Huawei SWOT Analysis 2022

Huawei SWOT Analysis 2022

Huawei is a global technology brand that is headquartered in China. The company began its journey in 1987 in Shenzhen (the headquarters city of the company). 

The products Huawei produces include electronic, telecom devices for networking, smartphones smart TV, mobile devices tablets, multimedia technology, laptops, computers Harmony OS, dongles, and networks for broadband.

The year-end profits of the company were over 100 billion US dollars. This means that is Huawei one of the fastest-growing electronic manufacturing firms in today’s 21st century. 

However, that doesn’t mean Huawei is the only manufacturer of a savvy company around the globe. 

Manufacturing mobile phones is a very competitive field and Huawei is competing successfully with other companies in this market. Here is the is Pestle Analysis of Huawei.

Huawei SWOT Analysis

In the beginning, the main company’s primary focus Huawei Company was on manufacturing components and switches for smartphones. 

In time the company changed its attention to other activities including providing consulting equipment and services to other companies as well as developing telecom networks.

According to estimates, Huawei connects roughly 3 billion people across the world. The goal of this company is to promote the advantages of technological advancement to all. 

The company is on a digital plan to fulfill its purpose. The primary areas of concentration are technological, skill, and application.

Today, we’ll talk about our SWOT study of Huawei and the following is what follows;

Company Background

Name Huawei Technologies
Industry Telecommunications and smart devices
Founded 1987
Headquarters Shenzhen, China
CEO Ren Zhengfei
Revenue $138.30 Billion (2020)
Profit $10.02 Billion (2020)
Competitors Ericsson, Nokia, Samsung, Lenovo, Apple, Xiaomi, Sony, HTC

Strengths In The SWOT Analysis Of Huawei

Huawei SWOT Analysis

  •  Large Product Portfolio: One of the major strengths of the company is its broad range of products range. Huawei is experiencing the fastest growth in its wide selection of smartphones. Huawei is among the top three brands in smartphone production and is among the top two brands in the global market for smartphones. Every year, the quantity of smartphones sold keeps growing. Since the company has a more popular smartphone each year, it shows in the higher profit. In addition to smartphones, the brand produces numerous other products, including fixed and mobile broadband networks tablets and dongles for multimedia, Harmony OS, and Smart TV. All of its products and services are designed for businesses and individual customers as well. Huawei’s entire operation is split into three distinct segments. These comprise enterprise business, consumer, and carrier.
  • Innovation in Technology: Another advantage that the company has is innovativeness in technology. Since its inception, the business has maintained an emphasis on research and innovation. Each year, the brand invests significant funds in the field of research and creation. Every year, the quantity is increasing, and consequently, the latest technologies are coming out of the Huawei brand. Because of its focus on research and innovation, Huawei is a prominent company in the world of smartphones and 5G technology too. Additionally, the company invests an enormous amount of money in Artificial Intelligence technology and expects an increase in expansion. Because there’s always some sort of advancement in technology, the company believes that it will grow faster within the international marketplace.
  • Leading Position in the Smartphone Market: Being a leader in the world of smartphones, Huawei produces and sells numerous handsets to the market. It is the company’s primary source of revenue. The number of smartphones sold by the brand is increasing which means that the revenues are growing as well. Huawei ranks as the 2nd biggest manufacturer of smartphones just behind Apple. In the year 2018, the company’s smartphone sales turn around two million. While the smartphones of Huawei are equipped with cutting-edge technology and top-quality cameras, their cost is affordable and because of this, the company’s market share has risen to the highest level.
  •  International Presence: The brand has a strong global reach and this is a major advantage that the name has. Through the years the company has grown across the globe, resulting in high income, market share, and an impressive customer base. As a Chinese company, Huawei has business operations across more than 170 countries. It also has a wide network of suppliers, distributors, along with business and commercial partners in all areas of the world.
  • Competitive Pricing: Another advantage that the company has is the brand’s affordable pricing. This is the main reason behind the brand’s ability to gain popularity and grow quicker. The brand follows a well-planned plan that is focused on lower prices and high quality. It has also led to being able to capture a substantial market share of the global smartphone market which has led to an increase in revenue. The company offers a variety of products that are priced affordably and will appeal to all different economic categories of consumers.
  • Customer Value: Huawei has partnerships with a variety of associations to provide solutions for network and networking that are simple, efficient ingenious, reliable, and safe. The brand also offers ICT capabilities for corporate customers and provides them with a variety of solutions that are safe reliable, innovative, and safe. The brand utilizes numerous innovations within its smart devices to enhance the user experience on the internet.
  •  Secure and Stable Network Operations: The most important priority of the brand was always centered around security and privacy. Huawei believes in the value of transparency and honesty. Huawei is constantly determined to improve its capabilities in software engineering and business continuity, while also expanding the number of networks. Huawei has been working for more than 30 years with customers of carriers to build over 1500 networks across more than 170 countries. In a structured manner, it has attempted to connect around three billion people around the globe. Even with this massive network, the brand aims to ensure that it is on the right path to security.

