Compaq

7 Pages 1854 Words

companies will be their ability to compete with foreign companies to sell high technology products abroad. Sales to foreign companies and governments must be approved by the Federal Government. The latest technological advances are often limited to sales within the U.S. for national security reasons.

The computer hardware industry is benefiting from great technological strides. These advancements have resulted in bringing new products to market a fast pace and bringing the costs of producing components down as well. As the computer hardware industry matures companies are finding new uses for products, especially desk top computers. New software is being developed and marketed aiding companies in becoming more effective and cost efficient.


B. Industry Analysis (buyers, suppliers, substitutes, potential entrants, and present competition)

The computer hardware industry is growing in leaps and bounds. IBM one of the best funded companies in the industry is having problems meeting demand. This has helped Compaq's growth. While there are relatively no substitute products for computers the threat of entry by new firms is growing. There are limited barriers to entry or exit due to the ease of assembling computers (can be done in one's own barn).

Buyers of PC's are benefiting not only from a growing number of manufacturers, but also rapidly developing technology. A whole new group of buyers (for personal use) are emerging due to severe price decreases in the computer industry. These new buyers are becoming a stronger force influencing computer firm's pricing, product, and user support strategies.

Suppliers of computer components are losing their pricing power as new ...