swot analysis of a company case study

SWOT Analysis Case Studies

The SWOT analysis method is the situation analysis method. It was proposed by Weirik, a professor of management at the University of San Francisco in the early 1980s. It is often used in enterprise strategy formulation, competitor analysis and other occasions including analysis of S trengths, W eaknesses, O pportunities, and T hreats. Therefore, the SWOT analysis is a method that comprehensively summarizes the various aspects of the internal and external conditions of the enterprise, and then analyzes the strengths and weaknesses of the organization, opportunities, and threats faced.

Through SWOT analysis, you can help companies to pool resources and actions in their strengths and where there are the most opportunities; and to make their strategy clearer.

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What is a SWOT model

The analysis of strengths and weaknesses focuses on the strength of the company itself and its comparison with competitors, while the opportunity and threat analysis focus on changes in the external environment and possible impact on the company. In the analysis, all internal factors (i.e., strengths and weaknesses) should be grouped together and then evaluated by external forces (opportunities and threats).

Internal Factors (Strengths and weaknesses)

The analysis of strengths and weaknesses (S-W) of internal conditions is an internal method of assessment. The main purpose is to confirm the relationship between expertise and ability of the organization’s internal conditions. The strengths and weaknesses of its internal conditions are internal factors that the organization can control, including financial resources, technical resources, research and development, organizational culture, human resources, product characteristics, and marketing resources.

External Factors (opportunities and threats)

With the rapid development of economy, science and technology and many other aspects, especially the acceleration of globalization and integration of the world economy, the establishment of global information networks and the diversification of consumer demand, the environment in which companies are located are more open and volatile. This change has had a profound effect on almost all businesses. Because of this, environmental analysis has become an increasingly important corporate function.

The Opportunity and Threat (O-T) analysis is a method of evaluating the external environment. The main purpose is to confirm the relationship between the competitions of the industrial environment outside the organization. The opportunities and threats of the external environment are external factors that cannot be controlled by the organization, including factors such as competition, politics, economy, law, society, culture, science and technology, and demographic environment.

What is a Competitive Advantage?

Identifying attractive opportunities in the environment is one thing, and having the necessary competency to succeed in an opportunity is another matter. Each company must regularly check its strengths and weaknesses. When two companies are in the same market or they all can provide products and services to the same customer group, if one of them has higher profitability or profit potential, then we think that the company has a higher competitive advantage than the other. In other words, the so-called competitive advantage refers to a company’s ability to surpass its competitors, and this ability helps to achieve the company’s main goal – profitability. However, it is worth noting that competitive advantage is not necessarily fully reflected in higher profitability, because sometimes companies prefer to increase market share or employees.

Competitive advantage can refer to any superiority in the eyes of a consumer or its product in comparison with its competitors. It can be the breadth of the product line, the size, quality, reliability, suitability, style, and image of the product and services. Although a competitive advantage refers to a company that has a stronger overall advantage than its competitors, it is more meaningful to specify in which area the company has an advantage, because only in this way can we foster strengths and avoid weaknesses, or we can defeat the weakness.

Since the enterprise is a whole and the sources of competitive strengths are very extensive, it is necessary to make a detailed comparison between the company and its competitors from the aspects of the entire value chain when analyzing the strengths and weaknesses. Such as whether the product is novel, whether the manufacturing process is complicated, whether the sales channel is unimpeded, and whether the price is competitive. If an enterprise’s advantage in one aspect or several aspects is the key success factor that a company in the industry should have, then the enterprise’s comprehensive competitive advantage may be stronger. It should be pointed out that to measure whether a company and its products have a competitive advantage can only stand on the perspective of existing potential users, rather than stand on the perspective of the company.

In the process of maintaining a competitive advantage, enterprises must profoundly understand their resources and capabilities and take appropriate measures. Because once a company has a competitive advantage in one aspect, it is bound to attract the attention of competitors. Generally speaking, after a period of hard work, the company establishes a certain competitive advantage; then it is in a situation to maintain this competitive advantage, and competitors start to respond gradually; and if the competitors directly attack the advantage of the company, or Taking other more powerful strategies will weaken this advantage.

The main factors affecting the duration of a company’s competitive strengths are:

• How long does it take to establish this advantage?
• What are the advantages to be obtained?
• How long does it take for a competitor to make a strong reaction?

If the company analyzes these three factors clearly, it will identify itself in establishing and maintaining its competitive advantage.

The company should not correct all its weaknesses, nor should it make use of all its strengths. The main question is whether the company should be limited to the opportunities it already has, or whether it should acquire and develop some strengths to find better opportunities.

SWOT Analysis Strategies

In the process of adaptability analysis, enterprise top management should be based on the determination of internal and external variables, using leverage, inhibitory, vulnerability, and problematic four basic concepts to analyze this model.

• Leverage (S + O).  Leverage effects arise when internal and external opportunities are consistent and adaptive to one another. In this situation, companies can use their internal strengths to pick up external opportunities and fully integrate opportunities and strengths. However, opportunities are often fleeting, so companies must sharply capture opportunities and seize the opportunity to seek greater development.
• Inhibitory (W + O).  Inhibiting means impeding, preventing, influencing and controlling. When the opportunities provided by the environment are not suited to the internal resource advantages of the company, or cannot be overlapped with each other, the strengths of the enterprise will no longer be realized. In this situation, companies need to provide and add certain resources to promote the transformation of internal resources and weaknesses into strengths to cater to or adapt to external opportunities.
• Vulnerability (S + T).  Vulnerability means the decrease or decrease in the degree or intensity of strengths. When environmental conditions pose a threat to the company’s strengths, the strengths cannot be fully exerted and ending up with a fragile situation. In this situation, companies must overcome the threats to take advantage of them.
• Problematic (W + T).  When the company’s internal weaknesses and corporate external threats meet, companies face severe challenges. If they are not properly handled, they may directly threaten the survival of the company.

Steps for Conducting SWOT Analysis

• What is the current strategy?
• Confirm the changes in the external environment of the company (Porter 5 force or PEST)
• According to the company’s resource mix, confirm the company’s key capabilities and key constraints.
• Construct the SWOT Matrix by placing each one of already identified factors. This is an excellent graphic presentation of what is good and what is bad in your company, and what you can expect as an opportunity or threat.
• Define SWOT Strategies
• Choose what strategy to be adopted and determine the future direction and improvement actions to be taken

Case Study 1: Amazon SWOT Analysis

Amazon Detailed SWOT Analysis

• Brand Identity: Amazon is synonymous with online sales services, and Amazon focuses on improving customer satisfaction during the business process.
• Pioneer advantage: Amazon is undoubtedly the leader in the online retail industry.
• Cost structure: Amazon effectively uses its cost advantage, operates on thin profits, and is still profitable in trading.
• Business Development: Amazon continuously improves its service level and provides diversified services.
• Low-profit margins: Amazon has a very thin profit margin to maintain its cost-leading strategy. But low-profit margins make companies vulnerable to external shocks and crises, as well as other market changes.
• Seasonality: There is a seasonal difference between Amazon’s revenue and business scope, with sales and revenue peaking in the fourth quarter of each year.

Opportunity

• Today’s diversification of e-commerce business
• Continues to increase awareness of its own branded products and services.
• Amazon develops more local websites to participate in the international market. With the international expansion of Amazon, some local businesses have the opportunity to enter the international market.
• Promoting the strategic cooperation between Amazon e-commerce and its related affiliated industries will drive positive development of the industry
• Loss of profits due to low-profit margins
• Patent infringement and other aspects of Amazon’s litigation
• E-commerce industry barriers to entry barriers
• Cybersecurity issues

Amazon – Recent Development

What do you need to do next after you understand strengths and weaknesses and identify opportunities and threats? Let us take a look at how Amazon has seized the opportunity to successfully transform itself from an e-commerce company into a global leading technology company! When Amazon realized the limitations of the retail industry, it expanded its business boundaries promptly. In addition to cloud computing and smart voice, Amazon has also contacted third-party platforms such as logistics and suppliers, and even invested in the film and television industry, making its business model more diversify. In 2008, Amazon realized that content can attract and extend users’ time on the platform, and began to provide original content on Prime Instant Video, Amazon’s mainstream media video platform, and as part of the Prime membership service. Amazon’s ecology can be described as a rotating flywheel. This flywheel is centered on Prime’s membership system, and new interests have been added to it, gradually creating an all-encompassing ecology. While continuing to attract new users, it has promoted the development of Amazon’s e-commerce and other new businesses, and it will continue to do so.

Case Study 2: Starbucks SWOT Analysis

• Strengths – The Starbucks Group has strong profitability, with 2004 revenue exceeding $600 million.
• Weaknesses – Starbucks is known for its continuous improvement and innovation. (Translator’s Note: It can be understood as the instability of the product line)
• Opportunity – The launch of new products and services, such as the sale of coffee at the show.
• Threats – rising costs of coffee and dairy products.

Starbucks Detailed SWOT Analysis

• Starbucks Corporation is a very profitable organization, earning more than $600 million in 2004. The company generated revenue of more than $5000 million in the same year.
• It is a global coffee brand built a reputation for fine products and services. It has almost 9000 cafe shop in almost 40 countries.
• Starbucks was one of the Fortune Top 100 Companies to Work For in 2005. The company is a respected employer that values ​​its workforce.
• The organization has strong ethical values ​​and an ethical mission statement as follows, ‘Starbucks is committed to a role of environmental leadership in all facets of our business.’
• Starbucks has a reputation for new product development and creativity. However, they can vulnerable to the possibility that their innovation may falter over time.
• The organization has a strong presence in the United States of America with more than three-quarters of its cafe shop located in the home market. Some people think they need to invest in different countries (national portfolios) to spread business risks.
• The organization is dependent on a main competitive advantage, the retail of coffee. This could make them slow to diversify into other sectors should the need arise.

Opportunities

• Starbucks is very good at taking advantage of opportunities. E.g. In 2004 the company created a CD-burning service in their Santa Monica (California USA) cafe with Hewlett Packard, where customers created their music CD.
• New products and services that can be retailed in their cafe shop, such as low price products.
• The company has the opportunity to expand its global operations. New markets for coffee such as India and the Pacific Rim nations are beginning to emerge.
• Co-branding with other manufacturers of food and drink and brand franchising to manufacturers of other goods and services both have potential.
• Who knows if the market for coffee will grow and stay in favor with customers, or whether another type of beverage or leisure activity will replace coffee in the future?
• Starbucks is exposed to rises in the cost of coffee and dairy products.
• Since its conception in Pike Place Market, Seattle in 1971, Starbucks’ success has to lead to the market entry of many competitors and copycat brands that pose potential threats.

Case Studies 3: Coca-Cola SWOT Analysis Example

Coca-Cola Detailed SWOT Analysis

• Most sponsored corporate partners.
• Spread across the world in 650 languages ​​and regions.
• The market territory spans nearly 200 countries on five continents.
• To develop new products, the Coca-Cola Company not only sells cola but also other types of beverages.
• Coca-Cola has a long history, so it has a certain status in the market.
• There is no certain integration and the common goal of strategic management.
• The failure to develop new tastes.
• The gradual transfer of customer loyalty.
• Loss of market development opportunities.
• Sponsor the Olympic Games, use this opportunity to replace their brands, products, and make advertisements, especially The Olympic Games is a worldwide movement that allows the world’s population to recognize this product, expand its market reach, and raise awareness of its products.
• Participate in the World Cup, take this world-wide activity to pave the way for your products and gain popularity.
• Enter the Chinese rural market.
• Enter the American film market.
• Pepsi is Coca-Cola’s biggest competitor
• The products produced by the company may not be favored by young people today.
• Coca-Cola is not considered to be good for health by many people

Formulating Actions for SWOT Analysis

Having completed a SWOT Analysis, so what’s next? Is this enough to conduct the SWOT analysis? You need to know when you are analyzing that at the end of the process you need to expect future directions for next actions. Here is an example of formulating actions for a SWOT analysis:

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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SWOT analysis: Examples and templates

A SWOT analysis helps you identify strengths, weaknesses, opportunities, and threats for a specific project or your overall business plan. It’s used for strategic planning and to stay ahead of market trends. Below, we describe each part of the SWOT framework and show you how to conduct your own.

Whether you’re looking for external opportunities or internal strengths, we’ll walk you through how to perform your own SWOT analysis, with helpful examples along the way. 

What is a SWOT analysis?

A SWOT analysis is a technique used to identify strengths, weaknesses, opportunities, and threats for your business or even a specific project. It’s most widely used by organizations—from small businesses and non-profits to large enterprises—but a SWOT analysis can be used for personal purposes as well. 

While simple, a SWOT analysis is a powerful tool for helping you identify competitive opportunities for improvement. It helps you improve your team and business while staying ahead of market trends.

What does SWOT stand for?

SWOT is an acronym that stands for: 

Opportunities

When analyzed together, the SWOT framework can paint a larger picture of where you are and how to get to the next step. Let’s dive a little deeper into each of these terms and how they can help identify areas of improvement. 

Strengths in SWOT refer to internal initiatives that are performing well. Examining these areas helps you understand what’s already working. You can then use the techniques that you know work—your strengths—in other areas that might need additional support, like improving your team’s efficiency . 

When looking into the strengths of your organization, ask yourself the following questions:

What do we do well? Or, even better: What do we do best?

What’s unique about our organization?

What does our target audience like about our organization?

Which categories or features beat out our competitors?

 Example SWOT strength:

Customer service: Our world-class customer service has an NPS score of 90 as compared to our competitors, who average an NPS score of 70.

Weaknesses in SWOT refer to internal initiatives that are underperforming. It’s a good idea to analyze your strengths before your weaknesses in order to create a baseline for success and failure. Identifying internal weaknesses provides a starting point for improving those projects.

Identify the company’s weaknesses by asking:

Which initiatives are underperforming and why?

What can be improved?

What resources could improve our performance?

How do we rank against our competitors?

Example SWOT weakness:

E-commerce visibility: Our website visibility is low because of a lack of marketing budget , leading to a decrease in mobile app transactions.

Opportunities in SWOT result from your existing strengths and weaknesses, along with any external initiatives that will put you in a stronger competitive position. These could be anything from weaknesses that you’d like to improve or areas that weren’t identified in the first two phases of your analysis. 

Since there are multiple ways to come up with opportunities, it’s helpful to consider these questions before getting started:

What resources can we use to improve weaknesses?

Are there market gaps in our services?

What are our business goals for the year?

What do your competitors offer?

Example SWOT opportunities:

Marketing campaign: To improve brand visibility, we’ll run ad campaigns on YouTube, Facebook, and Instagram.

Threats in SWOT are areas with the potential to cause problems. Different from weaknesses, threats are external and ‌out of your control. This can include anything from a global pandemic to a change in the competitive landscape. 

Here are a few questions to ask yourself to identify external threats:

What changes in the industry are cause for concern?

What new market trends are on the horizon?

Where are our competitors outperforming us?

Example SWOT threats:

New competitor: With a new e-commerce competitor set to launch within the next month, we could see a decline in customers.

SWOT analysis example

One of the most popular ways to create a SWOT analysis is through a SWOT matrix—a visual representation of strengths, weaknesses, opportunities, and threats. The matrix comprises four separate squares that create one larger square. 

A SWOT matrix is great for collecting information and documenting the questions and decision-making process . Not only will it be handy to reference later on, but it’s also great for visualizing any patterns that arise. 

Check out the SWOT matrix below for a simple example. As you can see, each of the quadrants lists out the company's strengths, weaknesses, opportunities, and threats.

When used correctly and effectively, your matrix can be a great toolkit for evaluating your organization’s strengths and weaknesses. 

How to do a SWOT analysis, with examples 

A SWOT analysis can be conducted in a variety of ways. Some teams like to meet and throw ideas on a whiteboard, while others prefer the structure of a SWOT matrix. However you choose to make your SWOT analysis, getting creative with your planning process allows new ideas to flow and results in more unique solutions. 

There are a few ways to ensure that your SWOT analysis is thorough and done correctly. Let’s take a closer look at some tips to help you get started.

Tip 1: Consider internal factors 

Often, strengths and weaknesses stem from internal processes. These tend to be easier to solve since you have more control over the outcome. When you come across internal factors, you can start implementing improvements in a couple of different ways.

Meet with department stakeholders to form a business plan around how to improve your current situation.

Research and implement new tools, such as a project management tool , that can help streamline these processes for you. 

Take immediate action on anything that can be changed in 24 hours or less. If you don’t have the capacity, consider delegating these items to others with deadlines. 

The way you go about solving internal factors will depend on the type of problem. If it’s more complex, you might need to use a combination of the above or a more thorough problem management process.

Tip 2: Evaluate external factors

External factors stem from processes outside of your control. This includes competitors, market trends, and anything else that’s affecting your organization from the outside in. 

External factors are trickier to solve, as you can’t directly control the outcome. What you can do is pivot your own processes in a way that mitigates negative external factors. 

You can work to solve these issues by:

Competing with market trends

Forecasting market trends before they happen

Improving adaptability to improve your reaction time

Track competitors using reporting tools that automatically update you as soon as changes occur 

While you won’t be able to control an external environment, you can control how your organization reacts to it. 

Let’s say, for instance, that you’re looking to compete with a market trend. For example, a competitor introduced a new product to the market that’s outperforming your own. While you can’t take that product away, you can work to launch an even better product or marketing campaign to mitigate any decline in sales. 