Weaknesses In The SWOT Analysis Of Huawei

Huawei SWOT Analysis

  • Many Controversies: The brand has faced numerous controversies since its inception that could be an enormous weakness in the name. Huawei also has a negative image on the international market. Beyond the controversy over spying, there are many others who have tainted Huawei’s image across many Western nations, but mostly within the US. It is because of the fierce tensions between the US and China and the close ties to China’s Chinese administration and Huawei. In the present, Huawei’s image is seen as a huge negative for the brand. Additionally, the company has been accused of making use of its resources for the purpose of espionage. Because it lost AT&T service in the US the brand is now losing support from other US partners too.
  • Weak Market in the US: The largest phone market within the US and Huawei is not doing effectively on its position in the US market. This is a huge problem for the brand because the US is the largest smartphone market and Huawei is unable to compete. People living in the US generally avoid buying Huawei phones. Although the company has been subject to probes on a number of problems across various countries like the US, Canada, and Britain however, the brand doesn’t seem to be popular in these countries. As time passes Huawei’s standing within the US market continues to decline across its home market of the United States. Furthermore, it is believed that also, the US government is very keen on keeping the brand from being allowed to grow within the US market.
  •  Lack of Capital: Huawei always has an insufficient cash flow. In comparison to other top brands around the world, Huawei’s capital is lower. Huawei is able to use very little capital for its business. Therefore, they must be extremely cautious when designing business activities. Due to the lack of funds the company has very little to spend on marketing and marketing. To ensure that the brand is accessible it must spend a significant amount on marketing and branding. This is a major flaw in the branding.
  • Weak Brand: Since Huawei has the least capital, it doesn’t have a strong image of its brand. There is no marketing of the name and as a result, it’s an unreliable brand. Although the brand is able to project an excellent image in a handful of countries, it is lower popularity in the major countries. As a brand that is weak because it impacts the brand’s image, it is an enormous weakness of the company.

Opportunities In The SWOT Analysis Of Huawei

Huawei SWOT Analysis

  • AI and 5G Technologies: Huawei has discovered a variety of opportunities through the research and development it has conducted. As a major player in the mobile industry and also experienced a huge advantage in the field of 5G technology. The company should concentrate more on AI and 5G tech and has had great success with 5G technology. Both techniques AI and 5G can be profitable can be used by any smartphone company. The company also is looking for opportunities to expand its involvement in these kinds of technologies.
  • Marketing: Although Huawei is a strong tech company the company’s marketing method is less successful in comparison to its competitors. Instead of using the use of a marketing strategy and consistent branding, the company relies heavily on the company’s price strategies and the quality of its products to grow its customers as well as market share. As a top brand in the field of technology, it should have a solid marketing strategy and is crucial to its business plan. It should concentrate more on the marketing strategy to create an image that is more positive for the brand.
  • Retail Chain: In the international arena, Huawei utilizes the internet as one of its channels for sales. At present, Huawei has created a strong position and is looking for more opportunities to increase its reach on the international market by putting in initiatives to build its brand retail chain. Alongside marketing as well, the company must be able to drive sales and build customers’ loyalty.

Threats In The SWOT Analysis Of Huawei

Huawei SWOT Analysis

  • Competitors: The smartphone market has faced many competitors in the past and is growing rapidly. Since the company is acknowledged as an industry leader in the field of smartphones, however, it is also facing rivals from various international brands as well as Chinese brands too. Its competitors include Apple, Xiaomi, Samsung, etc. So, having a lot of competitors in the smartphone market can pose a major risk for Samsung.
  • Regulatory Pressures: Numerous political and regulatory pressures are now posing an imminent threat to tech companies around the world. Huawei’s international business Huawei is under threat by the pressures from the political and trade war among China as well as the US. It’s not just with the US that Huawei faces challenges, but also with other major markets such as Canada, Britain, and Japan. Huawei is subject to intense pressure from political leaders and this poses a major risk to its growth. This could severely limit the international business activities of Huawei.
  •  Trade Pressures: There have been always trade disputes in the past between China as well as the US This is a major problem for the company’s brand. This is because of the relationships that the tech company has with its Chinese government. It is also a threat for the business.

Limitations of SWOT Analysis for Huawei

While it is true that the SWOT analysis is extensively used as a tool for strategic planning, however, it does have its fair share of drawbacks.

  • Certain aspects or capabilities of an organization could be both a strength as well as a weakness at the same time. This is among the most important limitations that SWOT analysis has. For instance, changing environmental regulations can be damaging to the business however it could also be an opportunity in the sense that it allows companies to be on the same level or even gain an advantage over competitors if they are could develop their product quicker than competitors.
  • SWOT doesn’t provide a way to get a competitive edge and therefore it shouldn’t be considered a solution in and of itself.
  • The matrix is merely an idea to begin an analysis of how the proposed strategies might be implemented. It offered an evaluation time frame, but it did not provide a plan of implementation that is based on the strategic competitiveness of Huawei
  • The SWOT model is a static analysis that analyzes the current conditions with only a few potential modifications. When circumstances, capabilities, as well as threats and strategies, evolve, the dynamic of the competitive landscape cannot be analyzed through a single matrix.
  • SWOT analysis can lead firms to emphasize one external or internal element in formulating strategies. There are interrelations between the important external and internal aspects that SWOT cannot reveal that can be vital in formulating strategies.

Weighted SWOT Analysis of Huawei

Due to the previously identified weaknesses of the SWOT analysis/ matrix, the management of corporations has decided to assign an appropriate amount of weightage for every internal strength and weakness of the company. 

Companies also evaluate the probability of events happening in the near future and what the effect will be on the company’s performance.

This technique is known as the Weighted SWOT analysis. It’s better than basic SWOT analysis as using weighted SWOT analysis Huawei managers can concentrate on the most important elements and ignore the less crucial ones. 

It also eliminates the problem of a long list that causes organizations to make an extensive list, but none of the elements are considered to be crucial.

Final Thoughts

Huawei has done a fantastic job of navigating one of the most difficult markets in smartphones. market. 

With affordable, top-quality products It shouldn’t be hard for Huawei to prosper even in the most challenging conditions. 

Furthermore, Huawei has a significant opportunity to expand its business by gaining a foothold in new markets (including technologies like 5G, as well as geographical ones like India and in the US) and enhancing its perception of its brand, perhaps using brick and mortar retailers. 

In the meantime, Huawei needs to be aware of its competitors and make sure it has plans to handle the increasing material and labor costs.

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