Type: Management
Pages: 3 | Words: 777
Reading Time: 4 Minutes

Home depot is a large retailer in America for home improvement and construction products and services. Home depot operates over two thousand large retail establishment which are part of its retail chain. It was formed basically to create a big home improvement warehouses which could serve a very large population. The home depot is a huge investment in assets as well as people who oversee all its operations in numerous retail units (The Home Depot, 2010).

It is a huge retail chain which involves several products for home improvement and it is well managed in terms global strategic management so as to achieve desired results. When a company is too large, it becomes increasingly challenging to monitor each operation and thus systems of strategic management should be utilized. The impression that I have about home depot is that it makes huge transactions and profits as well as involving a lot of people in all its chains (The Home Depot, 2010).

Strengths. These are the internal factors that favor continued progress of the Home Depot business strategies. The company is well managed and as a result gains strengths which make the business very competitive in the industry. These strengths make the company difficult to compete with in product and service delivery. These strengths range from a well known brand name, excellent business model, ability to grow and a wide range of products and services (The Home Depot, 2010).

The business model of Home Depot is unique and simple. It was basically developed to change ways in which customers shop for home improvement products. They have very large and spacious stores which enable them to stock several products and hire learned salesmen who are knowledgeable about home improvement products. The model has attracted customers from all levels ranging from professionals to those in the lower level due to its low priced model. Thus its business model has given it competitive advantage over other businesses and it stands to be its strength (The Home Depot, 2010).

The Home Depot has developed its name for quite sometime up to a point that it has been well known for home improvement products. Thus the brand name is known and it attracts the customers as compared to new establishments which are little known in the market. It earned this strength through its initiatives of focusing on the customer satisfaction. The brand name has also strengthened because of its wide presence, low price strategy, staff identity color and knowledgeable sales personnel (The Home Depot, 2010).

Also, Home Depot has variety of products and service that the company is able to offer. This makes it a one stop shop for many shoppers and as such it attracts and retains several clients. They offer all that is needed for home improvement and out of its known experience on quality products and services it becomes difficult to be ignored by any potential customer. Thus it has given it a hedge over those businesses which offer one line of business only (The Home Depot, 2010).

The other strength which has brought Home Depot to its present status is the ability to grow continuously. It has been able to meet all its expansion costs and increase its business base. This is because of good revenues generated which can be reinvested to further expansion and also financing support from financial institutions out of its known success. Thus the ability to grow has made it to surpass other players in the industry of home improvement to emerge very competitive (The Home Depot, 2010).

The other strength is the benefits of economies of scale out of the expanded operations. The business is able to negotiate good rates with its suppliers and as such get discounts out of their huge purchases. These have driven the costs of business down resulting in increased income for further business developments.

Weaknesses. These are internal factors that derail the business development agenda of the company. These weaknesses need to be addressed in any business in order to make any business to be successful. The Home Depot has weaknesses which significantly reduce its rate of growth. The most obvious is the diseconomies of scale. The company has grown steadily with its costs going up proportionally. It has reached a point where the company is not able to reap from its expanded operations and as such lead to reduced profits out of failure to utilize economies of scale (The Home Depot, 2010).

The other weakness is associated with expanded network which may increasingly become difficult to manage because of its lack of appropriate systems. Thus the company needs to improve its strategic management operations on a continuous basis so as to defeat this hindrance to further growth process.

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