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V Tech SWOT & PESTLE Analysis

ID : 52331453| Sep 2020| 15 pages


Business Sector :Consumer Electronics

Operating Geography :Hong Kong, Global

About V Tech :

VTech is a leading developer of electronic educational products for children of all age groups starting from infants to toddlers and preschoolers. It is also the world's largest manufacturer of cordless phones. The Company provides contract manufacturing services and total turnkey services to clients in a number of products. Since its inception in 1976, VTech has pioneered the market for electronic learning toys. It offers a wide range of utility products. Headquartered in Hong Kong, it started off originally as a Chinese company capturing the market for telephone products, educational learning toys for children and hospitality products. VTech employs 27000 people across 13 countries and regions with R&D centers in Hong Kong, China, Germany, the US, Canada and Taiwan. This extensive and diverse network permits VTech to stay updated with the latest technology and trends, while maintaining a highly competitive cost structure. As of 2018, this Hong Kongese global supplier of electronic learning products has its presence in 21 countries.

VTech Group has leveraged decades of experience in cordless telephony to offer a wide spectrum of telecommunication products to meet both home and business needs through its cutting edge innovation in technology and exclusive designs. VTech is recognized as one of the world's top 50 electronics manufacturing company and leader in manufacture of cordless devices. The company's business offerings range from entry-level to enterprise-level solutions. VTech Holdings Limited features on The Stock Exchange of Hong Kong Limited.

VTech's USP or unique selling proposition lies in being a vertically integrated organization with a wide spectrum of innovative offerings and in being the world's largest manufacturer of cordless phones. The Group's mission is "to design, manufacture and supply innovative and high quality products in a manner that minimizes any impact on the environment, while creating sustainable value for its stakeholders and the community."

V Tech Revenue :

US$2,079.3 million – FY 31st March 2017 (y-o-y growth 12.0%)
US$1,856.5 million – FY 31st March 2016

Ownership / Major shareholders :

As of April 2018, the major shareholders of the company are as follows –
1) Capital Research & Management Co. (Global Investors) (8.86%)
2) BlackRock Fund Advisors (4.11%)
3) Templeton Asset Management Ltd (4.11%)
4) Capital Research & Management Co. (World Investors) (3.12%)
5) Templeton Asset Management Ltd. (Hong Kong) (2.55%)

Competitive Analysis of V Tech

The SWOT analysis of V Tech is presented below:
1. Long established name in market
2. Diverse product line
3. High Customer satisfaction
4. Pan continental market
1. Inconsistent financial performance
2. Security breaches resulting in compromised data
1. Global market Growth looks promising
2. Low cost of technology
3. Global market presence
4. Mergers and Acquisitions
1. Threat of counterfeit Products, fear of copycats
2. Changing political systems(de-globalisation)
3. Threats from suppliers
4. Threats from competitors
5. Continuous need for R&D
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Detailed SWOT Analysis of V Tech



1. Established brand name with proven innovative offerings: Though VTech started business creating and selling home TV games in 1976, it soon ventured into cordless telephony and got into providing contract manufacturing services. It has emerged as a record revenue generator in 2017, surpassing US $2 billion marks. It continuously improvised its design, technology and products through its dedicated R&D unit. It manufactures top of the class cordless phone, baby monitors, smart watches, conference phones besides kid’s electronic toys. It has a loyal customer base and has a wide range of products to cater to a various age of the audience. The continuous innovations further establish it as a market leader. The good performance of its existing products also strengthens its confidence to elaborate and further diversify its range. The long trustworthy name established in the market is attributed to its 40 years of continuous operations across all continents and catering to varied geographical location and countries. This has earned the VTech brand trust and reliability amongst its customers and stakeholders.

2. Diverse Product line: VTech has a vast array of products under its banner. They have captured the market in three major segments including: Electronic learning products, Telecommunication products, and contract manufacturing products.It is a market leader in electronic learning toys from infancy to toddler stage globally. It has also gained number one position in cordless phone manufacturing globally and has a presence in as many as 79 countries. Also, it is placed 29th among the world’s top 50 EMS providers as of 2017 which surpassed $273 billion in revenue. The products range from baby’s toys, cordless phones, SMB phone, medical and health products, industrial products, professional audio equipment besides others. The spectacular success of KidiBuzzhand-held smart device and Kid zoom Smartwatch for kids, the Group plans to expand its Kids line of electronics to include an exhilarating new karaoke machine, fun microphone and hi-tech journal.