Tip 3: Hold a brainstorming session

Brainstorming new and innovative ideas can help to spur creativity and inspire action. To host a high impact brainstorming session, you’ll want to: 

Invite team members from various departments. That way, ideas from each part of the company are represented. 

Be intentional about the number of team members you invite, since too many participants could lead to a lack of focus or participation. The sweet spot for a productive brainstorming session is around 10 teammates. 

Use different brainstorming techniques that appeal to different work types.

Set a clear intention for the session.

Tip 4: Get creative

In order to generate creative ideas, you have to first invite them. That means creating fun ways to come up with opportunities. Try randomly selecting anonymous ideas, talking through obviously bad examples, or playing team building games to psych up the team.

Tip 5: Prioritize opportunities

Now, rank the opportunities. This can be done as a team or with a smaller group of leaders. Talk through each idea and rank it on a scale of one through 10. Once you’ve agreed on your top ideas based on team capabilities, competencies, and overall impact, it’s easier to implement them.

Tip 6: Take action

It’s all too easy to feel finished at this stage —but the actual work is just beginning. After your SWOT analysis, you’ll have a list of prioritized opportunities. Now is the time to turn them into strengths. Use a structured system such as a business case , project plan, or implementation plan to outline what needs to get done—and how you plan to do it.

SWOT analysis template

A SWOT analysis template is often presented in a grid format, divided into four quadrants. Each quadrant represents one of the four elements. 

Use this free SWOT analysis template to jump-start your team’s strategic planning.

Identify the strengths that contribute to achieving your objectives. These are internal characteristics that give you an advantage. Some examples could be a strong brand reputation, an innovative culture, or an experienced management team.

Next, focus on weaknesses. These are internal factors that could serve as obstacles to achieving your objectives. Common examples might include a lack of financial resources, high operational costs, or outdated technology. 

Move on to the opportunities. These are external conditions that could be helpful in achieving your goals. For example, you might be looking at emerging markets, increased demand, or favorable shifts in regulations.

Lastly, let's address threats. These are external conditions that could negatively impact your objectives. Examples include increased competition or potential economic downturns.

Why is a SWOT analysis important?

A SWOT analysis can help you improve processes and plan for growth. While similar to a competitive analysis , it differs because it evaluates both internal and external factors. Analyzing key areas around these opportunities and threats will equip you with the insights needed to set your team up for success.

A SWOT analysis isn’t only useful for organizations. With a personal SWOT analysis, you can examine areas of your life that could benefit from improvement, from your leadership style to your communication skills. These are the benefits of using a SWOT analysis in any scenario. 

1. Identifies areas of opportunity

One of the biggest benefits of conducting an analysis is to determine opportunities for growth. It’s a great starting point for startups and teams that know they want to improve but aren’t exactly sure how to get started. 

Opportunities can come from many different avenues, like external factors such as diversifying your products for competitive advantage or internal factors like improving your team’s workflow . Either way, capitalizing on opportunities is an excellent way to grow as a team.

2. Identifies areas that could be improved

Identifying weaknesses and threats during a SWOT analysis can pave the way for a better business strategy.

Ultimately, learning from your mistakes is the best way to excel. Once you find areas to streamline, you can work with team members to brainstorm an action plan . This will let you use what you already know works and build on your company’s strengths.

3. Identifies areas that could be at risk

Whether you have a risk register in place or not, it’s always crucial to identify risks before they become a cause for concern. A SWOT analysis can help you stay on top of actionable items that may play a part in your risk decision-making process. 

It may be beneficial to pair your SWOT analysis with a PEST analysis, which examines external solutions such as political, economic, social, and technological factors—all of which can help you identify and plan for project risks .

When should you use a SWOT analysis?

You won’t always need an in-depth SWOT analysis. It’s most useful for large, general overviews of situations, scenarios, or your business.

A SWOT analysis is most helpful:

Before you implement a large change—including as part of a larger change management plan

When you launch a new company initiative

If you’d like to identify opportunities for growth and improvement

Any time you want a full overview of your business performance

If you need to identify business performance from different perspectives

SWOT analyses are general for a reason—so they can be applied to almost any scenario, project, or business. 

SWOT analysis: Pros and cons

Although SWOT is a useful strategic planning tool for businesses and individuals alike, it does have limitations. Here’s what you can expect.

The simplicity of SWOT analysis makes it a go-to tool for many. Because it is simple, it takes the mystery out of strategic planning and lets people think critically about their situations without feeling overwhelmed. 

For instance, a small bakery looking to expand its operations can use SWOT analysis to easily understand its current standing. Identifying strengths like a loyal customer base, weaknesses such as limited seating space, opportunities like a rising trend in artisanal baked goods, and threats from larger chain bakeries nearby can all be accomplished without any specialized knowledge or technical expertise.

Versatility

Its versatile nature allows SWOT analysis to be used across various domains. Whether it’s a business strategizing for the future or an individual planning their career path, SWOT analysis lends itself well. 

For example, a tech start-up in the competitive Silicon Valley landscape could employ SWOT to navigate its pathway to profitability. Strengths might include a highly skilled development team; weaknesses could be a lack of brand recognition; opportunities might lie in emerging markets; and threats could include established tech giants. 

Meaningful analysis

SWOT excels in identifying external factors that could impact performance. It nudges organizations to look beyond the present and anticipate potential future scenarios. 

A retail company, for example, could use SWOT analysis to identify opportunities in e-commerce and threats from changing consumer behavior or new competitors entering the market. By doing so, the company can strategize on how to leverage online platforms to boost sales and counteract threats by enhancing the customer experience or adopting new technologies.

Subjectivity and bias

The subjective nature of SWOT analysis may lead to biases. It relies heavily on individual perceptions, which can sometimes overlook crucial data or misinterpret information, leading to skewed conclusions. 

For example, a manufacturing company might undervalue the threat of new entrants in the market due to an overconfidence bias among the management. This subjectivity might lead to a lack of preparation for competitive pricing strategies, ultimately affecting the company's market share.

Lack of prioritization

SWOT analysis lays out issues but falls short on prioritizing them. Organizations might struggle to identify which elements deserve immediate attention and resources. 

For instance, a healthcare provider identifying numerous opportunities for expansion into new services may become overwhelmed with the choices. Without a clear way to rank these opportunities, resources could be spread too thinly or given to projects that do not have as much of an impact, leading to less-than-ideal outcomes.

Static analysis

Since SWOT analysis captures a snapshot at a particular moment, it may miss the evolving nature of challenges and opportunities, possibly leading to outdated strategies. An example could be a traditional retail business that performs a SWOT analysis and decides to focus on expanding physical stores, overlooking the growing trend of e-commerce. As online shopping continues to evolve and gain popularity, the static analysis might lead to investment in areas with diminishing returns while missing out on the booming e-commerce market trend.

SWOT analysis FAQ

What are the five elements of swot analysis.

Traditionally, SWOT stands for its four main elements: strengths, weaknesses, opportunities, and threats. However, a fifth essential element often overlooked is "actionable strategies." Originally developed by Albert Humphrey, SWOT is more than just a list—it's a planning tool designed to generate actionable strategies for making informed business decisions. This fifth element serves to tie the other four together, enabling departments like human resources and marketing to turn analysis into actionable plans.

What should a SWOT analysis include?

A comprehensive SWOT analysis should focus on the internal and external factors that affect your organization. Internally, consider your strong brand and product line as your strengths, and maybe your supply chain weaknesses. Externally, you'll want to look at market share, partnerships, and new technologies that could either pose opportunities or threats. You should also account for demographics, as it helps in market targeting and segmentation.

How do you write a good SWOT analysis?

Writing an effective SWOT analysis begins with research. Start by identifying your strengths, like a strong brand, and your weaknesses, like a small human resources department. Following that, look outward to find opportunities, possibly in technological advancement, and threats, like fluctuations in market share. Many businesses find it helpful to use a free SWOT analysis template to structure this information. A good SWOT analysis doesn't just list these elements; it integrates them to provide a clear roadmap for making business decisions.

What are four examples of threats in SWOT analysis?

New technologies: Rapid technological advancement can make your product or service obsolete.

Supply chain disruptions: Whether due to natural disasters or geopolitical tensions, an unstable supply chain can seriously jeopardize your operations.

Emerging competitors: New players entering the market can erode your market share and offer alternative solutions to your customer base.

Regulatory changes: New laws or regulations can add costs and complexity to your business, affecting your competitiveness.

How do you use a SWOT analysis?

Once you've completed a SWOT analysis, use the results as a decision-making aid. It can help prioritize actions, develop strategic plans that play to your strengths, improve weaknesses, seize opportunities, and counteract threats. It’s a useful tool for setting objectives and creating a roadmap for achieving them.

Plan for growth with a SWOT analysis

A SWOT analysis can be an effective technique for identifying key strengths, weaknesses, opportunities, and threats. Understanding where you are now can be the most impactful way to determine where you want to go next. 

Don’t forget, a bit of creativity and collaboration can go a long way. Encourage your team to think outside of the box with 100+ team motivational quotes .

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SWOT Analysis: How To Do One [With Template & Examples]

Published: October 05, 2023

As your business grows, you need a roadmap to help navigate the obstacles, challenges, opportunities, and projects that come your way. Enter: the SWOT analysis.

This framework can help you develop a plan to determine your priorities, maximize opportunities, and minimize roadblocks as you scale your organization. Below, let’s go over exactly what a SWOT analysis is, a few SWOT analysis examples, and how to conduct one for your business.

When you’re done reading, you’ll have all the inspiration and tactical advice you need to tackle a SWOT analysis for your business.

What is a SWOT analysis? Importance of a SWOT Analysis How to Write a Good SWOT Analysis SWOT Analysis Examples How to Act on a SWOT Analysis

What is a SWOT analysis?

A SWOT analysis is a strategic planning technique that puts your business in perspective using the following lenses: Strengths, Weaknesses, Opportunities, and Threats. Using a SWOT analysis helps you identify ways your business can improve and maximize opportunities, while simultaneously determining negative factors that might hinder your chances of success.

While it may seem simple on the surface, a SWOT analysis allows you to make unbiased evaluations on:

• Your business or brand.
• Market positioning.
• A new project or initiative.
• A specific campaign or channel.

Practically anything that requires strategic planning, internal or external, can have the SWOT framework applied to it, helping you avoid unnecessary errors down the road from lack of insight.

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Importance of a SWOT Analysis

You’ve noticed by now that SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. The framework seems simple enough that you’d be tempted to forgo using it at all, relying instead on your intuition to take these things into account.

But you shouldn’t. Doing a SWOT analysis is important. Here’s why.

SWOT gives you the chance to worry and to dream.

A SWOT analysis is an important step in your strategic process because it gives you the opportunity to explore both the potential risks and the exciting possibilities that lie ahead.  You’re giving yourself the space to dream, evaluate, and worry before taking action. Your insights then turn into assets as you create the roadmap for your initiative.

For instance, when you consider the weaknesses and threats that your business may face, you can address any concerns or challenges and strategize on how to mitigate those risks. At the same time, you can identify strengths and opportunities, which can inspire innovative ideas and help you dream big. Both are equally important. 

SWOT forces you to define your variables.

Instead of diving head first into planning and execution, you’re taking inventory of all your assets and roadblocks. This process will help you  develop strategies that leverage your strengths and opportunities while addressing and mitigating the impact of weaknesses and threats.

As a result, you'll gain a comprehensive understanding of your current situation and create a more specific and effective roadmap. Plus, a SWOT analysis is inherently proactive. That means you'll be better equipped to make informed decisions, allocate resources effectively, and set realistic goals. 

SWOT allows you to account for mitigating factors.

As you identify weaknesses and threats, you’re better able to account for them in your roadmap, improving your chances of success.

Moreover, accounting for mitigating factors allows you to allocate your resources wisely and make informed decisions that lead to sustainable growth. With a SWOT analysis as a guide, you can confidently face challenges and seize opportunities.

SWOT helps you keep a written record.

As your organization grows and changes, you’ll be able to strike things off your old SWOTs and make additions. You can look back at where you came from and look ahead at what’s to come.

In other words, SWOT analyses serve as a tangible history of your progress and provide a reference point for future decision-making. With each update, your SWOT analysis becomes a living document that guides your strategic thinking and helps you stay agile and adaptable in an ever-changing business landscape.

By maintaining this written record, you foster a culture of continuous improvement and empower your team to make data-driven decisions and stay aligned with your long-term vision.

Parts of a SWOT Analysis

Conducting a SWOT analysis will help you strategize effectively, unlock valuable insights, and make informed decisions. But what exactly does a SWOT analysis include?

Let’s explore each component: Strengths, Weaknesses, Opportunities, and Threats.

Your strengths are the unique advantages and internal capabilities that give your company a competitive edge in the market. A strong brand reputation, innovative products or services, or exceptional customer service are just a few examples. By identifying and capitalizing on your strengths, you can foster customer loyalty and build a solid foundation for growth.

No business is flawless. Weaknesses are areas where you may face challenges or fall short of your potential. It could be outdated processes, skill gaps within the team, or inadequate resources. By acknowledging these weaknesses, you can establish targeted initiatives for improvement, upskill your team, adopt new technologies, and enhance your overall operational efficiency.

Opportunities are external factors that can contribute to your company's progress. These may include emerging markets, technological advancements, changes in consumer behavior, or gaps in the market that your company can fill. By seizing these opportunities, you can expand your market reach, diversify your product offerings, forge strategic partnerships, or even venture into untapped territories.

Threats are external factors that are beyond your control and pose challenges to your business. Increased competition, economic volatility, evolving regulatory landscapes, or even changing market trends are examples of threats. By proactively assessing and addressing them, you can develop contingency plans, adjust your strategies, and minimize their impact on your operations.

In a SWOT analysis, you’ll have to take both internal and external factors into account. We’ll cover those next.

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SWOT Analysis Internal and External Factors

A SWOT analysis typically has internal (i.e., within your organization) and external (i.e., outside your organization) factors at play. Here's a breakdown of each.

Internal Factors

Internal factors refer to the characteristics and resources within your organization that directly influence its operations and performance. These factors are completely within your organization's control, so they can be modified, improved, or capitalized upon.

In a SWOT analysis, strengths and weaknesses are categorized as internal factors. Let’s look at a few examples.

• Brand reputation
• Unique expertise
• Loyal customer base
• Talented workforce
• Efficient processes
• Proprietary technology
• Outdated technology
• Inadequate resources
• Poor financial health
• Inefficient processes
• Skill gaps within the team

External Factors

External factors are elements outside the organization's control that have an impact on its operations, market position, and success. These factors arise from the industry climate and the broader business environment. You typically have no control over external factors, but you can respond to them.

In a SWOT analysis, opportunities and threats are categorized as external factors. Let’s look at a few examples.

• Emerging markets
• Changing consumer trends
• Technological advancements
• Positive shifts in regulations
• New gaps in the market you could fill
• Intense competition
• Economic downturns
• Disruptive technologies
• Changing regulations
• Negative shifts in consumer behavior

Remember, a well-rounded SWOT analysis empowers you to capitalize on strengths, address weaknesses, seize opportunities, and navigate threats — all while making informed decisions for the future.

Now, let’s take a look at how you can write a good SWOT analysis for yourself or for stakeholders.

How do you write a good SWOT analysis?

There are several steps you’ll want to take when evaluating your business and conducting a strategic SWOT analysis.

1. Download HubSpot's SWOT Analysis Template.

There’s no need to start from scratch for your analysis. Instead, start by downloading a free, editable template from HubSpot. Feel free to use the model yourself, or create your own as it suits your needs.

3. Identify your objective.

Before you start writing things down, you’ll need to figure out what you’re evaluating with your SWOT analysis.

Be specific about what you want to analyze. Otherwise, your SWOT analysis may end up being too broad, and you’ll get analysis paralysis as you are making your evaluations.

If you’re creating a new social media program, you’ll want to conduct an analysis to inform your content creation strategy. If you’re launching a new product, you’ll want to understand its potential positioning in the space. If you’re considering a brand redesign, you’ll want to consider existing and future brand conceptions.

All of these are examples of good reasons to conduct a SWOT analysis. By identifying your objective, you’ll be able to tailor your evaluation to get more actionable insights.

4. Identify your strengths.

“Strengths” refers to what you are currently doing well. Think about the factors that are going in your favor as well as the things you offer that your competitors just can’t beat.

For example, let’s say you want to use a SWOT analysis to evaluate your new social media strategy.

If you’re looking at a new social media program, perhaps you want to evaluate how your brand is perceived by the public. Is it easily recognizable and well-known? Even if it’s not popular with a widespread group, is it well-received by a specific audience?

Next, think about your process: Is it effective or innovative? Is there good communication between marketing and sales?

Finally, evaluate your social media message, and in particular, how it differs from the rest of the industry. I’m willing to bet you can make a lengthy list of some major strengths of your social media strategy over your competitors, so try to dive into your strengths from there.

5. Identify your weaknesses.

In contrast to your strengths, what are the roadblocks hindering you from reaching your goals? What do your competitors offer that continues to be a thorn in your side?

This section isn’t about dwelling on negative aspects. Rather, it’s critical to foresee any potential obstacles that could mitigate your success.

When identifying weaknesses, consider what areas of your business are the least profitable, where you lack certain resources, or what costs you the most time and money. Take input from employees in different departments, as they’ll likely see weaknesses you hadn’t considered.

If you’re examining a new social media strategy, you might start by asking yourself these questions: First, if I were a consumer, what would prevent me from buying this product, or engaging with this business? What would make me click away from the screen?

