Johnson & Johnson SWOT Analysis

{ Posted on Jun 04 2010 by adam | 7,990 views}

Strengths

Johnson & President is the world’s most comprehensive and generally supported dealers in health care, personal care and baby products manufacturer, having more than 200 operative companies located in 57 countries.

One of its strength is being positioned as one of the companies with best corporate reputation in the United States.

The company sales are about $41.9 billion while total earnings of $7.2 billion as estimated in 2003. Income has increased to 14% worldwide which its strong position in the market.

The firm declared dividends for its shareholders quarterly since 1944 and the dividends have been increasing every year for the last 42 consecutive years.

Johnson & Johnson has an excellent research and development base, which is its strength for surviving in the pharmaceutical sector.

Johnson & Johnson has successfully employed a joint strategy of differentiation that helps it distinguish itself from its competitors. The company offers a wide range of innovation and diverse products.

Johnson & Johnson has employed a business model that primarily focuses and is based on entrepreneurial values which adds to its competitiveness in the market place.

Johnson & Johnson uses innovative and new methods and varying techniques for problem solving and challenges the standard conventional practices. It takes advantage of on emerging markets which enables further growth opportunities.
The use of independent offices working as standalone units in various markets of the world provides the opportunity to develop concepts with cultural considerations and hence, helps the company manage the diversity.

Weaknesses

There is a constant pressure within pharmaceutical markets to reduce prices in accordance with medical budgets and maintain patent expirations to ensure updated generic programmes.

With the changing demands in the market of some key products of Johnson & Johnson, it is now facing challenges. These were mostly branded products that have now been replaced by generic programmes towards the end of patent timelines.

The pharmaceutical industry has an internal weakness which include theft and counterfeiting of drugs and hence, also a weakness of Johnson & Johnson.

Opportunity

The recent acquisition of Pfizer Consumer Healthcare by Johnson & Johnson; it will provide the company an opportunity to promote growth for the Johnson & Johnson.

Johnson & Johnson is continuously investing in new products and developments in its pharmacy products. The investments in its five undergoing regulatory reviews will provide the opportunity to grow the existing product portfolio.


With the development of WTO rules, to prevent the availability of affordable generic drugs, there is an opportunity to reduce the effect of lost sales and profits to generic introductions as patents expire. This will also help Johnson & Johnson where they possess the brands and are looking to capitalise on introducing generic drugs.

Threats

Besides high risk in the pharmaceutical industry, there is a high level of competition for the generics markets where patents expire and it is the first to entry that determines the success of a company.

The current Technological developments with bio-tech concepts as well as development of medicinal technology, the traditional pharmaceutical methods will be soon out of the market place. In the long term however, the economists argue that these methods can prevail alongside the newly developed technologies.

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