Previously we looked at the elaborated marketing strategy of Sify Technologies, India’s leading ICT Service & Solution Provider. Now, let us hop over and look at the elaborated SWOT Analysis of Redington India.
Redington is one of the leading supply chain solutions providers for global brands of IT hardware and peripherals. The distribution ecosystem of Information Technology products has played a significant role in acquiring technology and its products with easy accessibility to all Indian consumers.
Another aspect that made Redington a leading supply chain solutions provider, is its marketing strategy. As the world goes online, Marketing is also evolving into digitalization. If you want to keep up to date check out our Free Masterclass on Digital Marketing 101 by the CEO and the founder of IIDE, Karan Shah.
Do you want to learn how Redington became the leading company in logistics services? In this blog, we will see the SWOT Analysis of Redington and discover the answer. Before we begin, let’s study more about Redington the company, its founding, products, and competitors.
About Redington India
Redington India was incorporated in 1961 with its primary focus on functioning as the distributor of IT products. On Dec 9, 1981, the name of the company was changed to Kewalram Private Limited and subsequently to Redington (India) Private Limited on April 28, 1987. Redington’s registered office was transferred to Chennai, Tamil Nadu by the company law board order dated July 13, 1994. They changed their name to Redington (India) Limited with effect on October 1, 1996.
The company became a Public Limited Company after registering with the registrar of companies, Tamil Nadu on the same date. On Jan 10, 2002, Redington became a private company but later on March 15, 2002, it again became a public one. Whereas it officially started its operation in the year 1993 as R.Srinivasan co-founded. With the group’s commencement of operation in 1993, Redington gradually started to operate in the Middle East and Africa, and other Asian countries.
Redington provides end-to-end supply chain solutions for all categories IT, Telecom, Lifestyle, Healthcare, and Solar Products. To more than 20 nations, Redington delivers hardware and software from more than 40 manufacturers, including Adobe, Cisco, Epson, Hitachi, Eastman Kodak, Lenovo, Nokia, Novell, Philips, and IBM. Today, new-age technologies like Artificial intelligence, IoT (Internet of things), Big Data, and Analytics are opening new possibilities and new opportunities for tomorrow.
|No. of Employees||1500-5000+|
|Market Cap||Rs 11,115.37 Crore (2022)|
|Annual Revenue||Rs 22,707.82 Crore (2021)|
|Net Income/ Profit||Rs 388.07 Crore (2021)|
Products & Services by Redington India
Redington India has been in the logistics industry for more than 20+ years and deals in
- Distribution of IT products
- Logistics Service
- Server and Storage
- Desktop Computer
- Networking Service
- Printers, Scanners
- Storage devices and memory cards
Competitors of Redington India
Following are the top 5 competitors of India,
- Ingram Micro Inc.
- HCL Technologies Ltd.
- CMC Ltd.
- Compuage Infocom
- JK Software Solution
As now we have a better understanding of Redington India, let’s look into the SWOT Analysis of Redington India.
SWOT Analysis of Redington India
A SWOT analysis of Redington India identifies the company’s strengths, weaknesses, opportunities, and threats. A proven and true management paradigm that allows Redington India to compare its business and performance with competitors and the industry as a whole.
So let us go ahead and first have a glance at the strengths of Redington India from the SWOT analysis of Redington India.
Strengths of Redington India
As one of the leading companies in the industry, Redington India, Inc. It has numerous strengths that make it stand out in the market. These strengths not only help protect your market share in existing markets but also help you penetrate new markets.
- Strong Portfolio: Redington India is a supply chain solutions provider to over 245+ international brands in IT and Mobility spaces, serving 37 emerging markets for the last 28+ years with 70+ sales offices.
- A Comprehensive Range of Products: Redington India offers a wide range of products like printers, scanners, plotters, PCs, UPS, networking, packaged software, storage, hard disks, etc. This wide range spectrum of products helps them to achieve economies of scale and provide the customers with a single sourcing point.
- Long-term Vendor Relationship: They have relationships with over 30 vendors out of which are for more than 10 years. Their ability to provide a host of services such as logistics, after-sale support, etc. helped them to build a diverse vendor base.
- Strong Credit Controls & Prudent Risk Management Practices: Redington India has a risk management team dedicated to managing credit risk. The prudent risk management helped them to maintain their bad debts at an average of less than 0.09% of sales in India.
- Wide Reach & Superior Logistics Capabilities: India being a vast country makes it difficult for products to reach every part of the country but Redington having 200+ warehouses in India makes it easier for the products to reach every customer who resides in the nook and corner of the country.