Second, what do I foresee as the biggest hindrance to my employees’ productivity, or their ability to get the job done efficiently? What derails their social media efforts?

6. Consider your opportunities.

This is your chance to dream big. What are some opportunities for your social media strategy you hope, but don’t necessarily expect, to reach?

For instance, maybe you’re hoping your Facebook ads will attract a new, larger demographic. Maybe you’re hoping your YouTube video gets 10,000 views and increases sales by 10%.

Whatever the case, it’s important to include potential opportunities in your SWOT analysis. Ask yourself these questions:

• What technologies do I want my business to use to make it more effective?
• What new target audience do I want to reach?
• How can the business stand out more in the current industry?
• Is there something our customers complain about that we could fix?

The opportunities category goes hand-in-hand with the weaknesses category. Once you’ve made a list of weaknesses, it should be easy to create a list of potential opportunities that could arise if you eliminate your weaknesses.

7. Contemplate your threats.

It’s likely, especially if you’re prone to worry, you already have a good list of threats in your head.

If not, gather your employees and brainstorm. Start with these questions:

• What obstacles might prevent us from reaching our goals?
• What’s going on in the industry, or with our competitors, that might mitigate our success?
• Is there new technology out there that could conflict with our product?

Writing down your threats helps you evaluate them objectively.

For instance, maybe you list your threats in terms of least and most likely to occur and divide and conquer each. If one of your biggest threats is your competitor’s popular Instagram account, you could work with your marketing department to create content that showcases your product’s unique features.

SWOT Analysis Chart

Download a free SWOT analysis chart included in HubSpot’s free market research kit .

A SWOT analysis doesn’t have to be fancy. Our SWOT analysis chart provides a clear and structured framework for capturing and organizing your internal strengths and weaknesses, and external opportunities and threats. It's the perfect visual aid to make sense of the wealth of information gathered during your analysis.

(Plus, you can always customize and paste it into a document you plan to share with stakeholders.)

But remember: Filling out the SWOT chart is just one step in the process. Combine it with our entire market research kit , and you'll have all the tools necessary to help your organization navigate new opportunities and threats.

SWOT Analysis Examples

The template above helps get you started on your own SWOT analysis.

But, if you’re anything like me, it’s not enough to see a template. To fully understand a concept, you need to see how it plays out in the real world.

These SWOT examples are not exhaustive. However, they are a great starting point to inspire you as you do your own SWOT analysis.

Apple’s SWOT analysis

Here’s how we’d conduct a SWOT analysis on Apple.

First off, strengths. While Apple has many strengths, let’s identify the top three:

• Brand recognition.
• Innovative products.
• Ease of use.

Apple’s brand is undeniably strong, and its business is considered the most valuable in the world . Since it’s easily recognized, Apple can produce new products and almost ensure a certain degree of success by virtue of the brand name itself.

Apple’s highly innovative products are often at the forefront of the industry. One thing that sets Apple apart from the competition is its product inter-connectivity.

For instance, an Apple user can easily sync their iPhone and iPad together. They can access all of their photos, contacts, apps, and more no matter which device they are using.

Lastly, customers enjoy how easy it is to use Apple’s products. With a sleek and simple design, each product is developed so that most people can quickly learn how to use them.

Next, let’s look at three of Apple’s weaknesses.

• High prices
• Closed ecosystem
• Lack of experimentation

While the high prices don’t deter Apple’s middle- and upper-class customer base, they do hinder Apple’s ability to reach a lower-class demographic.

Apple also suffers from its own exclusivity. Apple controls all its services and products in-house, and while many customers become loyal brand advocates for this reason, it means all burdens fall on Apple employees.

Ultimately, Apple’s tight control over who distributes its products limits its market reach.

Lastly, Apple is held to a high standard when it comes to creating and distributing products. Apple’s brand carries a high level of prestige. That level of recognition inhibits Apple from taking risks and experimenting freely with new products that could fail.

Now, let’s take a look at opportunities for Apple.

It’s easy to recognize opportunities for improvement, once you consider Apple’s weaknesses. Here’s a list of three we came up with:

• Expand distribution options.
• Create new product lines.
• Technological advancement.

One of Apple’s biggest weaknesses is its distribution network, which, in the name of exclusivity, remains relatively small. If Apple expanded its network and enabled third-party businesses to sell its products, it could reach more people globally, while alleviating some of the stress currently put on in-house employees.

There are also plenty of opportunities for Apple to create new products. Apple could consider creating more affordable products to reach a larger demographic, or spreading out into new industries — Apple self-driving cars, perhaps?

Finally, Apple could continue advancing its products’ technology. Apple can take existing products and refine them, ensuring each product offers as many unique features as possible.

Finally, let’s look at threats to Apple.

Believe it or not, they do exist.

Here are three of Apple’s biggest threats:

• Tough competition.
• International issues.

Apple isn’t the only innovative tech company out there, and it continues to face tough competition from Samsung, Google, and other major forces. In fact, Samsung sold more smartphones than Apple did in Q1 of 2022 , shipping 17 million more units than Apple and holding 24% of the market share.

Many of Apple’s weaknesses hinder Apple’s ability to compete with the tech corporations that have more freedom to experiment, or that don’t operate in a closed ecosystem.

A second threat to Apple is lawsuits. Apple has faced plenty of lawsuits, particularly between Apple and Samsung . These lawsuits interfere with Apple’s reputable image and could steer some customers to purchase elsewhere.

Finally, Apple needs to improve its reach internationally. The company isn’t number one in China and doesn’t have a very positive relationship with the Chinese government. In India, which has one of the largest consumer markets in the world, Apple’s market share is low , and the company has trouble bringing stores to India’s market.

If Apple can’t compete globally the way Samsung or Google can, it risks falling behind in the industry.

Starbucks SWOT Analysis

Now that we’ve explored the nuances involved with a SWOT analysis, let’s fill out a SWOT template using Starbucks as an example.

Here’s how we’d fill out a SWOT template if we were Starbucks:

Download this Template for Free

Restaurant Small Business SWOT Analysis

Some small business marketers may have difficulty relating to the SWOTs of big brands like Apple and Starbucks. Here’s an example of how a dine-in Thai restaurant might visualize each element.

Small restaurants can lean into their culinary expertise and service skills to find opportunities for growth and brand awareness. A SWOT analysis can also help identify weaknesses that can be improved, such as menu variation and pricing.

While a restaurant might not be as worried about high-level lawsuits, a small business might be more concerned about competitors or disruptors that might enter the playing field.

Local Boutique SWOT Analysis

In another small business example, let’s take a look at a SWOT analysis for a local boutique.

This shop might be well known in its neighborhood, but it also might take time to build an online presence or get its products in an online store.

Because of this, some of its strengths and opportunities might relate to physical factors while weaknesses and threats might relate to online situations.

How to Act on a SWOT Analysis

After conducting a SWOT analysis, you may be asking yourself: What’s next?

Putting together a SWOT analysis is only one step. Executing the findings identified by the analysis is just as important — if not more.

Put your insights into action using the following steps.

Take advantage of your strengths.

Use your strengths to pursue opportunities from your analysis.

For example, if we look at the local boutique example above, the strength of having affordable prices can be a value proposition. You can emphasize your affordable prices on social media or launch an online store.

Address your weaknesses.

Back to the boutique example, one of its weaknesses is having a poor social media presence. To mitigate this, the boutique could hire a social media consultant to improve its strategy. They may even tap into the expertise of a social-savvy employee.

Make note of the threats.

Threats are often external factors that can’t be controlled, so it’s best to monitor the threats outlined in your SWOT analysis to be aware of their impacts on your business.

When to Use a SWOT Analysis

While the examples above focus on business strategy in general, you can also use a SWOT analysis to evaluate and predict how a singular product will play out in the market.

Ultimately, a SWOT analysis can measure and tackle both big and small challenges, from deciding whether or not to launch a new product to refining your social media strategy.

Editor's note: This post was originally published in May 2018 and has been updated for comprehensiveness.

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SWOT analysis: how-to, example and alternatives

Oct 24th, 2023

What is SWOT analysis?

How to do a swot analysis, swot analysis example - amazon case study, swot analysis alternatives.

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To succeed, businesses should evaluate their operations to see what they do well and what areas require improvement. Understanding the features of your company will help you grow and increase profitability. In contrast, you risk falling behind if you don't keep up with the competition by consistently enhancing every element of your business. However,  auditing your organization to learn how you can improve it may seem intimidating. SWOT analysis can facilitate this process.

This framework will help you collect the necessary information and come up with ideas on how to strengthen your weaknesses, get rid of dangers, and highlight your advantages. In this article, we will describe the purpose of SWOT analysis and demonstrate how to apply it in practice.

SWOT analysis is a framework used to assess a company’s strategic position and analyze internal and external aspects that impact its success. This technique will help your business determine competitive advantages, address issues, discover new possibilities, and minimize risks. With this framework, you can gain new insights and identify areas for improvement.

Companies use SWOT analysis to uncover internal and external factors that can influence a business decision. In the 1960s, business and management consultant Albert Humphrey developed this technique to understand the reasons for the failures of corporate planning. Since then, SWOT analysis has become one of the most valuable tools for business owners to evaluate a company’s current landscape and make necessary adjustments.

You can use SWOT analysis to examine an organization, a project, or a new venture. For example, your marketing department can analyze the email marketing strategy and determine how the competition differs from your company in this regard. Moreover, the technique can be a helpful tool for market research . Using the framework, you can identify your unique selling proposition and find market gaps or new niches. In addition, with this technique, you can assess the viability and profitability of a new product, service, or market segment.

SWOT analysis comprises four components: strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors that influence a company’s objectives, such as manufacturing capabilities, personnel, and finance. Opportunities and threats are external factors or aspects your company cannot control, such as technological development, macroeconomics, and legislation. We will cover internal and external elements of the SWOT framework in more detail below.

Strengths are areas where your business excels. These components may include the organization’s accomplishments or resources. For example, if you assess the company’s marketing strategy, these factors might contain a strong mission statement or consistent branding.

On the other hand, if you consider an organization’s overall strengths, they can include great brand awareness or a solid reputation. Moreover, some potential examples of these factors are employee skills, effective processes, exclusive technology, and customer loyalty. Your strengths should set you apart from competitors and highlight what you do better than anyone else.

Weaknesses are areas that the company must strengthen to stay competitive. These are fields where you need more proficiency and factors that keep you from achieving your company objectives. Knowing your vulnerabilities is crucial since they expose a company to risk.

Some weaknesses may include a weak supply chain, lack of funds, employee skill gaps, low customer satisfaction , or substantial debt. Weaknesses may prevent you from taking advantage of opportunities. However, these factors are mostly within your control, so you can improve these areas with the appropriate strategy and tools.

Opportunities

Opportunities are favorable external factors that can provide a competitive edge for a company. These elements can arise from the target market , rivalry, industry, and technology. A business can take advantage of conditions in the environment to develop and execute effective strategies.

Some examples of opportunities are improvements in governmental policies, new business models, unexplored markets , and lowered export tariffs. If you evaluate your marketing strategy, your options might include digital advertisements or new techniques you haven’t used before.

Threats are factors that can negatively affect an organization. They occur when conditions in the external environment endanger the dependability and profitability of an organization's operations. When threats relate to weaknesses, they increase vulnerability. It is crucial to foresee future dangers to protect the company and promote its success.

Examples of threats include declining industry and technological advancements that may disrupt an already existing company's operations. Other aspects may be changing societal standards that make products less appealing to customers, growing production costs, or the seasonality of your business.

You can determine these factors at any point by performing a SWOT analysis. However, it is critical to conduct this study before taking any action that can impact your organization. You can use SWOT analysis to make better decisions when considering new initiatives, changing the business strategy, or establishing partnerships with other businesses. 

We will break the SWOT analysis process into six steps with actionable recommendations. Let us take a closer look at this framework.

Step 1. Set an objective for your analysis

A SWOT analysis may be general, but it will be more practical if narrowed down to one particular objective . As you perform a study before making significant business choices, each opportunity calls for a comprehensive evaluation.

For example, the goal of a SWOT analysis would be to decide whether or not to introduce a new product. Your company will clearly understand what you want to achieve at the end of the process if the employees have an objective in mind.

Step 2. Gather your team and brainstorm ideas

While doing a SWOT analysis, you need a diversified team from various departments. The analysis should include input from every company unit to provide a thorough picture of your business. Choose team members whose responsibility will be to perform a study. In addition, you may also hire a third-party expert or group to advise you on the process.

The team charged with conducting the study should start compiling ideas related to each category of SWOT analysis. Take into account the following areas: innovation, productivity, service, quality, and technological procedures. Evaluate the company’s achievements, recent risks and obstacles, customers’ complaints, employee turnover rate, new industry trends, changes in regulations, and rivals.

List all the suggestions. Some problems may appear on many lists. For instance, a business or department could excel at providing outstanding customer service, but it might also have weaknesses or deficiencies in that area. The objective of this phase is to write down as many ideas as possible. You will evaluate them later. 

Step 3. Identify strengths, weaknesses, opportunities, and threats

When defining strengths, consider what you do well, including your most valuable asset and positive qualities. Strengths typically include product quality, innovation, productivity, and leadership. Understand your competitive advantage , resources, best products, and things that help your company reach its objectives.

Then, analyze weaknesses. Assess your business's shortcomings. To identify potential weaknesses, you can collect feedback from team members, stakeholders, and consumers. Analyzing profit margins and assessing whether teams achieve their goals are other ways to collect more objective data. In addition, examine underperforming product lines, lack of resources, and aspects of the company that interfere with your objectives, including a high staff turnover rate.

Defining your opportunities and threats can be more challenging since you do not consider them frequently. However, these elements are crucial to a company's success as internal factors. Opportunities might include emerging markets, new technology, cost reduction, or geographic expansion. Evaluate how you can benefit from existing economic or market trends and what products or services are popular with your customers. Furthermore, explore new demographics you may want to target.

Finally, analyze the threats. These factors may include the entrance of a new rival, regulations that can affect production, and a declining market. While threats and weaknesses are similar, threats often haven't significantly impacted the company yet. However, they can cause stress on your employees, so it is crucial to recognize threats and create strategies to cope with them.

Step 4. Refine and organize the ideas

Now, it is time to organize the ideas and focus on the greatest opportunities or considerable risks for your business. This stage typically requires serious discussion, so you need to involve top management to summarize and prioritize the findings.

Before developing an action plan for larger company projects, you need to review tasks that may be completed quickly rather than putting them off. Once you identify the most crucial ideas, add them to your SWOT matrix.

Step 5. Develop an action plan

At this stage, you can start turning a SWOT analysis into a strategic plan . First, brainstorm future possible steps with your team. Then, use the bulleted list of factors under each category to create a final strategy.

For example, you are going to launch a new product, and you discover that there is an opportunity to grow to new niche markets . However, weaknesses like rising material costs, the need for more employees, and unpredictable product demand may exceed opportunities and strengths. As a result, you can develop an action plan and reconsider the decision in six months when expenses decline and market demand becomes more transparent.

Step 6. Apply knowledge in practice

Make a final document that is easily accessible for team members so they can check it if necessary. You may review your SWOT analysis quarterly, monthly, or annually to ensure you meet your objectives. Use the document with your findings as a reference while making future decisions or handling other company issues.

Conducting a SWOT analysis is a great way to visualize where you are now and the future objectives you want to reach. By following these steps, you can accomplish the goals and motivate the team at the same time. 

This Amazon SWOT analysis demonstrates how the biggest online retailer utilized its advantages over rivals to dominate the industry. We will examine the company’s strengths, weaknesses, opportunities, and threats and observe how these factors impact Amazon's business strategy. 

Amazon strengths

One of the company’s main strengths is its strong brand reputation. Over the years, Amazon has developed a reputation as an innovative and reliable brand that offers excellent customer service and convenient delivery options. Another strength is its diverse product portfolio, which includes electronics, clothing, books, and household goods. Moreover, Amazon is a customer-oriented brand that provides fast delivery, easy returns, customer reviews, and personalized recommendations.

Amazon employs logistics and delivery methods that are incredibly effective, such as set pricing for various delivery periods. The company also uses AI and sophisticated algorithms to gather insights into user behavior and adjust pricing in response to demand. The global presence in numerous countries and a large number of third-party vendors allow the company to reach a wider audience, increase client trust, and compete with local retailers.

Amazon weaknesses

The main weaknesses include a business model that is simple to copy and inauthentic products. What’s more, the company's dependence on outside vendors creates substantial risks. The possibility of fraud or the sale of poor-quality products on the platform is the key concern, as these factors might negatively affect Amazon's brand image.

Even though Amazon makes significant investments in its delivery infrastructure, there are still occasions when it falls short of consumer expectations, particularly during busy periods of the year and bad weather. Furthermore, Amazon's extensive consumer data collection raises questions about privacy and possible security vulnerabilities. In addition, Amazon's monopoly on the market has sparked worries about potential antitrust violations and anti-competitive behavior.

Amazon opportunities

A significant way to grow Amazon’s client base is to enter new markets . For instance, Amazon can focus on markets with little to no presence, like some countries in South America or Asia. Moreover, the company can engage more third-party sellers to showcase their products on the website and grow the advertising business within the platform.

Besides this, the company can increase the number of its physical stores. Despite having fewer physical locations than other retailers, the firm has been experimenting with other models, including its Amazon Go shops.

Amazon Prime has more than 200 million active subscribers. By spending more on creative content, such as original TV episodes, films, animated series, and documentaries, the company will be able to compete with other large streaming services and draw in more customers. 

