seagate Technology, SimpleTech, PNY Technologies, Amkor Technology, and Ramaxel Technology (Marketline, 2013). Some of these competitors are large corporations and have greater resources, including government support, to withstand downturns in markets. Intense competition may result in pricing pressures which may impact the company's revenue growth, market share and margins in coming years.

Response

Kingston should be able to scan the changes in the market rapidly and implement it accurately in the production. The company should be able to track down the consumer preferences regarding the memory products and should be able to inculcate in the production quickly without wasting any time.

Global economic slowdown

The global economy has slowed down in the last few years. According to industry estimates, the global economy is expected to remain weak and uncertain in 2013. The downturn in the euro zone is forecasted to continue till the end of 2013. Also, the US economic growth is expected to fall from2.1% in 2012 to 1.8% in 2013. Moreover, the overall, growth in developing and emerging economies is expected to decline from 5.5% in 2012 to 4.7% in 2013.Downside risks for this weaker global outlook are expected to further increase. The economic situation in the Euro Area will remain at decline until all the policies are implemented for corrections. Downside risks to growth in emerging market and developing economies are primarily related to external factors in the near term (Marketline, 2013). The economic slowdown in the emerging markets since mid-2011 has been the effect of tightening the fiscal and monetary policies in order to curb the economic outburst. Slowdown in the economy could further impact the spending by Kingston's customers around the world, which in turn could impact the demand for the company's products and services and dent its sales.

Response

Company should be investing in low end products and increase the marketing in order to induce the demand because economic slowdown will affect the revenues and company should be entering into future contracts

Technological changes

As a global manufacturer of memory products, Kingston is exposed to a high degree of technological changes. Technological innovation while driving the demand for new products burdens the company with obsolete products. As a result, the company has no other option, but to sell these obsolete products at a loss, provided demand still exists for them. Kingston may employ a number of strategies to reduce technological risk, but the rapid rate at which leading OEMs are innovating, exposes the Company to the inventory obsolescence ...