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Strengths
2. Lost less money in 2010 than in the previous two years .15 3 .45
3. Closed nearly 100 less stores in 2010 the 2009 in the U.S. .15 4 .6
& Canada
Weaknesses
Business segmentation receives a low weight rating, because it is not as big of a strength
as some of the other strengths for Office Depot. Office Depot has 3 separate divisions with
North American Retail, North American Business Solution Division, and an International
Division. The weakness of this segmentation is the North American BSD, as it is narrow with
private brands and small- and medium-sized customers (David p. 81). It does receive a high
Another strength for Office Depot is that they have lost less money in 2010 than in the
past two years, and that is why it is tied for the top weighted score. Now this section does receive
a 3 rating as it is only a minor strength. This is a catch twenty-two for the company as they are
showing improvement compared to the past two years, but they are still losing money. Now in
2010 Office Depot lost $37,291, which is a major improvement compared to the $265,005 that
the company lost in 2009 (David p. 81-83). As long as Office Depot keeps showing
improvement over the next couple years then this can become a major strength for the
organization.
Another strength for Office Depot is that they have reduced the accounts payable over the
past three years. Now this does not have a great impact because it is not a large reduction, and
that is why it only receives a .05 weight. Accounts payable has dropped from $2,433,812 in
2008, down to $2,271,077 in 2010 (David p. 83) Again, since it is just over $160,000 reduction
over the past year it is only a minor strength. It is still good to see that the company is reducing
their debt.
There are two other item that is tied for the highest weighted score, and it is the fact that
Office Depot has closed less stores over the past year in North America and they have reached
40+ countries online. Now both of these items are major strengths for Office Depot, because they
are not downsizing like the company has in past years. In 2009, Office Depot closed 121 stores
and only opened 6 additional stores. In 2010, Office Depot closed 22 stores, but opened 17 new
stores (David p. 82). This shows a significant improvement from prior years. With local areas
stores getting more stable Office Depot is able to focus on reaching forty plus companies outside
of North America through the internet. These websites provide extensive service, while offering
Now one weakness that continues to be a major factor for Office Depot is they continue
to lose money. According to the text they have lost money every quarter so far in 2011, and that
is why this carries the highest weight, and is a major weakness of the company. After such a
major drop from 2009 to 2010 many thought that 2011 would be the year that Office Depot turns
it around. Well, at this point in the year this does not seem to be the case, and is a major
One item that received an average weight is the fact that Office Depot closed more than
20 stores compared to the previous year Internationally (David p. 82). Now this is just a minor
weakness for Office Depot. It is a small setback because it is for the company as they try to
expand globally. Also, it is not the biggest deal as long as the organization have expanded their
websites full service to these areas, they just lose out on an actual store front.
Another thing that is a weakness for Office Depot is reduction of stockholder’s equity of
the past couple years. Now this has received an average weighted score because it is not their
biggest weakness, but it is still an area to be concerned with. It does not look good to investors
when they see a drop over a few years. In 2008, the stockholder’s equity for Office Depot was
$1,362,950 and dropped down $695,496 in 2010. The big difference over this span is the drop in
Another weakness, though it is not a big concern, hence the lowest weighted score is the
reduction in current assets from last year. The main reason that this is considered a weakness is
because it has fluctuated the past couple years. Total current assets have gone from $3,122,387 to
$3,206,329 to $3,027,942 in 2008 2009 and 2010 respectively (David p.83). The main cause of
this is the reduction of net receivables of nearly $500,000 over the three-year span. When the
receivables goes down it shows that they are not bringing in as much money.