Amazon threats

The primary Amazon threats are severe competition and regulatory issues. Since the company operates in various markets, it must make sure that all national and international regulations are followed. This covers laws governing taxes, cross-border trade, labor, and employment practices. Moreover, like other technological companies, Amazon is exposed to cybersecurity threats that can cause the breach of private consumer data, including financial and personal information.

Amazon's extensive supply chain involves interactions with thousands of manufacturers. Thus, any disruption might impact delivery schedules, product availability, and customer satisfaction. It includes challenges like natural catastrophes, delays in manufacturing, traffic congestion, changes in fuel prices, as well as incorrect demand predictions. The other threat is an economic recession, which may affect consumer spending and cause a decline in the company's sales and profitability.

Amazon is an organization that dominates the online retail industry. A large consumer base, a variety of products, and a solid brand identity are some of its strengths. However, the business must also deal with several challenges, such as fierce rivalry, legal problems, and cybersecurity risks. The recommendations for Amazon might include increasing its market presence by opening physical stores, entering developing markets in different countries, and improving technological security measures to address cyber threats and fraud. 

SWOT analysis is one of the most widely used strategic planning methods, but it has several drawbacks. It demonstrates an organization's vulnerabilities and threats as a problem that may do significant harm, as opposed to other analytical techniques that portray them as issues that must be solved. For this reason, let us review the other tools for strategic planning that can help you achieve better results.

SOAR analysis. This framework is similar to SWOT analysis, but it replaces weaknesses and threats with aspirations and results. Aspirations focus on the organization’s objectives, target audience, and geographic scope. The results allow monitoring of the company’s performance and ensuring its objectives are met. SOAR analysis is more suitable for younger companies that are establishing their identity or brand and have yet to understand their weaknesses. 

NOISE analysis. This method enables analysts to estimate the company's situation and develop a strategic improvement plan. The analysis includes needs, opportunities, improvements, strengths, and exceptions. NOISE is more solution-focused than SWOT analysis. Instead of focusing on challenges, such as weaknesses and threats, the framework highlights the resources you need to achieve the goal. The exception emphasizes what a business currently accomplishes in the other four groups.

SCORE analysis. This method comprises strengths, challenges, options, responses, and effectiveness. Similar to SWOT, the SCORE model is adaptable enough to be used for both small projects and comprehensive corporate strategies. The overlap of threats and vulnerabilities in a SWOT analysis may be discouraging. In contrast, SCORE's challenges combine the two elements to help in more constructive problem-solving.

The secret to having a profitable company is establishing and accomplishing goals. SWOT analysis is crucial for assessing objectives and potential paths to success. Work with your team to improve your strategic business planning by identifying your internal strengths and external opportunities.

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Article • 17 min read

SWOT Analysis

Understanding Your Business, Informing Your Strategy

By the Mind Tools Content Team

Key Takeaways:

SWOT stands for S trengths, W eaknesses, O pportunities, and T hreats.

A "SWOT analysis" involves carefully assessing these four factors in order to make clear and effective plans.

A SWOT analysis can help you to challenge risky assumptions, uncover dangerous blindspots, and reveal important new insights.

The SWOT analysis process is most effective when done collaboratively.

What Is a SWOT Analysis?

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT analysis is a technique for assessing these four aspects of your business.

SWOT Analysis is a tool that can help you to analyze what your company does best now, and to devise a successful strategy for the future. SWOT can also uncover areas of the business that are holding you back, or that your competitors could exploit if you don't protect yourself.

A SWOT analysis examines both internal and external factors – that is, what's going on inside and outside your organization. So some of these factors will be within your control and some will not. In either case, the wisest action you can take in response will become clearer once you've discovered, recorded and analyzed as many factors as you can.

In this article, video and infographic, we explore how to carry out a SWOT analysis, and how to put your findings into action. We also include a worked example and a template to help you get started on a SWOT analysis in your own workplace.

Why Is SWOT Analysis Important?

SWOT analysis can help you to challenge risky assumptions and to uncover dangerous blindspots about your organization's performance. If you use it carefully and collaboratively, it can deliver new insights on where your business currently is, and help you to develop exactly the right strategy for any situation.

For example, you may be well aware of some of your organization's strengths, but until you record them alongside weaknesses and threats you might not realize how unreliable those strengths actually are.

Equally, you likely have reasonable concerns about some of your business weaknesses but, by going through the analysis systematically, you could find an opportunity, previously overlooked, that could more than compensate.

How to Write a SWOT Analysis

SWOT analysis involves making lists – but so much more, too! When you begin to write one list (say, Strengths), the thought process and research that you'll go through will prompt ideas for the other lists (Weaknesses, Opportunities or Threats). And if you compare these lists side by side, you will likely notice connections and contradictions, which you'll want to highlight and explore.

You'll find yourself moving back and forth between your lists frequently. So, make the task easier and more effective by arranging your four lists together in one view.

A SWOT matrix is a 2x2 grid, with one square for each of the four aspects of SWOT. (Figure 1 shows what it should look like.) Each section is headed by some questions to get your thinking started.

Figure 1. A SWOT Analysis Matrix.

Swot analysis template.

When conducting your SWOT analysis, you can either draw your own matrix, or use our free downloadable template .

How to Do a SWOT Analysis

Avoid relying on your own, partial understanding of your organization. Your assumptions could be wrong. Instead, gather a team of people from a range of functions and levels to build a broad and insightful list of observations.

Then, every time you identify a Strength, Weakness, Opportunity, or Threat, write it down in the relevant part of the SWOT analysis grid for all to see.

Let's look at each area in more detail and consider what fits where, and what questions you could ask as part of your data gathering.

Strengths are things that your organization does particularly well, or in a way that distinguishes you from your competitors. Think about the advantages your organization has over other organizations. These might be the motivation of your staff, access to certain materials, or a strong set of manufacturing processes.

Your strengths are an integral part of your organization, so think about what makes it "tick." What do you do better than anyone else? What values drive your business? What unique or lowest-cost resources can you draw upon that others can't? Identify and analyze your organization's Unique Selling Proposition (USP), and add this to the Strengths section.

Then turn your perspective around and ask yourself what your competitors might see as your strengths. What factors mean that you get the sale ahead of them?

Remember, any aspect of your organization is only a strength if it brings you a clear advantage. For example, if all of your competitors provide high-quality products, then a high-quality production process is not a strength in your market: it's a necessity.

Weaknesses, like strengths, are inherent features of your organization, so focus on your people, resources, systems, and procedures. Think about what you could improve, and the sorts of practices you should avoid.

Once again, imagine (or find out) how other people in your market see you. Do they notice weaknesses that you tend to be blind to? Take time to examine how and why your competitors are doing better than you. What are you lacking?

Be honest! A SWOT analysis will only be valuable if you gather all the information you need. So, it's best to be realistic now, and face any unpleasant truths as soon as possible.

Opportunities

Opportunities are openings or chances for something positive to happen, but you'll need to claim them for yourself!

They usually arise from situations outside your organization, and require an eye to what might happen in the future. They might arise as developments in the market you serve, or in the technology you use. Being able to spot and exploit opportunities can make a huge difference to your organization's ability to compete and take the lead in your market.

Think about good opportunities that you can exploit immediately. These don't need to be game-changers: even small advantages can increase your organization's competitiveness. What interesting market trends are you aware of, large or small, which could have an impact?

You should also watch out for changes in government policy related to your field. And changes in social patterns, population profiles, and lifestyles can all throw up interesting opportunities.

Threats include anything that can negatively affect your business from the outside, such as supply-chain problems, shifts in market requirements, or a shortage of recruits. It's vital to anticipate threats and to take action against them before you become a victim of them and your growth stalls.

Think about the obstacles you face in getting your product to market and selling. You may notice that quality standards or specifications for your products are changing, and that you'll need to change those products if you're to stay in the lead. Evolving technology is an ever-present threat, as well as an opportunity!

Always consider what your competitors are doing, and whether you should be changing your organization's emphasis to meet the challenge. But remember that what they're doing might not be the right thing for you to do. So, avoid copying them without knowing how it will improve your position.

Be sure to explore whether your organization is especially exposed to external challenges. Do you have bad debt or cash-flow problems, for example, that could make you vulnerable to even small changes in your market? This is the kind of threat that can seriously damage your business, so be alert.

Use PEST Analysis to ensure that you don't overlook threatening external factors. And PMESII-PT is an especially helpful check in very unfamiliar or uncertain environments.

A SWOT Analysis Example

Imagine this scenario: a small start-up consultancy wants a clear picture of its current situation, to decide on a future strategy for growth. The team gathers, and draws up the SWOT Analysis shown in Figure 2.

Figure 2. A Completed SWOT Analysis.

As a result of the team's analysis, it's clear that the consultancy's main strengths lie in its agility, technical expertise, and low overheads. These allow it to offer excellent customer service to a relatively small client base.

The company's weaknesses are also to do with its size. It will need to invest in training, to improve the skills base of the small staff. It'll also need to focus on retention, so it doesn't lose key team members.

There are opportunities in offering rapid-response, good-value services to local businesses and to local government organizations. The company can likely be first to market with new products and services, given that its competitors are slow adopters.

The threats require the consultancy to keep up-to-date with changes in technology. It also needs to keep a close eye on its largest competitors, given its vulnerability to large-scale changes in its market. To counteract this, the business needs to focus its marketing on selected industry websites, to get the greatest possible market presence on a small advertising budget.

Frequently Asked Questions About SWOT Analysis

1. who invented swot analysis.

Many people attribute SWOT Analysis to Albert S. Humphrey. However, there has been some debate on the originator of the tool, as discussed in the International Journal of Business Research .

2. What Does SWOT Analysis Stand For?

SWOT Analysis stands for Strengths, Weaknesses, Opportunities and Threats.

3. What Can a SWOT Analysis Be Used For?

SWOT analysis is a useful tool to help you determine your organization's position in the market. You can then use this information to create an informed strategy suited to your needs and capabilities.

4. How Do I Write a SWOT Analysis?

To conduct a SWOT analysis, you first need to create a 2x2 matrix grid. Each square is then assigned to one of the four aspects of SWOT. You can either draw this grid yourself or use our downloadable template to get started.

5. How Do SWOT Analysis and the TOWS Matrix compare?

While SWOT analysis puts the emphasis on the internal environment (your strengths and weaknesses), TOWS forces you to look at your external environment first (your threats and opportunities). In most cases, you'll do a SWOT Analysis first, and follow up with a TOWS Matrix to offer a broader context.

6. What Are the Biggest SWOT Analysis Mistakes?

• Making your lists too long. Ask yourself if your ideas are feasible as you go along.
• Being vague. Be specific to provide more focus for later discussions.
• Not seeing weaknesses. Be sure to ask customers and colleagues what they experience in real life.
• Not thinking ahead. It's easy to come up with nice ideas without taking them through to their logical conclusion. Always consider their practical impact.
• Being unrealistic. Don't plan in detail for opportunities that don't exist yet. For example, that export market you've been eyeing may be available at some point, but the trade negotiations to open it up could take years.
• Relying on SWOT Analysis alone. SWOT Analysis is valuable. But when you use it alongside other planning tools (SOAR, TOWS or PEST), the results will be more vigorous.

How to Use a SWOT Analysis

Use a SWOT Analysis to assess your organization's current position before you decide on any new strategy. Find out what's working well, and what's not so good. Ask yourself where you want to go, how you might get there – and what might get in your way.

Once you've examined all four aspects of SWOT, you'll want to build on your strengths, boost your weaker areas, head off any threats, and exploit every opportunity. In fact, you'll likely be faced with a long list of potential actions.

But before you go ahead, be sure to develop your ideas further. Look for potential connections between the quadrants of your matrix. For example, could you use some of your strengths to open up further opportunities? And, would even more opportunities become available by eliminating some of your weaknesses?

Finally, it's time to ruthlessly prune and prioritize your ideas, so that you can focus time and money on the most significant and impactful ones. Refine each point to make your comparisons clearer. For example, only accept precise, verifiable statements such as, "Cost advantage of $30/ton in sourcing raw material x," rather than, "Better value for money."

Remember to apply your learnings at the right level in your organization. For example, at a product or product-line level, rather than at the much vaguer whole-company level. And use your SWOT analysis alongside other strategy tools (for example, Core Competencies Analysis ), so that you get a comprehensive picture of the situation you're dealing with.

SWOT Analysis Tips

Here are four tips for getting more out of a SWOT analysis:

• Be specific. The more focused and accurate you are about the points you write down, the more useful your SWOT analysis will be.
• Work backwards. Experiment with filling in the four sections of your SWOT analysis in a different order, to stimulate new ways of thinking. Working backwards, in particular, from threats to strengths, may cast new light on the situation.
• Get together. Highlight the most useful people to contribute to your SWOT analysis, then gather information and ideas from them all.
• SWOT your competition ! To stay ahead of your competitors, carry out a regular SWOT analysis on them . Use everything you know about them to evaluate their situation, and use SWOT analysis to plan your competitive strategies accordingly.

It's also possible to carry out a Personal SWOT Analysis . This can be useful for developing your career in ways that take best advantage of your talents, abilities and opportunities.

SWOT Analysis Infographic

See SWOT Analysis represented in our infographic :

SWOT Analysis helps you to identify your organization's Strengths, Weaknesses, Opportunities, and Threats.

It guides you to build on what you do well, address what you're lacking, seize new openings, and minimize risks.

Apply a SWOT Analysis to assess your organization's position before you decide on any new strategy.

Use a SWOT matrix to prompt your research and to record your ideas. Avoid making huge lists of suggestions. Be as specific as you can, and be honest about your weaknesses.

Be realistic and rigorous. Prune and prioritize your ideas, to focus time and money on the most significant and impactful actions and solutions. Complement your use of SWOT with other tools.

Collaborate with a team of people from across the business. This will help to uncover a more accurate and honest picture.

Find out what's working well, and what's not so good. Ask yourself where you want to go, how you might get there – and what might get in your way.

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Comments (2)

SWOT is useless. When you try it and you find Weaknesses box bulging, but Strengths & Opportunities completely empty, what can that possibly achieve?

Leslie Bartnicki

The love of my life for 15 years was diagnosed 2 years ago at age 54. Symptoms were tremor in right leg, loss of handwriting ability, and soft voice. He also have difficulty rising from a seated position and have balance issues. he started out taking only Azilect, then Mirapex, and 6 months ago Sinemet. Several months ago he started falling frequently, hence the reason for Sinemet. We tried every shots available but nothing worked. In March 2023, my neurologist and I decided to go with natural treatment and was introduced to Natural Herbs Centre Ayurvedic organic Parkinson’s protocol, he had a total decline of symptoms with this treatment, the Tremor, falling frequently, stiffness, body weakness, balance issues, depression and others has subsided. Visit Natural Herbs Centre official website naturalherbscentre. com. This treatment is a breakthrough for all suffering from Parkinson’s, don’t give up Hope. Keep Sharing the Awareness, herbs are truly gift from God. I can personally vouch for these remedy but you would probably need to decide what works best for you

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SWOT Analysis Examples: From Small Businesses to Startups and Large Corporations

Jennifer Cameron - Guest Contributor

Discover how a SWOT analysis is crucial to decision-making for businesses of all sizes.

Knowing where you stand in today’s business landscape is crucial for sustained growth and competitiveness. A SWOT analysis is a strategic tool for businesses to gain insights into their internal and external environments. The acronym stands for:

/ What does SWOT stand for?

S: Strengths

W: Weaknesses

O: Opportunities

What is a SWOT analysis?

A SWOT analysis is a strategic evaluation [ 1 ] used by organizations to review their internal Strengths and Weaknesses alongside their external Opportunities and Threats. This analysis is pivotal for businesses of all sizes as it helps inform decision-making and strategy formulation, ensuring businesses build or maintain a competitive stance.

What are the benefits of a SWOT analysis?

A SWOT analysis isn’t merely a theoretical exercise [ 2 ] —it’s a practical tool with tangible benefits.

Some key advantages of conducting a SWOT analysis include:

   Improved decision-making

By delineating strengths, weaknesses, opportunities, and threats, businesses can make well-informed decisions that align with the organization’s objectives. This direct address of internal and external factors significantly reduces risks associated with ill- or misinformed decision-making.

   Resource optimization

Identifying strengths and weaknesses helps businesses more efficiently allocate resources, whether those resources are human, financial, or technological, directly addressing the common business challenge of wasted resources.

   Improved risk management

Recognizing external threats and internal weaknesses can help companies develop and implement robust risk management strategies and minimize potential adversities.

   Enhanced strategic planning

SWOT analysis provides a deeper understanding of the business environment, which is instrumental in developing sound strategic plans. Enhanced planning skills help businesses directly address the challenges of navigating a competitive marketplace.

   Increased competitive advantage

Enhanced planning capabilities and an increased competitive advantage can capitalize on strengths and opportunities identified in the analysis, build a stronger position, and become more distinctly competitive.

How to write a SWOT analysis: A 4-step guide with real-world SWOT analysis examples

Running a SWOT analysis is a strategic move for any business that wants a more comprehensive understanding of its internal and external environments. But, how do you perform a SWOT analysis without an example of a SWOT analysis? What real-world aspects of your business should you review? SWOT analysis helps businesses fortify their strategies by leveraging strengths and opportunities while addressing weak spots and mitigating potential threats.