- Strong Firm Recognition: Over the years, Redington has been perceived as a company that can be trusted. It can easily be evidenced by their long term bonds with the vendors and channel partners. Therefore the company enjoys a good reputation in the market.
- Rising Net Profit: Redington India consolidated net profit rose 102.56% in the December 2021 quarter to Rs 388.07 crore compared to Rs 191.58 crore during the previous quarter ended December 2020.
Weaknesses of Redington India
The weaknesses of Redington can either be a lack of resources or the absence of strengths that are required but the company doesn’t have at present. Leaders have to be certain if the weakness is because of ineffective strategic planning or a result of strategic choice.
- Declining Market Share: The market share of Redington India is decreasing but with increasing revenue. Computer peripheral industries are growing faster than others. To figure out what Redington should do to drive future growth, it should carefully analyse the trends within the technology sector.
- Higher Turnover of Employees: Employee turnover at the lower level is a great weakness for them. To maintain its employees it has to increase their salaries to maintain the talent in the firm.
- Niche Markets & Local Monopolies: Redington India’s ability to exploit the niche market and local monopolies are rapidly disappearing. Redington’s customer support is less and less effective.
- The Extra Cost of Building a New Supply Chain & Logistics Network: In the technology industry, the Internet and Artificial Intelligence has significantly altered the business model and thus decreased the importance of the dealer network. A new supply chain has to be built by Redington, which can be expensive.
- Business Model: As the computer peripheral industry is fast-growing, the business model of Redington can be easily imitated by its competitors. To tackle this obstacle, a platform model should be created to integrate suppliers, vendors, and end-users.
Opportunities for Redington India
Opportunities are potential areas for companies to focus on to improve results, increase sales, and ultimately profit.
- Opportunities in the Online Market: Since online usage/services are increasing, Redington can provide new offerings to the customers to create strong customer networking.
- The Rapid Expansion of the Economy: Since the US economy is developing, there are a lot of opportunities for Redington to expand their market in the US because Redington India has the know-how to operate in the competitive US market.
- Increasing Government Regulations: Due to rigid and increasing government regulations in the supply chain solutions sector, there is no chance for unorganised players to operate in the industry. This will improve the opportunity for Redington to improve their customer base.
- Increasing Customer Base in Lower Segments: As customers are moving from unorganised players to licensed players, it will provide an opportunity for Redington to penetrate the entry-level market with a no-frill offering.
- Local Collaboration: To enter into the international market, Redington can make use of the opportunity by teaming up with the local players as they have the local expertise and this will bring Redington a global process and execute expertise on the table.
Threats to Redington India
Threats are environmental factors that can harm a company’s development. Here are some of Redington India’s threats:
- Changing Political Environment: As there is a changing political environment because of the Russia and Ukraine war, there is a great threat for Redington to do business in both local and international markets.
- Competitors Catching Up: Though Redington India is still a leader in the supply chain and logistics industry, it is facing stiff obstacles from local and international competitors.
- Shortage of Skilled Workers: Since there is a higher turnover of employees and increasing dependence on innovative solutions, Redington can face an obstacle of skilled human resources in the future.
- Distrust of Institutions: Legal procedures have become expensive and it has become a long drawn process due to the World Trade Organisation’s rigid rules and regulations. This leads to less investment in the emerging markets which can affect Redington’s growth.
- Competitive Pressures: Ingram Micro the world’s largest distributor of IT and Non-It products have strong relationships with global vendors. Due to the vast customer base of this competitor, Redington cannot respond quickly to the needs of niche markets that disruptors are focusing on.
This ends our extensive SWOT analysis of Redington India. Let us conclude our learning below.
Redington, on the whole, has been doing quite well by investing heavily in its business and along with a higher rate of return, which has resulted in a sizable growth in its earnings. It has a strong logistical basis and has reached across all markets it serves, but suffers from employee turnover which needs to be addressed soon.
One of their greatest strengths is that they are increasing their online presence which is a necessity in today’s world. To sustain in the market and expand its global presence one needs to focus more on the online part. Hence, digital marketing is significant in this era. Intrigued to learn more and upskill yourself, check out the IIDE’s 3 months Advanced Digital Marketing Course to know more.
We hope this blog on the SWOT analysis of Redington India has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
If you enjoy in-depth company research just like the SWOT analysis of Redington India, check out our IIDE Knowledge portal for more fascinating case studies.
Thank you for taking the time to read this, and do share your thoughts on this case study of the SWOT analysis of Redington India in the comments section below.