3. High customer satisfaction: VTech has always maintained and established high quality products and has a vast number of satisfied customers globally that is proven by its share in the market. VTech has a high track record in terms of sustainability and innovation. According to a recent survey by the Eastern Management Group, "VTech, in a remarkable achievement, is the only company for which 100 percent of survey respondents said they would recommend its VoIP phones to a friend." This was unparalleled for any VOIP phone lender to score a cent percent in all 10 customer satisfaction measurements.

4. Pan continental Market: VTech has a huge market globally. It has its presence in 21 countries and a chunky market share in each of them. The diversity of its operation clearly indicates an efficient and skilled management. It has its presence in Asia Pacific, Europe, Latin – America, middle east and Africa and North America. It thus, has an advantage in terms of market understanding and needs for various segments. With such a varied experience and deep understanding of the markets, VTech could very conveniently scale in the upcoming years.


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This section is available only in the 'Complete Report' on purchase.


1. Threat of counterfeit Products, fear of copycats: The unorganized sector accounts for almost 60 % of all toys of which most of them are counterfeit toys. Chinese companies are known for their copycat products of leading brands. Ironically, Chinese counterfeit products accounted for 62% of all counterfeit toy seizures in 2015. The U.K. toy industry reported a sales decrease of 2.8% due to counterfeit toys entering the market in 2017. The European Union is also facing a similar situation in this space. Europol, the government agency looking into the situation has revealed that counterfeit products including toys and clothes and medicines represent about 5% of all EU imports costing EUR 85 billion. Jobs in companies like VTech have also been threatened. The EU government loses EUR 14.6 billion every year because of counterfeit products according to the Europol statement in 2018. VTech is also susceptible to the growing demand of cheaper products that offer the same or slightly lesser product features.

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Major Competitors :

  • Hasbro
  • Lego
  • Fisher-Price
  • Mattel
  • Jakks
  • Spin Master
  • Step 2
  • Jazwares

Major Brands :

  • VTech Communications Ltd.
  • Vtech Electronics ltd.
  • Vetch Telecommunications Ltd.

Key Business Segments / Diversification :

V Tech
Conference Phones Audio Monitors 4-Line Small Business Phones Wireless Monitoring System
Wireless Monitoring System With Telephone Wi-Fi HD Cameras Cordless Phones Senior Phones
Doorbell Phones FoneDeco Phones Baby Monitors Baby Soothers SIP Phones
Wi-Fi Monitors Video Monitors Electronic Toys Routers

Recent Acquisition / Mergers / Alliance / Joint Ventures / Divestitures :

Open Table Preview
Business Segment
Objective/Synergy Achieved
Pioneer CorporationDigital entertainment products 2018AcquisitionVTech Contract Manufacturing Services will benefit from the manufacturing unit in Malaysia acquired as a result of this deal. Its manufacturing capabilities will be increased by as much as 25%. The presence of a manufacturing unit outside China will also help in servicing global customers.
Leapfrog EnterprisesElectronic toys 2016AcquisitionThe deal was closed for $72 million and with this deal VTech would be able able to cash in on the consumer goodwill that LeapFrog had previously enjoyed.
Snom Technology AGTelecommunications2016AcquisitionThis deal was closed for an undisclosed amount and with this deal VTech would be able to utilize Snom’s VoIP technology to create the best in class business telephones in the world
Source: Company website and other reliable sources. The detailed table is available in the Complete Report.
SWOT & PESTLE (combined)
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SWOT & (2021). V Tech SWOT & PESTLE Analysis - SWOT & [online] Available at: [Accessed 08 Mar, 2021].

In-text: (SWOT &, 2021)

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V Tech SWOT and PESTLE analysis has been conducted by Nida A and reviewed by senior analysts from Barakaat Consulting.

Copyright of V Tech SWOT and PESTLE Analysis is the property of Barakaat Consulting. Please refer to the Terms and Conditions and Disclaimer for usage guidelines.

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