The steps below are followed by real-world SWOT analysis examples using various industries at varying stages of business growth. All of these SWOT analysis examples illustrate a real-world aspect of a business that management should review at that step.

Step 1. Identify your strengths

Evaluate the internal assets and advantages your business holds.

SWOT analysis examples: 

A startup SaaS provider has a highly skilled development team, and is working on establishing a reputation for delivering on-time, reliable software solutions.

A small-to-midsize eCommerce business that sells discount products has a dedicated staff and a steady stream of regular customers.

A large manufacturing company employs the brightest engineers and holds patents for several manufacturing tools and machines.

Step 2. Pinpoint your weak spots​

Assess the internal limitations and areas that require improvement.

The B2B startup's customer support could be better. But with so few staff members, response time is lagging, leading to a degree of client dissatisfaction.

The midsize B2C eCommerce business experienced a huge growth spurt requiring additional warehouse space and employees, but the growth signals weren't identified in time, which led to dissatisfaction amongst loyal customers.

The corporate manufacturer experienced a series of setbacks, including safety issues that led to injuries and the loss of several major clients.

Step 3: Know how to spot opportunities

Examine the external environment for potential growth prospects.

The market continues trending towards cloud-based options, presenting an opportunity for the SaaS startup to capitalize on the trend and expand to include cloud-based solutions.

Because the initial growth spurt wasn't recognized, it hurt the B2C eCommerce business slightly, giving competitors some market share. Management has decided to rollback growth plans for now, focus on current customer satisfaction, and plan a more executable growth strategy for the future.

The large manufacturer, while having taken a severe blow, spots a current trend that no one else seems to have noticed and begins planning how to capitalize on it and begin recapturing lost contracts and building new relationships.

Step 4: Identify potential external threats

Look into external challenges that might hinder your business's success.

New competitors are emerging with similar tools, aggressive pricing strategies, and more robust customer service, posing a significant threat to the SaaS provider’s market share.

The eCommerce business notices sales are slumping during what's normally its busiest quarter. Established competitors and eCommerce startups could force ownership to close the doors if unique and timely strategies aren't arranged soon.

With the loss of many of its major contracts and a lead funnel that's slowed to a trickle, other large scale corporations are trying to entice the manufacturing company's top engineers to come work at their businesses.

This brief step-by-step guide with SWOT analysis examples offers a structured framework for any business to conduct a thorough SWOT analysis, paving the way for informed strategic planning.

What kind of business should consider performing a SWOT analysis?

A SWOT analysis is a useful tool that’s relevant for businesses regardless of size or industry. Whether a startup, a small to midsize business (SMB), or a large corporation, the insights gathered from a SWOT analysis are invaluable. Here’s a closer look at how a SWOT analysis applies across different business sectors:

Regardless of size or industry, a SWOT analysis can offer a well-rounded understanding of the business environment. It’s particularly beneficial for technology-driven sectors, where success is driven by trends.

Prepare your business for a SWOT analysis

A well-executed SWOT analysis can unveil insightful data, aiding in informed decision-making. Here are some tips an SMB should consider to prepare for and execute a SWOT analysis:

Gather a diverse team with various perspectives.

Collect appropriate data for an accurate appraisal.

Be objective, open to criticisms, and allow diverse opinions.

Use technological tools to collect data, perform analysis, and collaborate.

Stay up to date on market trends.

It’s important to thoroughly prepare before carrying out a SWOT analysis so your insights are more accurate and, therefore, useful. The results of your analysis can inform future strategies and overall planning.

Use SWOT analysis to align your organization with your business goals

A SWOT analysis is a powerful tool for a business eager to carve its niche in a competitive market.

For a closer look at strategic business analysis, consider the following resources:

Sales Trailblazer Shares Her Secrets for Driving Business Growth Through Inclusive Sales

How To Improve Manager Effectiveness

CX Influencer Shares Tips for How To Build Customer Loyalty Today

The path to success is paved with decisions— good decisions . Supplement your SWOT analysis with these insightful resources.

SWOT Analysis Applications: An Integrative Literature Review , Journal of Global Business Insights

SWOT Analysis: A Theoretical Review , DSpace 

The Origins of SWOT Analysis , ScienceDirect

Was this article helpful?

About the author.

Jennifer Cameron is a writer/editor and business process analyst specializing in sales, marketing, and eCommerce topics for B2B and B2C clients. Her work has helped small and midsize business owners on sites such as Capterra and various Fortune 1000 technology vendors.

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Home » blog » Understand SWOT Analysis With 3 Examples – Netflix, Pepsico & Starbucks

Understand SWOT Analysis With 3 Examples – Netflix, Pepsico & Starbucks

Brand marketing is an ancient art form. Did you know ancient civilizations would stamp their goods for customers to guarantee the quality? That was probably the earliest form of cultivating brand loyalty. 

Then came the printing press. With it, we entered the age of pamphlets, posters and paper-centric information. 

With mass media, brands made an appearance everywhere. Outside your window on a billboard, next to your favorite newspaper crossword and in between your favorite TV show. 

If you follow the trail, brands go where the customers are. When the consumer moved online, all companies followed suit. We are now in the age of digital marketing. It’s an advanced form of the marketing industry that uses sophisticated techniques and technology to reach the target customer. Unlike earlier, you no longer have to shout from the rooftops about your brand. Now you can quietly slip into someone’s email or cleverly catch their attention through social media algorithms. In 2022, five billion people were on the internet. With digital marketing, not only can you effectively reach out to this massive number, but you can also personalize the message to have a significant impact. It also helps to perform a SWOT analysis in marketing as it always helps to understand your company better and enhance productivity. 

What Is Digital Marketing?

Digital marketing is a form of online communication that uses different electronic media to promote brands and spread messages. People are constantly on their phones, tablets or computers. Look around, and you’ll see eyeballs glued to phone screens everywhere. That tiny piece of digital space is prime marketing real estate. You can use it to showcase ads, banners, links, direct emails and social media posts that are tailor-made to appeal to the customer. It’s an exciting opportunity to be creative yet precise. You can fine-tune your strategy to appeal to specific consumers. It is a fantastic way to generate interest in your products among potential customers as you create a unique connection. 

Read more about Digital Marketing

Why Do Digital Marketing Agencies Use SWOT Analysis? 

The competition between brands has never been more fierce. If you want the online user to prefer your brand and be a loyal customer, you need a structured system to form your strategy. That is what SWOT is all about. Here is the SWOT full form in marketing:

Opportunities 

SWOT isn’t a new tool. It has already been implemented by companies the world over. However, it has also proven useful when it comes to digital marketing. It is a valuable method to help your business become successful and stay ahead of the competition. 

What is SWOT analysis? 

The SWOT method can help you create a long-term digital marketing strategy that works. It is essential to ask the right questions when doing the analysis. 

Internal factors

• What is the company’s USP?
• What is the quality of services compared to other businesses?
• How strong is our brand recall?
• Do we have a strong clientele?

Weaknesses 

• In which areas are we lacking productivity? 
• Where are we falling behind our competition?
• What complaints have we received?
• Any internal limitations are affecting our targets?

External factors  

• Will the new product fill in a gap in the market?
• Can we reach out to a larger audience? 
• Is there a faster, more efficient way to increase numbers?
• Is new technology affecting our business?
• Are new products in the market taking our customers?
• Is there a lack of resources due to unforeseen circumstances? 

Benefits Of Doing A SWOT Analysis In Marketing

• You can build an efficient model that helps you accurately gauge the business performance
• Analyze the organization’s internal and external strengths 
• You learn how to increase visibility in the market
• Develop a plan of action that is implemented when needed 
• Discover new areas of opportunities 
• You can understand your business position in the market better, especially when compared to the competition
• You solve customer problems and business-related challenges 
• Understand where the company needs improvement 

Case studies for SWOT Analysis in digital marketing

The electronic transformation of businesses has created a paradigm shift in how companies are run. You need a high-powered digital strategy to optimize your presence across all online channels. Here are a few major companies that have successfully used product SWOT analysis to enhance their digital marketing campaign. 

As one of the most viewed OTT platforms, Netflix has nearly 200 million subscribers all over the world. However, they are facing a lot of competition from other streaming services and have lost quite a few subscriptions in 2022. Here is the SWOT analysis for Netflix: 

• The streaming service enjoys a strong reputation worldwide and has a big name in the market 
• Award-winning, original content across various genres that is customized to every region 
• Flexible services
• Uses data analytics to create algorithms for personalized recommendations 
• The user-centric strategy aimed at keeping the customers happy 
• Available across different media platforms such as phones, tablets and laptops
• Uses SEO, social media channels and emails to attract and retain customers 
• Prime content is largely aimed at the North American region and needs to improve quality for non-English speaking areas 
• Limited copyright issues which affect their profits 
• Weak customer service department that influences consumer satisfaction 
• Pricing is higher than the competition
• Increasing debt 

OPPORTUNITIES 

• Can enter other digital domains such as gaming, VR, interactive channels, etc. 
• Tie up with production companies in various countries and encourage new talent to create high-quality yet localized content
• Improve social media presence by collaborating with influencers, celebrities and industry giants 
• Create an innovative digital marketing strategy to promote content and create hype
• Use algorithms to personalize direct emails to every customer 
• Introduce an advertising-based model to increase revenue 
• Losing subscribers to cheaper services like Amazon Prime and Disney+, YouTube
• Stricter government rules in some countries can affect the content streamed there 
• Saturated markets as subscription rates have slowed down 
• Piracy over Netflix shows occurs all over the world, leading to several losses 

What started as a beverage company to rival Coca-Cola, is now a multi-brand, diversified food giant with a steady hold over the market in many countries. However, the packaged food industry is saturated with many products. Can the company continue to command such a large share of market value?

Here is the SWOT analysis for PepsiCo: 

• Overwhelming global presence in over 200 countries 
• Occupies a dominant position in all major outlets, such as restaurants, supermarkets, vending machines, etc.
• Known for its award-winning advertising and traditional marketing strategies 
• Targets the younger generation 
• Excellent supply chain management system that reduces production costs 
• Partners with major sports events and hires famous celebrities as brand ambassadors 

WEAKNESSES 

• The entire portfolio of products is in the ‘unhealthy’ classification, therefore a large section of the target audience, i.e. children, are not allowed to indulge often
• Spends too much money on retaining big celebrities, TV ads and other forms of traditional media 
• Are responsible for contributing to major environmental issues such as excess plastic production, water and air pollution, etc. 
• Have quite a few failed products in their kitty, such as Pepsi Blue
• The company has been in several controversies over the years, which has tarnished their reputation 
• Expanding their presence online through various e-commerce platforms 
• Increase research and development funding in the health food sector of the industry 
• Adapt to changing trends by introducing newer flavors and updating older packaging to appeal to a younger audience 
• Most of the younger generation is now found online
• Explore options to connect with target audiences through social media ads, online content sponsorships, banners and emails
• Hire digital content creators to add value to PepsiCo’s online presence 
• Tie up with online food brands or food delivery apps 
• There is intense competition in the food and beverage industry
• Many consumers are moving towards a healthier lifestyle and are well aware of the harmful effects of excess salt and sugar 
• If PepsiCo doesn’t adapt to newer technology and changes in the marketplace, it will lose out to stronger competitors 
• Government regulations about ‘unhealthy’ foods can affect their business 
• Demographics are changing as some countries have a higher population of older people which is not PepsiCo’s target audience 
• Sales are hit during economic crises and recessions

A multinational chain of coffeehouses that is also a multi-billion dollar enterprise, Starbucks is a textbook corporate success story. The organization took the humble cup of coffee and transformed it into an addictive experience. However, can they make as much of an impact with most of their customers shopping online? 

Here is the SWOT analysis for Starbucks:

• Loyal customers who are devoted to buying Starbucks products 
• A wide selection of premium beverages and edibles 
• Cool, urban vibe that appeals to most coffee drinkers 
• Huge presence and a strong reputation around the world 
• Continues to be a profitable venture 
• There are a lot of newer, cheaper options available on the local level in several countries 
• The company is subjected to different government regulations and tax laws that exist in other nations
• It can be a challenge to procure coffee beans at competitive prices, especially from other countries 
• The menu needs to change periodically to ensure customers don’t tire of the brand

OPPORTUNITIES

• The Asian markets are an untapped segment and prime for expansion 
• Moving to online delivery apps can help reach a wider net of customers 
• Direct marketing methods such as social media tie-ups and emailers can keep the customer aware of new products and discounts 
• Use data analytics to observe the more popular, trending products and capitalize on them 
• Other multinational fast-food chains such as Mcdonald’s offer cheaper coffee 
• The younger generation prefers healthier or vegan options for hot beverages 
• Too many sugary drinks or salty foods can be considered a ‘health hazard’ 
• The lack of a strong digital presence can cause the brand to lose some of its value

About The Digital Marketing Course 

If you want to be the next big thing in digital marketing, you need to do a course and get certified first. A digital marketing qualification teaches you industry-centric knowledge and skills to master the genre. Once you receive your certificate, you can work in any company. Almost all organizations are now online or are getting there. As a digital marketing specialist, you will be in great demand.

Course Syllabus

Here are some of the topics that are covered in the digital marketing certification

• Internet marketing foundation
• Paid Search Marketing
• Display Advertising
• Email Marketing
• Social Media

Why Proschool’s Digital Marketing Course Is One Of TheBest

A good coaching center helps you holistically prepare for the digital marketing course . Proschool has a wide range of resources, innovative teaching methods and a stellar faculty to ensure you are well-equipped to join the industry. The institute has adopted active learning methods, so the students learn from real-world examples. The students are put together in groups and work as a team. The onus is to learn by ‘doing’. There is also a strong focus on skill development. Once you finish the course, you are eligible to apply for six certifications by Google, Facebook, LinkedIn, etc. 

Course highlights:

• There is a 3-week that spans 20 hours 
• The 3-month course has an 80-hour duration
• You receive an NSDC certification with the 3-month program 
• You can attend weekend classes or do the course online 
• The coaching classes cover all the subjects, including case studies using SWOT analysis 
• On completion, Proschool offers all its students job placement assistance 
• You are well-trained in digital marketing and ready to apply for any entry-level job

In Conclusion 

Digital marketing is here to stay. Traditional companies are fast making a move online while new start-ups begin their journey in cyberspace. To help businesses grow, a SWOT analysis of digital marketing is an important tool. It draws focus on the key points of the company and areas where improvement is needed. You can do it at any time, for any reason. And the results will help you achieve your targets. 

Find out more about the digital marketing course here

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Netflix SWOT Analysis

Before we dive deep into the SWOT analysis, let’s get the business overview of Netflix. Netflix is a popular American media services provider and production company founded in 1997. It offers a subscription-based streaming service that allows users to watch a wide range of TV shows, movies, documentaries, and more on internet-connected devices.

Netflix has expanded its services globally and is now available in over 190 countries. In addition to offering content from various studios and networks, Netflix also produces its own original programming, which has gained critical acclaim and popular success.

Some of Netflix’s most popular original shows include Stranger Things, The Crown, Narcos, Orange is the New Black, and House of Cards. Netflix has also produced successful original movies like Roma, Bird Box, and Marriage Story.

To access Netflix’s streaming service, users can subscribe to one of several membership plans, which vary in price based on the number of simultaneous streams and the video quality. Users can watch Netflix on smart TVs, smartphones, tablets, laptops, and gaming consoles.

Netflix – Constantly Pivoting its Business Model to Success

Here is the SWOT analysis for Netflix

A SWOT analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats of a business, project, or individual. It involves identifying the internal and external factors that can affect a venture’s success or failure and analyzing them to develop a strategic plan. In this article, we do a SWOT Analysis of Netflix.

By the way, here is a course that will help you stand out in the world of strategy. The Strategic Thinking program for CxO by Cambridge Judge Business School maps your competitive advantage and teaches advanced techniques to formulate, evaluate, and execute winning strategies. Generate winning strategies and learn how to renew them in times of crisis for a competitive advantage.

SWOT Analysis: Meaning, Importance, and Examples

Netflix has several strengths that have contributed to its success as a company:

• Extensive content library : Netflix has a vast library of TV shows, movies, and documentaries from various studios and networks. This comprehensive collection of content provides users with a wide range of options to choose from.
• Original programming : Netflix has invested heavily in producing its own original programming. This has given the company an edge in the highly competitive streaming market and has helped it differentiate itself from other streaming services.
• Global reach : Netflix is available in over 190 countries, which gives the company a massive audience and revenue potential. This global presence has also helped Netflix to attract international talent and expand its content offerings.
• User-friendly interface : Netflix’s platform is easy to use and navigate. Users can quickly search for and find the content they want to watch, and the platform’s personalized recommendations make it easy for users to discover new shows and movies.
• Data-driven approach : Netflix uses data analytics to track user behavior and preferences. This enables the company to provide personalized recommendations and create content that resonates with its audience.
• Innovative technology : Netflix has invested in developing new technologies that improve the user experience, such as its adaptive streaming technology, which adjusts video quality based on internet speed.
• Brand recognition : Netflix has built a strong brand associated with high-quality content and a commitment to innovation. This has helped the company to attract new subscribers and retain existing ones.

