SWOT Analysis is useful technique for evaluation of Strengths, Weakness, Opportunities and Threats for your business. Strengths and weakness are the internal factors; opportunities and threats are the external factors which affect the business. So it is also known as Internal-External Analysis. By SWOT Analysis you can identified the favorable and unfavorable factors for your business. It can be done for a product, person, place or industry.
When you are involved in trading business you must be both clear and honest on all packaging and labeling. Avoidance in any way, you could find yourself committing a criminal offence under the Consumer Protection from Unfair Trading Regulations 2008.
How to do it?
This tool is originated by Albert S Humphrey in the 1960s. For the application of this tool, you have to find out the answers of the following questions:
Strengths are the internal factors of the business that give it an advantage over others. We should also consider these strengths from both the customers and competitor’s point of view.
Does our organization have any advantage?
Do we have low overhead, so we can give competitive price to our customers?
Do we have strong brand names?
Do we have good reputation in industry?
In which areas we are better than our competitors?
Do we have positive attributes of people, such as knowledge, background, education, credentials, network, or skills?
Do we have tangible assets in the company like capital, credit, existing customers or distribution channels, patents, or technology?
Weaknesses are also internal factors of the business that which are not good for the business. We should also consider these weaknesses from both internal and external basis.
Does our organization have any disadvantage?
Do we have high overhead, so we can’t give competitive price to our customers?
Do we have poor brand names?
Do we have poor reputation in industry?
In which areas we are weaker than our competitors?
Do we have negative attributes of people such as lack of knowledge, background, education, or skills?
Do we have lack of tangible assets of the company like capital, credit, existing customers or distribution channels, patents or technology?
Opportunities are the external factors which are favorable for the business and also help to eliminate the weaknesses.
Changes in government policies which are favorable to the business.
Arrivals of new technologies those are favorable to the business.
Group of unsatisfied customers those needs are fulfilled by your product.
Removal of international trade barriers which is good for the business.
Competitors are unable to adapt new technologies.
Change in market which creates opportunity for the business.
Threats are the external factors which are not favorable for the business.
Arrival of new technologies that makes product or equipment obsolete.
Changes in government policies
Changes in customers’ taste
Insertion of trade barriers.
Few rules for SWOT Analysis
SWOT Analysis should be short and simple.
It should be realistic and specific.
By the analysis you should be able to know where your organization will be stand in future.