SWOT analysis Full Form

The full form of SWOT is Strengths, Weaknesses, Opportunities, and Threats. It can also be written as TOWS – Threats, Opportunities, Weaknesses, Strengths. The SWOT analysis of a company is done for environmental scanning; in other words, to identify the risks, threats, and upcoming opportunities and compare the company’s strengths and weaknesses with other companies. SWOT analysis evaluates both external and internal factors.

How to do a SWOT analysis of a company?

To do a SWOT analysis of the company, keep the following things in mind:-

• Make a list of the strengths of the company – By doing this, the company would be able to know its strengths

• Work on the weaknesses – A company needs to work on its weak areas; in other words, the factors hindering its growth

• Foresee opportunities – Companies should be aware of the upcoming opportunities to benefit from those

• Identifying the threats- Evaluating threats is very important. Thoroughly research the competitors and market conditions, trends and influences

Also, various SWOT analysts guide the companies and build their strong product lines

SWOT

Strength

Strength depicts the qualities of the company in which it excels and also the company’s strong point. The company’s strengths distinguish it from its competitors.

Let’s talk about the company’s strengths. It could be customers’ loyalty toward the company, mighty brand name, good turnover, unique products, high service level, good advertisements skills, attractive product packaging, good public relation, healthy relationship between employers and employees, good investors, goodwill in the market, etc.

For instance, an organisation has recently made changes in its strategy. The results are quite good; in other words, the organisation’s turnover has increased, so now, it must determine what to do to attract new investors.

Weaknesses

Strengths and weaknesses are said to be two internal factors of the company. There are many weaknesses in the companies that need to be analysed.

Weaknesses like a weak brand, poor goodwill, limited market share, high liability, lack of capital, no investors, debts, inadequate public relations, weak brand equity, no customer loyalty towards the brand or company, unhealthy employer-employee relations, strong existing competitors, etc., are some signs of weakness of the company. If these continue to exist, then it won’t be able to survive in this industry for an extended period. The organisation/brand needs to identify its weaknesses and solve them for better business growth.

Opportunities

Opportunities are the external factors that could be favourable for the company’s growth if used properly. Some of the opportunities are improving the overall customer experience, building brand awareness, demand for home delivery services, customer retention, good investors to increase the brand’s goodwill, etc.

Threats

Threats refer to something that is not favourable for the growth and success of the company, business or brand. Opportunities and threats are considered to be two external factors. As seen above, strength is a favourable internal factor, and weakness is an unfavourable internal factor. Similarly, opportunities are favourable external factors, while threats are considered unfavourable.

Some threats for the companies are an instant increase in the cost of raw materials, an increase in rivals/competitors, rising fixed costs, poor rating on review websites, low availability of labour, a decrease in demand, a shift of consumers to its rivals, declining economic conditions, etc.

SWOT table

Conclusion

In this article, we have explained what SWOT analysis of a company is. Moreover, there is a brief discussion about the strengths, weaknesses, opportunities, and threats of a company, brand, organisation or enterprise.

SWOT analysis evaluates all these things to help the company grow and succeed. We have also discussed what factors the company or SWOT analysts should consider before identifying various internal and external aspects.