While Netflix is a highly successful company, it also faces several weaknesses:

• Dependence on licensing agreements : Although Netflix has been producing more original content, it still relies heavily on licensing agreements with studios and networks to offer popular TV shows and movies. This leaves Netflix vulnerable to losing content if licensing agreements are not renewed or if studios decide to pull their content.
• High content production costs : Producing original content can be expensive, and Netflix has spent billions of dollars on developing and producing its original programming. This high cost can make it difficult for Netflix to maintain profitability.
• Regional content restrictions : Netflix’s content library varies by region due to licensing agreements and regulations. This can lead to inconsistencies in the content available to users in different countries, frustrating subscribers.
• Subscription model : Netflix’s business model is based on subscriptions, which means it relies on a steady flow of new subscribers to maintain revenue growth. This can be challenging as competition in the streaming market increases and other companies offer similar services.
• Limited advertising revenue : Netflix does not show traditional ads on its platform, which limits its advertising revenue potential. While this may appeal to subscribers, it also means that the company must rely solely on subscription revenue to generate income.

Netflix: Thriving on a Maverick Culture

By the way, to communicate our strategy effectively within the team, we all need a robust collaboration platform. Miro is the leading visual collaboration platform. Build anything together on Miro. It’s free and as easy to use as a whiteboard , but endlessly more powerful. Do use the Miro platform for strong communication within your team.

Opportunities

Netflix has several opportunities that it can capitalize on to maintain its growth and success:

• International expansion : Netflix has already expanded its services to over 190 countries, but there is still room for growth in some regions. By expanding globally, Netflix can tap into new markets and increase its subscriber base.
• Original content production : Netflix’s original content has been highly successful, and the company has an opportunity to produce more high-quality shows and movies that attract a broad audience. This will enable Netflix to continue differentiating itself from other streaming services.
• Strategic partnerships : Netflix can form alliances with other companies to offer additional value to subscribers. For example, partnerships with internet service providers can offer bundled services that include both internet and Netflix subscriptions.
• Merchandising : Netflix has a large and passionate fan base, and the company has an opportunity to monetize this by offering merchandise related to its popular shows and movies. This can include clothing, toys, and other products that appeal to fans.
• Interactive content : Interactive content, such as the Black Mirror episode “Bandersnatch,” has become increasingly popular with audiences. Netflix can continue exploring this format and offer subscribers more interactive shows and movies.
• Expansion into new areas: Netflix can also explore opportunities in new areas, such as video games or virtual reality. This can help the company diversify its offerings and attract new audiences.
• Product placement : Product placement refers to the subtle promotion of brands or products by making them part of the story. Netflix recently tried this in Emily in Paris, season 3, with McDonald’s. ( Fans were not happy, though .)

Netflix faces several threats that could impact its growth and success:

• Increased competition : Streaming services such as Amazon Prime Video, Disney+, HBO Max, and Apple TV+ compete for viewers’ attention and subscriptions. The increasing number of options can make it challenging for Netflix to attract and retain subscribers.
• Piracy : Online piracy is a significant threat to Netflix’s business model, as users can access pirated content for free. This can lead to lost revenue for Netflix and a decline in its subscriber base.
• Changes in content licensing : Netflix relies heavily on licensing agreements with studios and networks to offer popular TV shows and movies. Changes in these agreements or the emergence of new licensing models could impact Netflix’s content offerings and its ability to attract subscribers.
• Technological advancements : Technological advancements in streaming technology, virtual reality, and artificial intelligence can disrupt Netflix’s business model and require the company to adapt quickly.
• Economic downturn : Economic downturns can impact Netflix’s revenue growth, as consumers may prioritize their spending differently during challenging economic times.
• Government regulations : Governments around the world are increasingly regulating the streaming industry. Regulation changes like tax laws or content restrictions could impact Netflix’s operations in certain regions.

Check out the SWOT Analysis of Global Businesses

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SWOT Analysis

• Support your understanding of the SWOT Analysis to...
• 1 When to use a SWOT analysis
• 2 Exploring the environment of a project
• 3.1 Strengths and weaknesses
• 3.2 Opportunities and threats
• 4 Completing the SWOT analysis

5.1 SWOT analysis: a case study

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Read through the case study and SWOT Analysis Template, then try to complete the activity below.

Case study 1: Syed’s business opportunity

Syed runs his own enterprise in an area on the outskirts of Dhaka, Bangladesh. He manages a collective of people with disabilities who make Bangladeshi puppets in a traditional style, mainly selling to tourists through local shops, and pays them a basic salary as well as a profit share. The puppets are all made to Syed’s own designs, and are quite different to the standard items in most tourist stores. His quirky designs and their popularity with shoppers have come to the attention of Muhammad, who runs a relatively large factory producing puppets and other tourist-friendly wares. Muhammad approaches Syed to suggest that he buy his enterprise, including his designs, and that Syed and his employees all come and work at Muhammad’s factory. He is offering a lot of money, and Syed doesn’t know whether he wants to maintain his independence or go for the security offered by a lump cash sum and guaranteed employment. He uses a SWOT analysis to take a snapshot of his current situation and help him consider the decision:

Looking at the case study above, including Syed’s SWOT analysis, imagine you are helping Syed make his decision. What points would you highlight? Would you recommend him to sell to Muhammad? Make some notes in answer to this question in the text box below.

Syed has provided some interesting information in his SWOT analysis. By taking a realistic look at his business as it is, he can decide what is most likely to make sense for its future. There’s no absolute right or wrong here (there rarely is in this sort of decision-making), but based on the information given I would advise Syed not to sell. These are the key points I would highlight:

• Syed has a lot of strengths, mainly based on the very fact that the organisation is small and under his management.
• Being dependent on one supplier is always a risk, especially now they are becoming unreliable. However, there’s no reason he couldn’t identify other suppliers and shop around to get a good deal and spread the risk by regularly using two or three.
• Syed has said that cash flow is a weakness that stops him from expanding. It sounds like now would be a great time to explore the financial support from the new NGO, as this would enable him to respond to some of the other opportunities (new shops and the potential for export) at his own pace and under his control.
• If he expands, perhaps he could take on some new employees part time? If he has, say, four employees who work half time rather than two who work full time, he has spread the risk of his dependency – if someone is ill or leaves, one or more of the others might be able to increase their hours.
• If he agrees to Muhammad’s offer, he will lose his independence and have to commute to a different workplace. Will the people he works with be able to commute, or in practical terms will this mean they become unemployed (and how might he feel about that)? More people will see and buy his designs, but will his name or mark be on them?
• What if he explores the opportunities for expansion that the SWOT analysis has highlighted, and then considers whether the offer looks tempting?

Finally, I would perhaps suggest that this isn’t a yes or no decision, and there might be a way that Syed could maintain all his strengths but still work in partnership with Muhammad. He could create some designs especially for Muhammad’s factory, and/or draw on some of his resources in exchange for design expertise. At this point, a SWOT analysis of the potential partnership could be a useful decision-making tool.

5 Using the SWOT analysis for decision making

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What Is SWOT Analysis?

Understanding swot analysis, how to do a swot analysis, the bottom line.

• Fundamental Analysis

SWOT Analysis: How To With Table and Example

These frameworks are essential to fundamentally analyzing companies

Ariel Courage is an experienced editor, researcher, and former fact-checker. She has performed editing and fact-checking work for several leading finance publications, including The Motley Fool and Passport to Wall Street.

SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework used to evaluate a company's competitive position and to develop strategic planning. SWOT analysis assesses internal and external factors, as well as current and future potential.

A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the strengths and weaknesses of an organization, initiatives, or within its industry. The organization needs to keep the analysis accurate by avoiding pre-conceived beliefs or gray areas and instead focusing on real-life contexts. Companies should use it as a guide and not necessarily as a prescription.

Subscribe to 'Term of the Day' and learn a new financial term every day. Stay informed and make smart financial decisions. Sign up now .

Key Takeaways

• SWOT analysis is a strategic planning technique that provides assessment tools.
• Identifying core strengths, weaknesses, opportunities, and threats leads to fact-based analysis, fresh perspectives, and new ideas.
• A SWOT analysis pulls information internal sources (strengths of weaknesses of the specific company) as well as external forces that may have uncontrollable impacts to decisions (opportunities and threats).
• SWOT analysis works best when diverse groups or voices within an organization are free to provide realistic data points rather than prescribed messaging.
• Findings of a SWOT analysis are often synthesized to support a single objective or decision that a company is facing.

Investopedia / Xiaojie Liu

SWOT analysis is a technique for assessing the performance, competition, risk, and potential of a business, as well as part of a business such as a product line or division, an industry, or other entity.

Using internal and external data , the technique can guide businesses toward strategies more likely to be successful, and away from those in which they have been, or are likely to be, less successful. Independent SWOT analysts, investors, or competitors can also guide them on whether a company, product line, or industry might be strong or weak and why.

SWOT analysis was first used to analyze businesses. Now, it's often used by governments, nonprofits, and individuals, including investors and entrepreneurs. There is seemingly limitless applications to the SWOT analysis.

Components of SWOT Analysis

Every SWOT analysis will include the following four categories. Though the elements and discoveries within these categories will vary from company to company, a SWOT analysis is not complete without each of these elements:

Strengths describe what an organization excels at and what separates it from the competition : a strong brand, loyal customer base, a strong balance sheet, unique technology, and so on. For example, a hedge fund may have developed a proprietary trading strategy that returns market-beating results. It must then decide how to use those results to attract new investors.

Weaknesses stop an organization from performing at its optimum level. They are areas where the business needs to improve to remain competitive: a weak brand, higher-than-average turnover, high levels of debt, an inadequate supply chain, or lack of capital.

Opportunities

Opportunities refer to favorable external factors that could give an organization a competitive advantage. For example, if a country cuts tariffs, a car manufacturer can export its cars into a new market, increasing sales and market share .

Threats refer to factors that have the potential to harm an organization. For example, a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop yield. Other common threats include things like rising costs for materials, increasing competition, tight labor supply. and so on.

Analysts present a SWOT analysis as a square segmented into four quadrants, each dedicated to an element of SWOT. This visual arrangement provides a quick overview of the company’s position. Although all the points under a particular heading may not be of equal importance, they all should represent key insights into the balance of opportunities and threats, advantages and disadvantages, and so forth.

The SWOT table is often laid out with the internal factors on the top row and the external factors on the bottom row. In addition, the items on the left side of the table are more positive/favorable aspects, while the items on the right are more concerning/negative elements.

A SWOT analysis can be broken into several steps with actionable items before and after analyzing the four components. In general, a SWOT analysis will involve the following steps.

Step 1: Determine Your Objective

A SWOT analysis can be broad, though more value will likely be generated if the analysis is pointed directly at an objective. For example, the objective of a SWOT analysis may focused only on whether or not to perform a new product rollout . With an objective in mind, a company will have guidance on what they hope to achieve at the end of the process. In this example, the SWOT analysis should help determine whether or not the product should be introduced.

Step 2: Gather Resources

Every SWOT analysis will vary, and a company may need different data sets to support pulling together different SWOT analysis tables. A company should begin by understanding what information it has access to, what data limitations it faces, and how reliable its external data sources are.

In addition to data, a company should understand the right combination of personnel to have involved in the analysis. Some staff may be more connected with external forces, while various staff within the manufacturing or sales departments may have a better grasp of what is going on internally. Having a broad set of perspectives is also more likely to yield diverse, value-adding contributions.

Step 3: Compile Ideas

For each of the four components of the SWOT analysis, the group of people assigned to performing the analysis should begin listing ideas within each category. Examples of questions to ask or consider for each group are in the table below.

Internal Factors

What occurs within the company serves as a great source of information for the strengths and weaknesses categories of the SWOT analysis. Examples of internal factors include financial and human resources , tangible and intangible (brand name) assets, and operational efficiencies.

Potential questions to list internal factors are:

• (Strength) What are we doing well?
• (Strength) What is our strongest asset?
• (Weakness) What are our detractors?
• (Weakness) What are our lowest-performing product lines?

External Factors

What happens outside of the company is equally as important to the success of a company as internal factors. External influences, such as monetary policies , market changes, and access to suppliers, are categories to pull from to create a list of opportunities and weaknesses.

Potential questions to list external factors are:

• (Opportunity) What trends are evident in the marketplace?
• (Opportunity) What demographics are we not targeting?
• (Threat) How many competitors exist, and what is their market share?
• (Threat) Are there new regulations that potentially could harm our operations or products?

Companies may consider performing this step as a "white-boarding" or "sticky note" session. The idea is there is no right or wrong answer; all participants should be encouraged to share whatever thoughts they have. These ideas can later be discarded; in the meantime, the goal should be to come up with as many items as possible to invoke creativity and inspiration in others.

Step 4: Refine Findings

With the list of ideas within each category, it is now time to clean-up the ideas. By refining the thoughts that everyone had, a company can focus on only the best ideas or largest risks to the company. This stage may require substantial debate among analysis participants, including bringing in upper management to help rank priorities.

Step 5: Develop the Strategy

Armed with the ranked list of strengths, weaknesses, opportunities, and threats, it is time to convert the SWOT analysis into a strategic plan. Members of the analysis team take the bulleted list of items within each category and create a synthesized plan that provides guidance on the original objective.

For example, the company debating whether to release a new product may have identified that it is the market leader for its existing product and there is the opportunity to expand to new markets. However, increased material costs, strained distribution lines, the need for additional staff, and unpredictable product demand may outweigh the strengths and opportunities. The analysis team develops the strategy to revisit the decision in six months in hopes of costs declining and market demand becoming more transparent.

Use a SWOT analysis to identify challenges affecting your business and opportunities that can enhance it. However, note that it is one of many techniques, not a prescription.

Benefits of SWOT Analysis

A SWOT analysis won't solve every major question a company has. However, there's a number of benefits to a SWOT analysis that make strategic decision-making easier.

• A SWOT analysis makes complex problems more manageable. There may be an overwhelming amount of data to analyze and relevant points to consider when making a complex decision. In general, a SWOT analysis that has been prepared by paring down all ideas and ranking bullets by importance will aggregate a large, potentially overwhelming problem into a more digestible report.
• A SWOT analysis requires external consider. Too often, a company may be tempted to only consider internal factors when making decisions. However, there are often items out of the company's control that may influence the outcome of a business decision. A SWOT analysis covers both the internal factors a company can manage and the external factors that may be more difficult to control.
• A SWOT analysis can be applied to almost every business question. The analysis can relate to an organization, team, or individual. It can also analyze a full product line , changes to brand, geographical expansion, or an acquisition. The SWOT analysis is a versatile tool that has many applications.
• A SWOT analysis leverages different data sources. A company will likely use internal information for strengths and weaknesses. The company will also need to gather external information relating to broad markets, competitors, or macroeconomic forces for opportunities and threats. Instead of relying on a single, potentially biased source, a good SWOT analysis compiles various angles.
• A SWOT analysis may not be overly costly to prepare. Some SWOT reports do not need to be overly technical; therefore, many different staff members can contribute to its preparation without training or external consulting.

SWOT Analysis Example

In 2015, a Value Line SWOT analysis of The Coca-Cola Company noted strengths such as its globally famous brand name, vast distribution network, and opportunities in emerging markets. However, it also noted weaknesses and threats such as foreign currency fluctuations, growing public interest in "healthy" beverages, and competition from healthy beverage providers.

Its SWOT analysis prompted Value Line to pose some tough questions about Coca-Cola's strategy, but also to note that the company "will probably remain a top-tier beverage provider" that offered conservative investors "a reliable source of income and a bit of capital gains exposure."

Five years later, the Value Line SWOT analysis proved effective as Coca-Cola remains the 6th strongest brand in the world (as it was then). Coca-Cola's shares (traded under ticker symbol KO) have increased in value by over 60% during the five years after the analysis was completed.

To get a better picture of a SWOT analysis, consider the example of a fictitious organic smoothie company. To better understand how it competes within the smoothie market and what it can do better, it conducted a SWOT analysis. Through this analysis, it identified that its strengths were good sourcing of ingredients, personalized customer service, and a strong relationship with suppliers. Peering within its operations, it identified a few areas of weakness: little product diversification, high turnover rates, and outdated equipment.

Examining how the external environment affects its business, it identified opportunities in emerging technology, untapped demographics, and a culture shift towards healthy living. It also found threats, such as a winter freeze damaging crops, a global pandemic, and kinks in the supply chain. In conjunction with other planning techniques, the company used the SWOT analysis to leverage its strengths and external opportunities to eliminate threats and strengthen areas where it is weak.

What Is an Example of SWOT Analysis?

Home Depot conducted a SWOT analysis, creating a balanced list of its internal advantages and disadvantages and external factors threatening its market position and growth strategy. High-quality customer service, strong brand recognition, and positive relationships with suppliers were some of its notable strengths; whereas, a constricted supply chain, interdependence on the U.S. market, and a replicable business model were listed as its weaknesses.

Closely related to its weaknesses, Home Depot's threats were the presence of close rivals, available substitutes, and the condition of the U.S. market. It found from this study and other analysis that expanding its supply chain and global footprint would be key to its growth.

What Are the 4 Steps of SWOT Analysis?

The four steps of SWOT analysis comprise the acronym SWOT: strengths, weaknesses, opportunities, and threats. These four aspects can be broken into two analytical steps. First, a company assesses its internal capabilities and determines its strengths and weaknesses. Then, a company looks outward and evaluates external factors that impact its business. These external factors may create opportunities or threaten existing operations.

How Do You Write a Good SWOT Analysis?

Creating a SWOT analysis involves identifying and analyzing the strengths, weaknesses, opportunities, and threats of a company. It is recommended to first create a list of questions to answer for each element. The questions serve as a guide for completing the SWOT analysis and creating a balanced list. The SWOT framework can be constructed in list format, as free text, or, most commonly, as a 4-cell table, with quadrants dedicated to each element. Strengths and weaknesses are listed first, followed by opportunities and threats.

