| SWOT Analysis Strengths, Weaknesses, Opportunites and Threats (SWOT). SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues. SWOT stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors. Opportunities and threats are external factors. At the bottom of this page are FREE SWOT examples - so please read on. In SWOT, strengths and weaknesses are internal factors. For example:A strength could be: - Your specialist marketing expertise.
- A new, innovative product or service.
- Location of your business.
- Quality processes and procedures.
- Any other aspect of your business that adds value to your product or service.
A weakness could be: -
Lack of marketing expertise. -
Undifferentiated products or services (i.e. in relation to your competitors) . -
Location of your business. -
Poor quality goods or services. -
Damaged reputation. In SWOT, opportunities and threats are external factors. For example: An opportunity could be: -
A developing market such as the Internet. -
Mergers, joint ventures or strategic alliances. -
Moving into new market segments that offer improved profits. -
A new international market. -
A market vacated by an ineffective competitor. A threat could be: -
A new competitor in your home market. -
Price wars with competitors. -
A competitor has a new, innovative product or service. -
Competitors have superior access to channels of distribution. -
Taxation is introduced on your product or service. A word of caution, SWOT analysis can be very subjective. Do not rely on SWOT too much. Two people rarely come-up with the same final version of SWOT. TOWS analysis is extremely similar. It simply looks at the negative factors first in order to turn them into positive factors. So use SWOT as guide and not a prescription. Simple rules for successful SWOT analysis. -
Be realistic about the strengths and weaknesses of your organization when conducting SWOT analysis. -
SWOT analysis should distinguish between where your organization is today, and where it could be in the future. -
SWOT should always be specific. Avoid grey areas. -
Always apply SWOT in relation to your competition i.e. better than or worse than your competition. -
Keep your SWOT short and simple. Avoid complexity and over analysis -
SWOT is subjective. SWOT Analysis Examples SWOT Analysis Wal-Mart Strengths. - Wal-Mart is a powerful retail brand. It has a reputation for value for money, convenience and a wide range of products all in one store.
- Wal-Mart has grown substantially over recent years, and has experienced global expansion (for example its purchase of the United Kingdom based retailer ASDA).
- The company has a core competence involving its use of information technology to support its international logistics system. For example, it can see how individual products are performing country-wide, store-by-store at a glance. IT also supports Wal-Mart's efficient procurement.
- A focused strategy is in place for human resource management and development. People are key to Wal-Mart's business and it invests time and money in training people, and retaining a developing them.
Weaknesses. - Wal-Mart is the World's largest grocery retailer and control of its empire, despite its IT advantages, could leave it weak in some areas due to the huge span of control.
- Since Wal-Mart sell products across many sectors (such as clothing, food, or stationary), it may not have the flexibility of some of its more focused competitors.
- The company is global, but has has a presence in relatively few countries Worldwide.
Opportunities. - To take over, merge with, or form strategic alliances with other global retailers, focusing on specific markets such as Europe or the Greater China Region.
- The stores are currently only trade in a relatively small number of countries. Therefore there are tremendous opportunities for future business in expanding consumer markets, such as China and India.
- New locations and store types offer Wal-Mart opportunities to exploit market development. They diversified from large super centres, to local and mall-based sites.
- Opportunities exist for Wal-Mart to continue with its current strategy of large, super centres.
Threats. - Being number one means that you are the target of competition, locally and globally.
- Being a global retailer means that you are exposed to political problems in the countries that you operate in.
- The cost of producing many consumer products tends to have fallen because of lower manufacturing costs. Manufacturing cost have fallen due to outsourcing to low-cost regions of the World. This has lead to price competition, resulting in price deflation in some ranges. Intense price competition is a threat.
'Wal-Mart Stores, Inc. is the world's largest retailer, with $256.3 billion in sales in the fiscal year ending Jan. 31, 2004. The company employs 1.6 million associates worldwide through more than 3,600 facilities in the United States and more than 1,570 units . . .more? Go to Wal-Mart Facts Disclaimer: This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only. |
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