Xerox Corporation, located in Norwalk, Connecticut, pioneered the worldwide Document Technology market and continues to lead it.
It also engages in service-related activities such as business processing and IT outsourcing. Xerox has recently experienced stiff competition from the likes of HP and Canon and has suffered revenue losses as a result.
The Xerox Corporation is one of the most successful businesses in its field. The SWOT analysis helps the company to maintain its position in the market. SWOT analysis is a dynamic process that proves to be a bridge that allows the collaboration of different departments of the company. It necessitates the bond between departments like finance, marketing, and others.
This article will help you review the SWOT analysis of Xerox Corporation. The SWOT analysis of Xerox will brief you on the position of the company in the market.
Xerox Corporation SWOT Analysis
The SWOT analysis is done on the basis of two aspects of the company, Internal Strategic, and External Strategic aspects. The result that comes out is known as the SWOT matrix. On the basis of this SWOT analysis, the managers of the company plan the strategies. There can be four different strategies that include:
- Strengths- Opportunities Strategies
- Weaknesses- Opportunities Strategies
- Strengths- Threats Strategies
- Weaknesses- Threats Strategies
Let’s have a look at the Internal Strategic Aspects of the Company and understand how they play an important role in the SWOT Analysis of Xerox Corporation.
Internal Strategic Aspects
Internal Strategic aspects consist of two aspects which include the strengths, and weaknesses of the company. These aspects help the company to understand where it is lacking from its competitors and areas to work on.
Strengths of Xerox Corporation
Xerox pioneered the managed print services (MPS) market and has remained the market leader ever since. Because of its strong market position, Xerox can maintain operational strength while its bottom line and cash flow improve.
- One of the biggest Strengths of Xerox Corporation is its diverse product portfolio in the Document Technology market. It continues to add new products and services to its portfolio, giving it a competitive advantage. Because of its market leadership in document technology, Xerox has been able to increase its investment in its business process outsourcing and information technology outsourcing businesses.
- The 2nd biggest strengths of Xerox Corporation is that it generates revenue by an annuity model, which generates recurrent cash flow for the corporation. Annuity-based revenue accounts for over 85% of the company’s revenue, ensuring the company’s stability and cash flow.
- Xerox has been dubbed “the copying and print company,” demonstrating how the company has dominated the market and developed a strong brand identity and recall.
- Xerox’s focus on R&D and innovation to upgrade and strengthen its present product line and broaden the applications of its products is a major cause for the company’s continued market leadership.
- Automation of activities improved the quality of Xerox Corporation products and allowed the corporation to scale up and down in response to market demand.
- Product innovation is a successful track record of developing new products.
- Xerox Corporation has a good track record of completing new projects and generating good returns on capital investment by establishing new revenue streams.
- The last of the Strengths of Xerox Corporation is that it has developed a dependable distribution network that can cover the majority of its prospective market over time.
This concludes the section on the strengths of Xerox Corporation
Weakness of Xerox Corporation
The mature markets of the United States and Europe provide for the majority of Xerox’s income. The company’s high reliance on specific markets exposes it to market instability in terms of political and economic factors.
- One of the biggest weakness of Xerox corporation is that its sales have been declining in recent years as a result of increased competition, particularly in the Document Technology industry.
- The second biggest weakness of Xerox corporation is that the current asset ratio and liquid asset ratios show that the company may be making greater use of its cash than it is right now.
- Days inventory is high in comparison to competitors, causing the corporation to obtain more funds to invest in the channel. This could have a long-term influence on Xerox Corporation’s growth.
- The last weakness of Xerox corporation is that its Expansion into adjacent product categories is limited due to the organization’s structure being only consistent with the current company plan.
This concludes the section on the weakness of Xerox corporation
External Strategic Factors
Now, as you have seen the internal factors affecting the company in both positive and negative ways, let’s understand the external aspects. The external Strategic aspects consist of two factors which are opportunities and threats to the company in the market.
Opportunities for Xerox Corporation
The global printing business has exploded in recent years, and it is expected to grow at a CAGR of 7% over the next three years. The company’s digital portfolio is well-positioned to profit from the increasing digital printing market.
- The first in the list of Opportunities for Xerox Corporation is the managed print services market is predicted to increase at a CAGR of 14.8% until 2024, with demand dominated by the North American industry. Xerox, which has a significant presence in North America, should gain from the market’s expansion.
- 2nd Opportunities for Xerox Corporation – Xerox Corporation has been given the opportunity to join a new emerging market as a result of the adoption of a new technology standard and a government free trade agreement.
- As the market develops, rival advantages will fade, allowing Xerox Corporation to strengthen its competitiveness in comparison to its competitors.
- In similar other product fields, an organization’s core skills might be a success.
- In the recent past, Xerox has strategically planned its acquisitions in order to expand regionally and eliminate competition. For example, Xerox purchased Ventiv Patient Access Solutions Health Company to broaden its pharmacy solutions portfolio.
- Reduced transportation costs as a result of decreased shipping costs can cut the cost of Xerox Corporation’s products, giving the corporation the option of either increasing profitability or passing on the savings to customers to win market share.
- The last in the list of Opportunities for Xerox Corporation is the new changes will level the playing arena for all industry participants. It is an excellent chance for Xerox Corporation to demonstrate its technological leadership and acquire market dominance in a new product category.
This concludes the section on Opportunities for Xerox Corporation.
Threats for Xerox Corporation
The last section in SWOT analysis of Xerox Corportation is understanding the threats for the company. The adoption of paperless workflows is putting a strain on document technology. With the introduction of smartphones and mobile devices, the emphasis on establishing paperless processes has expanded, posing a threat to the document technology business.
- One of the first threats for Xerox Corporation is the market in which Xerox competes is primarily driven by technology improvements, there is a lot of competition. In the services category, Xerox competes with TeleTech, IBM, and Genpact, among others, while in the Document Technology segment, it competes with Canon, and JP, among others. Pricing pressures arise as a result of intense competition, and profitability suffers as a result.
- 2nd in the list of threats for Xerox corporation is the demand for highly profitable products is seasonal, and any unforeseen event during the peak season could have a short- to medium-term impact on the company’s profitability.
- Counterfeit and low-quality product imitation is also a challenge to Xerox Corporation’s goods, particularly in emerging and low-income regions.
- The last point in the list of Threats for Xerox Corporation is Local distributors’ growing power poses a challenge in some sectors, as the competition pays local distributors better margins.
This concludes the section on Threats for Xerox Corporation.
This concludes the article on the SWOT analysis of Xerox Corporation.
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