Why Is SWOT Analysis Used?

A SWOT analysis is used to strategically identify areas of improvement or competitive advantages for a company. In addition to analyzing thing that a company does well, SWOT analysis takes a look at more detrimental, negative elements of a business. Using this information, a company can make smarter decisions to preserve what it does well, capitalize on its strengths, mitigate risk regarding weaknesses, and plan for events that may adversely affect the company in the future.

A SWOT analysis is a great way to guide business-strategy meetings. It's powerful to have everyone in the room discuss the company's core strengths and weaknesses, define the opportunities and threats, and brainstorm ideas. Oftentimes, the SWOT analysis you envision before the session changes throughout to reflect factors you were unaware of and would never have captured if not for the group’s input.

A company can use a SWOT for overall business strategy sessions or for a specific segment such as marketing, production, or sales. This way, you can see how the overall strategy developed from the SWOT analysis will filter down to the segments below before committing to it. You can also work in reverse with a segment-specific SWOT analysis that feeds into an overall SWOT analysis.

Although a useful planning tool, SWOT has limitations. It is one of several business planning techniques to consider and should not be used alone. Also, each point listed within the categories is not prioritized the same. SWOT does not account for the differences in weight. Therefore, a deeper analysis is needed, using another planning technique.

Business News Daily. " SWOT Analysis: What It Is and When to Use It ."

Seeking Alpha. " The Coca-Cola Company: A Short SWOT Analysis ."

Panmore. " Home Depot SWOT Analysis & Recommendations ."

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Walmart Company's SWOT Analysis Case Study

1. introduction.

The report will provide a brief background of the company, as well as its detailed SWOT analysis. Then, based on the basic understanding of SWOT analysis, the purposes of the study will be explained. The output of the SWOT analysis can provide the company with crucial information necessary in the strategic planning process (Fine, 2009), making the analysis important as it aims to enhance the company's strengths, minimizing and overcoming its weaknesses, taking advantage of existing opportunities and reducing the impact of foreseen threats. It has been proven that many smaller companies, including those in emerging industries, view the lack of competitive analysis as the major obstacle in the strategic planning process, often due to the cost and time constraints (Kocak, 2015). It is expected that the success of the planning to a large extent depends on the effective use of SWOT in informing the subsequent strategies (Jurevicius, 2013). This image has been removed because it was too large.

1.1. Background

Walmart, with its thousands of stores and presence in over 27 countries, is one of the biggest retailers in the world. It was founded in 1962 by Sam Walton and since then has expanded into various formats across the globe. With over 2.2 million employees worldwide, the company has built a leadership team in both its home country and abroad. Walmart's leadership team is led by President and Chief Executive Officer Doug McMillon, who has been employed by the company since 1990. As for the international segment, the leadership team is based in the international headquarters and is led by President and Chief Executive Officer Judith McKenna. In order to come up with a market entry strategy and an effective business plan, the company has to undertake a thorough analysis of the environment in which it is operating. The PESTEL analysis, Porter's 5 forces and SWOT analysis have been considered for this study. In order to gain a better understanding of Walmart in the UK and Ireland, it is also essential to conduct a competitive analysis in order to identify the company's social media competitors and carry out benchmarks. By analyzing the threats from political factors, economic factors, sociocultural factors, technological factors, environmental factors and legal factors, it will provide a better understanding of the market entry strategy deployed by the company in order to formulate its business plan. The Porter's 5 forces analysis have also been taken into account to assess the business strategy of Walmart and provide an understanding on how the company is able to tap potential opportunities in the market whilst also being aware of the various competition in the retail sector.

1.2. Purpose of the Study

To assess the future potential for Walmart, the opportunities open to the company, and the threats, the business has to be analyzed, studying one of the many models for analysis. Walmart is also a successful company and offers the world comprehensive product ranges such as clothing and accessories, toys, electronics, food, and so on. It is strongly famed for its very well-performing supply chain. However, no matter how strong a company's present is, virtually everybody should take notice of weaknesses in the market and outward as well, in order to improve it and make it more profitable and solid. So, the large business which is analyzed in this study is Walmart. By doing the SWOT analysis, this is also a useful and very important step in assisting any company and that also requires identifying its strengths, weaknesses, opportunities, and threats. When it comes to the purpose of the study, the study also attempts to carry out the analysis beginning with the background of Walmart, why the study is also being performed, what the focus of the study is, and also reveal the parties that are incredibly interested in the study. The main purposes of the whole assessment can be summarized as identifying key performance areas of the business in the United States, showing the information technology and the business process and performance, assessing different types of risks associated with supply chain management, and providing some lessons on the benefits and use of information technology in supply chain management.

2. Strengths

First and foremost, one of the main strengths of Walmart is its status as an established brand. Studies have shown that the Walmart brand is one of the most recognized in the world. It is important to recognize that brand recognition is not just powerful, it is also long lasting. In strong economies or weak, Walmart's standing as a cheap and convenient shopping destination means that it will continue to see consumer traffic. The availability of a wide range of products in one place also serves to give Walmart's customers the choice that they would expect from a large retailer. Some stores and small businesses can only provide a very narrow range of goods. However, in Walmart, the huge product range, the choice between different types of product and the diversity of manufacturers supplying the goods all help to give customers the freedom to make their shopping experience as convenient or as varied as they wish. Additionally, Walmart's supply chain is highly advanced. The company has invested heavily in technology and its servers to make its supply chain as strong and responsive as possible. Walmart's technological and logistical innovation ensures that it is able to manage and maintain an enormous and constantly changing amount of stock in its supply chain which, in turn, means that products are replenished on the shelves in the most efficient way possible. Therefore, Walmart has a reputation as a good and reliable supplier and this is facilitated by its supply chain which is recognized as one of the quickest and most efficient in the world in the retail industry.

2.1. Established Brand

Another strength of Walmart is the fact that the company has a well-established brand. According to the annual ranking of U.S. based companies by Brand Finance, a brand consultancy firm, Walmart was the most valuable brand in the retail sector in both 2018 and 2019. The brand was valued at $45 billion in 2018 and close to $47.5 billion in 2019. A strong and well-established brand is valuable because it is instantly recognizable and is generally more trusted by customers compared to a newer or unknown brand. Also, a recognized brand can attract more customers and this can lead to higher sales and revenue. This is reflected in the financial records of Walmart. The company has seen an increase in its annual revenue from $485.9 billion in 2016 to $514.4 billion in 2019. It is important to mention this point in the "strengths" section of the SWOT analysis because a well-established brand is one of the key advantages that a business has over its competitors. It can play a crucial role in the success of a company. For instance, a business with a strong brand can more easily launch new products and customers are more likely to make recurring purchases and remain loyal if they trust the brand. Therefore, this is something that Walmart is doing well that it should be proud of and something that sets itself apart from other competitors. Last but not least, a company with a well-established brand will get better offers for partnerships and mergers. Adweek has shown that 131 mergers and acquisitions have taken place in the brand activation marketing sector from 2017 to 2018. If a company has a strong brand, it is easier for the company to get partnerships or it can take over a smaller business. These partnerships could lead to reductions in costs and access to new resources which in turn could help the business increase its competitive advantage even further. So ultimately, a strong brand is very valuable. This means that any marketing activities that build the brand's reputation and improve its visibility in the marketplace are valuable and therefore, in the "strategies" section of the marketing plan, you should consider recommendations such as investing in promotional campaigns across all touchpoints or evaluating new product possibilities. All of which would ultimately make the company even stronger.

2.2. Wide Product Range

First and foremost, it's a main priority that the company offers a wide range of products to its customers in its physical and online stores. This is a significant strength of Walmart compared to its main competitors and it is a reason why the company has a competitive advantage in retail. A wide range of products implies that the company can serve a wide range of customers. It also implies that customers can get all they need under one roof. This is particularly important to customers who lead busy lives and don't have time to travel between a number of stores to get everything they need. Furthermore, Walmart also offers pharmacies, garden centers, photo centers, opticians and Subway in some of its stores. This additional range of complementary services and products also creates more attraction for customers to visit Walmart and spend money. The company is also making successful progress in developing online stores through a wide range of products available online. Such development of wide product range in online operations has been also identified as a significant achievement and strength of Walmart's e-commerce. Wide product range and more customer footfall in online store can be the key factors to drive future online sales growth. Walmart has a range of items, more than 120,000 stock keeping units and all of them are visible through enterprise-wide system. It enables the stock to be easily tracked, helps in determining fast and slow-moving goods, and also helps reordering. "Flexible process and high service program" further explains that sales associates get the facility to open any register to check out the customers. Customer can place the order in the store but detail including tracking numbers, home page and product description and picture can be viewed at home. This also another case study where the company uses customer satisfaction as a marketing tool. Such a high level of trading that the company performs on an everyday basis gives Walmart enough bargaining power against suppliers which makes it a possibility for Walmart to choose what goods it wants to stock. The main distribution strategy of Walmart is based on vendors' collaboration by adopting an efficient consumer response approach keeping inventory levels low and thereby reducing warehousing costs and increasing return on equity. This can be done by sharing information about sales and inventory levels whereby the products can be managed more effectively. Such distribution strategy not only increased the delivery frequency but also lowered inventory.

2.3. Strong Supply Chain

They do not only employ many innovative techniques, such as "cross-docking" which is explained in the 2013 Walmart case study and in the summary. In addition, the company has invested a huge amount of money in a large and modern global transportation fleet. This guarantees that they have complete control over their distribution network. This is absolutely a critical capability considering the global scope of the company with nearly 260 million customers being served per week. In the US, there are a total of 147 distribution centers, and this requires a most sophisticated logistics operation to maximize the number of products moving through the supply chain, and to combat the national supply chain distribution challenges and constraints. Post the distribution center's operation, the products are through the transportation network, directly to the cross-dock, and then to the store floor. No matter where the suppliers are, and where the customers are, the key is to move products as quickly and as cost-effectively as possible into the customers' hands. The money saved here can then be reinvested into further improving the point-of-sale systems, store information infrastructure, or staff training. Such an efficient supply chain, exhibitions of the magnitude of success in the implementation of the unique and highly efficient supply chain management in Walmart. It also shows how the flow and the management of the activities in the process of the products being transferred from the suppliers to the customers. For example, customers really do not need to do anything but a few easy and simple mouse clicks on the Internet, then the products they like will arrive at their front door soon. On the contrary, the shopkeepers can sit in their shops reading books, and the rest will be smoothly undertaken by the employees there. All these are thanks to the creation of the most suited supply chains, that is, the agile supply chains that help respond to the ever-changing market needs and the demand.

3. Weaknesses

The first significant weakness highlighted in the "Walmart Company's SWOT Analysis Case Study" is high employee turnover. According to the case study, the company lost around 500 of its 1.4 million U.S. employees every day. This is a huge weakness for the company because high turnover rates can lead to a decrease in product sales, as new employees often need a lot of training and time to adapt to the new working environment. The case study suggests that Walmart needs to address the reasons why its employees leave the company, as high employee turnover can cost the company both financially and in terms of the knowledge base that valuable employees provide. Another weakness identified in the case study relates to a limited online presence. Walmart has been focusing on opening new stores and establishing its presence in other countries, such as China, in order to drive its sales. Consequently, the company has been slow to develop its online presence in comparison to its competitors, such as Amazon. This is a significant weakness because, as identified by the case study, online sales are more profitable than in-store sales because the cost of fulfilling online orders is lower and profit margins are higher. Therefore, as the case study suggests, it is essential that Walmart invests more in e-commerce in order to take full advantage of the growing popularity of online shopping.

3.1. Employee Turnover

On the other hand, Walmart needs to address high employee turnover. For several years, Walmart has suffered from a high employee turnover rate. As of financial year 2019, the employee turnover rate stood at 34% compared to the US retail industry average of 13%. The company's high turnover rate can be attributed to various factors. First, Walmart is known for its stressful work environment. According to the employees, the company's high paced work and frequent stocking quotas contribute to the stressful work environment. In addition, employees chronically complain of low pay, inadequate hours of work and uncertain work schedules. Walmart allocates very little to personnel costs. The reason the company pays a minimum wage which is below medical and cost of living needs. The company produced a turnaround strategy led by the human resource manager in 2018. The plan is to reduce employee turnover and improve the human resource by investing more into human capital. First, the company has initiated a better than minimum compensation package to attract and retain employees. The hourly wage for store associates is set to be increased from $11 to $13 and associates need to have a certain paid time off when they achieve service hour tiers. The second strategy is to implement more effective training schemes for staff. The plan is to maximize workers' engagement and development so as to keep them longer in the company. New academy stores are built around the country to provide a workplace for continuous education and training. Through implementing the strategies, the management hopes the employee turnover can be reduced and the work efficiency can be improved. These efforts are getting successful. As understood by the company report, the total count of workforce in July 2018 was 1.5 million but the number in 2019 is 1.4 million. The voluntary employee turnover rate was reduced by 110 basis points corresponding to 3% reduction. It signifies Walmart is on the way to a more stable and quality delivery service to the customers. Also, Walmart's development strategy in global markets involves the optimization and globalization of business practices. This company activity is planned to leverage the company's international scope. By continuously investing in and optimizing the global supply chain, Walmart is expected to lead the industry in terms of the efficiency and sustainability aspects. Customer value is maximized through the use of resources. Providing the low prices and better product mix, the company is aiming to improve customer satisfaction and the entire customer experience globally. There will be better sales generation in the future and high market share. By connecting local and global investments, Walmart is devoted to continue to deliver the everyday low prices. Well, the company's effort is expected to be in line with the human rights and workplace peoples, such as the labor laws on minimum wage and working hours. Also, the company enjoys a good relationship with the government and this cooperation is beneficial to the business expansion in Brazil.

3.2. Limited Online Presence

The low speed of the internet and the lack of technological development in the majority of the emerging markets act as significant challenges for the company. Walmart has a limited online presence, yet it is a known fact that the future of marketing is in the internet and social media. People are increasingly spending more time on the internet and it's predicted that by 2021, global digital ad spend will have grown by 78% since 2016. Walmart needs to place more focus on online marketing and being able to target certain audiences using data analysis and programs such as Google Ads and Facebook Ads. The company needs to expand its presence online in order to increase market share, raise brand awareness, and accelerate the growth of e-commerce which is the next point of the analysis. With the use of big data, marketers are able to create personalized online experiences and use accurate customer segmentation to build brand loyalty and improve customer satisfaction! This also means that the return on investment made in marketing is more tangible as the data analysis shows an insight into the level of consumer engagement with the company's website and social media pages. There are lots of opportunities with social media parallels being created in the virtual space where consumers can interact with each other's experiences and even offer suggestions on products and services. Also, with the improvements in mobile technology, this means that marketing strategies can be tailored to specifically user's location by introducing GPS technology to smartphones and tablets. With the introduction of Walmart Pay in 2015, a mobile payment and digital wallet service for its customers, I believe that Walmart can link this service with the formation of a mobile application for its customers. In that way, Walmart can use the position and location of its customers to push promotions and offers that are available to them in the respective stores and potentially influence buying habits. By awarding customer loyalty points and tailoring special offers to customer segments, a closer relationship can be built between the customer and the business leading to transactional success. The introduction of digital wallets and mobile applications are also seen as methods of improving service efficiency and shopping accessibility to the everyday consumer. The effect of the digital age on how companies market their products and services is ever growing and it's a key weakness for a company to have limited outreach on the internet and through social media.

4. Opportunities

Expansion opportunities, including overseas or new concept expansion, offer diverse companies a wide range of options to pursue this strategy. There are many specific opportunities which companies can benefit from and that will be detailed in Walmart. First of all, by pursuing an expansion strategy, the company will enter new markets. As one of the largest retailers, people might think that Walmart has captured most of the market shares in the US. However, the industry is still growing, and the competition is still not as intense as in some other industries. By entering new markets, there is no need to fight against the current competitors and existing companies. Also, the strong competitive pressure for Walmart international expansion is relatively small, comparing to that in the US. In the US, the threat of substitutes and the threats of the bargaining power of buyers are both strong, according to Porter's Five Forces, the framework which helps to analyze the level of competition in the industry and it will be discussed further in our report. However, once Walmart has large economies of scale and brand advantages, the threat of substitutes, the threats of the bargaining power of buyers of Walmart will be much reduced. This is because Walmart will be in a position to lower the prices. Lower prices will deter buyers from switching to competitors' products and the brand power of Walmart will also attract potential buyers. Evidently, Walmart is practicing this strategy already. The company is putting efforts into the development of e-commerce to attract more purchasers and to build brand awareness worldwide. Also, Walmart used an acquisition strategy to further smooth the quick entrance into new markets. As we all know, acquiring a company is much quicker than developing similar business processes. For example, Walmart China has announced that it is acquiring a minority stake in the largest China's e-commerce business, which is also known as in was open. This will provide Walmart new growth and profit opportunities in the digitized Chinese market. On the other hand, Walmart may think about developing new business models. For example, Walmart was successful in Chicago through the development of Walmart Express, the first Metro format stores in the US. It is because shoppers enjoy access to fresh, healthy products, and access to on-site pharmacies, financial services, fuel stations, and free carbon offset. However, those stores were closed in 2016. Yet the concept of one-stop shopping experience for consumers of all the needs life still makes sense. If Walmart can provide this kind of shopping experience with less operation cost such as rents and wages, this will be a good point to consider in the future. By achieving a successful unique business model, Walmart can generate competitive advantages and further expansion plans will be easier.

4.1. Expansion into Emerging Markets

Walmart's current business strategies have proven to be effective, as its international operations have emerged as successful. All of the international operations have strong growth records. Around 273 of Walmart's stores are located in Brazil, and the continuation of a worldwide financial slump might affect the firm. But by utilizing its resources and capability in opening up new markets, Walmart can lower this threat of such downturns. There is also a present opportunity as Asia is concerned, in agreement with some work that has just been done by the China Chain Store and Franchise Association (CCFA). The CCFA has discovered that retail sales in China have increased by 12.9% over the last 10 years and it also anticipated a rise of 15% by the end of this year. And the Walmart store chain has taken benefit of the expanding market in China. First Walmart store in China was launched in Shenzhen in 1996, offering 6,700 square meters of retail room, in agreement with Research. In the recent years, Walmart is proud to express it has opened up to 106 outlets around China, covering 43 main cities. There are 88 supercenters, 8 SAM'S Clubs and 10 easy to shop mini outlets, offering around 56,500 jobs in China. By September, Walmart outlets have embraced more than 11 million customers on a daily basis, with sales numbers breaching $7 billion last year. Adding the economic statistics from 2010 to 2013, it shows that China has got a high proportion in terms of profit in international market share. Also according to the 2013 annual report, Walmart has made positive strides in the Chinese market by implementing an initiative in terms of environmental sustainability policy, that is to provide more products with better price and quality, and at the same time enhancing its social responsibility in China. Such well developed international policies and practices might get Walmart through a huge development in Asian market such as in China. From the strategies point of view, as to minimize the seriousness of weaknesses, exploiting the opportunities which Walmart has got would be the best effort and chance to fight against the economic downturn. However, any adjustments or amendments, for instance, new strategies, should be informed by a full understanding of the external environment.

4.2. E-commerce Growth

Walmart's e-commerce business has a lot of potential. According to the case study, the company's e-commerce sales growth rate is 20-30% each quarter. Walmart has been adapting its online experience to its customers' trends, which have led to a rise in the demand for online grocery shopping. Walmart is currently ranked number four in e-commerce sales, trailing behind Amazon, Apple, and JD.com. By implementing and investing further in technological innovations, such as using big data to efficiently meet customers' needs, Walmart is in a good position to expand its online presence and outpace its e-commerce competitors. Another e-commerce growth plan includes expanding the assortment online to 75 million by 2020 from the current 35 million and leveraging its 4,700 stores in built-up urban areas, acting as potential distribution centers for online sales. This is an opportunity for Walmart to capitalize on its large network of stores and boost online sales. The case study also mentions that Walmart opened 'Store Number 8', which is an incubator for new technology ideas. This could help Walmart in tapping into new markets and attract new customer segments. Overall, Walmart's e-commerce growth plans appear to align with current market trends and take advantage further in the continuous digital sales revenue growth. The case study also states that Walmart plans to invest and integrate digitized methods and research to create more engaging digital experiences to provide customers with unique services. Walmart's e-commerce strengths, opportunities, and optimistic future advertising plans are reflected in the case study. With continuous strategic planning and further resources allocation to e-commerce growth, Walmart could potentially attract more customers and expand its market share in online retailing.

4.3. Diversification of Product Offerings

Walmart's current product offerings span across various product categories such as clothing, food, seasonal items, and the like. Offering even more variety of products, particularly in the specialty grocery section, can draw in new customers and satisfy the needs of the existing customer base. Dr. Charles Stack, a business development expert, has the view that diversifying product offerings can lead to greater market penetration and has the potential to increase store visits by customers who are focused on a particular product category. For instance, "when a retailer can get it right in terms of variety and do it well, it's going to drive a whole lot of traffic," he said. More than just capturing larger market share through diversity of products, a diversified product line provides stability in sales to the company over the years. Walmart will not be overly dependent on seasonal or cyclical sales and new products could overshadow the reduction of other slowing selling products. In the annual report of Walmart year 2017, it has been reported that the management is looking into improving the store and renovating many of the stores across the nation as part of the midterm growth strategy to improve customer experience. There seems to be ample space to introduce new types of products in existing Walmart stores, be it increasing more organic foods, international food selection or special diet food such as vegetarian or gluten free. International food sections, in the all-inclusive of international relief and expats, should be established in Walmart across the nation. As Walmart already offers a variety of products of this kind, any expansions on such products could hardly damage the existing product line. With a product line consisting of high market growth products and steady mature products, Walmart can just ensure success in the future. Dr. Steven Hoberman, a lecturer with a PhD in Political Science in the USA, has the view that diversifying products will not only benefit Walmart itself but also the consumers. The implementation of this strategy will likely achieve brand loyalty with the customers. As "offering customers multiple choices and providing new products on a daily basis is a successful knack in preserving customer loyalty," he said. It is because the availability of a wide range of choices will increase the chance for a customer to find a type of product that he or she truly enjoys and lead to multiple purchases and many repeated customers. If new products are being added frequently, customers may be stimulated to visit the store or make a purchase even if they have just made a purchase not long ago because the customer feels positive that there may be new products from time to time and they could find something they truly like. This is going to drive customer satisfaction and hopefully, brand loyalists will be developed. Also, customers will feel more secure and comfortable with the presence of numerous choices and they believe in the notion that the products Walmart offers will make their life better in different means, be it economic scale or increase better living standards.

4.4. Sustainability Initiatives

Since the 2000s, Walmart started to focus more on the concept of sustainability. The company has made great strides in this area by implementing various initiatives. Walmart aims for a sustainable supply chain that is beneficial to the environment and the society as a whole. For example, in 2010, Walmart began to work with the Sustainability Consortium to create a sustainability index that measures the sustainability of every product. This will provide transparency to the consumers by educating them about the supply chain and its impact. Also, this will create continuous improvement in the manufacturing of products. Walmart has set a goal to run the company with 100% renewable energy. In last year, the company began to buy the green energy from the suppliers in the US and also installed large solar panel arrays on the distribution centers and the stores. In addition, 80% of the waste from the Walmart stores and distribution centers is being diverted from landfills. The waste is either being recycled or is turned into other products that are used in daily life, such as compost blocks, which are being used in the gardens. Also, as part of Walmart's sustainable agriculture strategy, the company has developed a number of global responsibility programs in the regenerative farming, farmer training and sustainable agriculture ingredients. One of the programs is called Farmer Training Program and it is specifically designed to train the farmers in the developing countries about the sustainable agriculture, which is eventually being tied to the direct supply chains of the Walmart. Through this program, farmers are being taught about how to enhance the environmental quality, the natural resources as well as the economic profitability. And in return, the suppliers will have a well-maintained and well-managed raw material that will be able to fulfill the supply standards. This can be beneficial for everyone, including the suppliers, the farmers, the customers and Walmart itself as it guarantees the reliability and the quality of the products. The sustainable agriculture ingredients program will ensure that these ingredients are being produced in a way that is socially responsible and good for the environment. These programs have allowed the suppliers to take advantage of economies of scale as the demand for these ingredients is being increased over time. Through advocating estimation and advance innovation, Walmart shows the commitment in helping to solve the social issues and public need.

The intense level of competition within the industry is a considerable threat that Walmart must address. As the largest player in the industry, Walmart is a target for competition from regional and global retailers that seek to expand their market share. Companies like Amazon, Kroger, and Costco pose substantial competition in the food and grocery retail sector, and retailers like Target and Dollar General are also increasing their efforts to capture a larger share of the market. As these companies continue to expand and develop their strategies, Walmart must continue to analyze and differentiate its business model and market strategies in response to the strategies and competitive advantages of these and other new market entrants. Economic fluctuations pose significant threats to Walmart's business as well as its comprehensive financial performance. Due to the size and sales growth of Walmart, the business is frequently the subject of academic research that focuses on analyzing consumer preferences and how consumers respond to the general economy based on resources and finances. This is well illustrated by the impact of the 2008 financial crisis, which caused many companies, including Walmart, to suffer a significant decrease, followed by a long period of slow recovery. Such economic downturns are likely to result in decreased disposable incomes, reduced or stagnant consumer demand, and disrupted consumer confidence in the market. Changing consumer preferences and shopping behaviors are proving to be substantial challenges for Walmart. With the rise of the "omni-channel" shopping model, which involves the seamless integration of in-store and online shopping experiences, Walmart and other traditional retailers face the challenge of competing with companies that have made significant progress in developing technological platforms and electronic interfaces that cater to such consumer trends. For example, Amazon has launched "Amazon Go," a new shopping model that utilizes mobile technology so that consumers can bypass checkouts, and it continues to expand drive-up grocery locations which cut delivery times and eliminate the need for consumers to enter the store entirely. Such advances in technology and the widespread acceptance of online shopping as a new and convenient shopping model within the daily lives of American and global consumers mean that companies like Walmart that still rely heavily on the brick-and-mortar strategy must adapt their practices and make further investments in online shopping infrastructure in order to keep capturing the attention and consumer spending.

5.1. Intense Competition

One of the major threats that Walmart faces is from intense competition. There are several retail companies in every market which are competing with Walmart for the same set of customers. Some of the main competitors are Amazon, eBay, and other supermarket chains such as Tesco and Carrefour. These companies are constantly trying to come up with innovative ideas to beat Walmart and attract more customers. For example, Amazon has launched a new service called Amazon Fresh through which customers can order fresh produce online. This has increased the competition for Walmart. Also, major supermarket chains are opening smaller stores across the United States which could challenge Walmart's dominance in the market. Walmart has also seen considerable competition in countries such as the United Kingdom and Canada, where discount supermarkets have made large market share gains. For example, the discount supermarket Aldi from Germany is rapidly expanding its business especially in the UK and increased the competition for Walmart owned ASDA supermarkets. This not only means that Walmart has to continually assess whether its product offerings and prices are competitive, but also it may have to consider investing more in its existing locations to retain its market share in the face of increased competition. If the company is not able to meet the ever changing and fierce competition, it may lose its market share and customers to the competitors and therefore the profitability of the company may decline over time. This puts pressure on the company to not only receive and integrate feedback to improve and grow the already existing business, but also to innovate and develop new strategies on an ongoing basis to keep the competitive edge over the rivals. Also, the company may have to consider assessing opportunities in other markets, diversifying its product offerings and possibly growing its e-commerce sector to ensure sustainable growth for the future. This demonstrates that the intense competition in the current retail industry could potentially create opportunities for the company. However, it is important to note that the company must adapt to the ever changing market and retail landscape by developing and implementing strategies to maintain market share and to ensure sustainable growth for the future.

5.2. Economic Fluctuations

Furthermore, economic fluctuations can be worrying to Walmart. During challenging economic times, where consumers are faced with high unemployment and uncertainty about jobs, they make their purchases in a very careful manner. In addition, while Walmart's low price strategy could be beneficial to them during tough economic times, there is evidence that increasingly affluent and higher income consumers might be turning away from Walmart to do their purchases elsewhere, harming Walmart's revenue stream. On the other hand, during good economic times, the opposite could be happening, as consumers' purchasing power increases and the demand for more expensive and diverse goods also rises. In addition, consumers' price sensitivity is likely to become less of a factor as the economy continues to do well. However, Walmart also faces tight competition during good economic times from other high-end retailers in the industry. For example, Target has been capitalizing on offering an upscale shopping experience, and more and more consumers are choosing to shop at Target instead of Walmart. Therefore, from a strategic point of view, Walmart has to be able to adjust and tailor their strategy in accordance with the changes in the economy in order to remain successful in the long term.

5.3. Changing Consumer Preferences

As consumer preferences change, so too must companies change to take advantage of the desires of consumers. For example, consumers today have a preference for healthier and more sustainable food products, shifting away from the processed and packaged food items that were popular in the past. Furthermore, consumers' increasing comfort with and reliance on technology has opened the door to online grocery shopping, but only in recent years have companies started to capitalize on the potential for this market. Walmart has already begun to invest in appeals to the environmentally conscious consumer, promising to reduce plastic waste following a brief spat with Greenpeace in February of 2019. More than that, Walmart also has a number of private products which compete in the organic sector. The strengths and weaknesses identified in this SWOT analysis align with these opportunities and challenges related to changing consumer preferences. For example, the trend towards more eco-friendly and all-natural food products in North America means a big opportunity for both local and global farmers who can grow these foodstuffs. And yet, the threat remains from Amazon and its ability to capitalize on the increasingly popular online market, despite Walmart recently announcing a new strategy back in January of 2019. In short, Walmart's recent advancements towards aligning itself with the green sector and technological advances hold great promise not only in preserving its own success but also in taking advantage of new emerging markets. The information in this case study is accurate as of June 2019. The Walmart Company's SWOT analysis is indicative of the company's overall strategic management and its system of strategic decision-making. These details are by no means perfect and it's likely that the information can be used to make a number of different arguments. But the case study is not focused on precision; the purpose is to provide you with ample material combined with thought-provoking refutation.

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Did You Know? 

ITC is the only company in the world of comparable dimensions to be carbon, water, and solid waste recycling positive.

Awards and Recognitions

1.      Pulp and Paper International Awards by Fastmarkets RISI.

2.     First Prize in “Best in Industry for CSR Activities” at the National Water Awards 2022. 

3.     The SABRE Award for achievement in Reputation Management in 2021.

4.     “Best Governed Company” at ISCI National Awards for Excellence in Corporate Governance 2020.

5.     “The Corporate Hotelier of the World Award 2019” from Hotels USA.

Did You Know?

Renewable energy makes up about 43% of the total energy used in ITC. 

Market Details

Business model.

The major pillars of ITC’s business model focus on multiple revenue streams, diversification, and customer satisfaction.

1.    Diversification – Their company operates in several industries, such as FMCG, packaging, lodging, etc. They provide affordable products to a diverse range of customers in each business. 

2.    Revenue Streams – Although the sale of cigarettes is their main source of income, they also make money from hotels, FMCG, and paperboard segments. 

3.    Presence – ITC is recognizable nationwide due to its vast corporate presence and reputation, which they have developed over time.

4.    Distribution Network –  Reaching every region of the nation is possible because of ITC’s extensive and dispersed distribution network. 

The operations of ITC can be classified into 4 major segments.

1.      FMCG – ITC has a strong representation in the sector of Fast Moving Consumer Goods (FMCG). They sell a wide range of goods, including branded packaged food products, cigarettes, stationery products, and personal care items.  

2.     Agri Business – The segment of the business sells a variety of goods like unmanufactured tobacco, wheat, rice, and spices. The segment provides brands like Kitchens of India, Aashirvaad, Sunfeast, and Bingo. sdaA

3.     Hotels – They own various hotels around the nation that provide first-rate hospitality services. 

4.    Paperboards, Paper and Packaging – ITC is one of the biggest paper manufacturers in India, and its eco-friendly product line is well-known.

Financial Highlights

Balance sheet.

The graph indicates a substantial increase in major line items. Thus, indicating a slow but consistent growth trajectory without raising non-current debt.

Income Statement

The graph shows a major jump in total income over the past 2 years. A significant jump in profit figures.

Cash Flow Statement

SWOT Analysis

1.      The company offers a wide variety of items , which lowers its business risk and offers it significant room for expansion.

2.     It is regarded as a well-established brand , which helps it win over consumers’ trust and take the lead in the industry. 

3.      Reaching both urban and rural customers nationwide is made possible by ITC’s remarkable nationwide distribution network . 

4.      The company’s finances have shown consistent growth ; they have experienced major improvements in all line items over the years. 

1.     A major source of revenue comes from the tobacco industry , which may be subject to regulatory changes in the future and ultimately result in a reduction in their profitability. 

2.      Despite being a leading player in the Indian market, ITC has not been able to control a significant portion of the global market .

3.      ITC operates in the highly competitive FMCG sector , where they face fierce competition from both local and foreign companies. 

Opportunities

1.     They have a fantastic chance to grow the company globally and make use of their experience and well-known brand to gain market share. 

2.      They could take up fresh ventures in a variety of industries, such as wellness, renewable energy, and healthcare. 

1.      Their income and profitability could be negatively impacted by any economic downturn .

2.      Since the tobacco industry is their main source of income and social activists are a danger to them, any regulation changes implemented by the government could hurt the operations . 

3.    Consumer preferences are subject to frequent changes throughout time. Businesses risk losing the market share if they are unable to adapt to changing customer tastes and preferences. 

ITC leads the FMCG market; over time, its product line has broadened, and in recent years, its revenue has increased significantly. We can conclude from a thorough analysis of all the variables, including risk and strength, that the company has positioned itself as a market leader across several categories and will persist in its dominance of the FMCG sector. If you are looking to invest in this company, then consider your risk profile before making any investment decision. 

Frequently Asked Questions (FAQs)

Q1. Is ITC a profitable company? Ans. Yes ITC is a profitable company as it has been making profits for a long time.

Q2. Who is the chairman of ITC? Ans. Mr. Sanjiv Puri is the chairman and managing director of the company.

Q3. Does ITC operate hotels? Ans. Yes, ITC operates a luxury chain of 115 hotels in 80+ destinations.

Q4.  What are the major popular cigarette brands of ITC? Ans. Insignia, India Kings, Gold Flake, Wills Navy Cut, Capstan, Classic, etc., are popular cigarettes sold by ITC.

Q5. What was ITC’s first product? Ans. ITC started its business in 1910 by manufacturing tobacco products and cigarettes.

Disclaimer: The securities, funds, and strategies mentioned in this blog are purely for informational purposes and are not recommendations.

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