Baofeng Modern Intl (1121) SWOT Analysis / TOWS Matrix / MBA Resources
Footwear
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Baofeng Modern Intl (Hong Kong)
Based on various researches at Oak Spring University , Baofeng Modern Intl is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, technology disruption, increasing household debt because of falling income levels, there is backlash against globalization, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google,
increasing commodity prices, geopolitical disruptions, etc
Introduction to SWOT Analysis of Baofeng Modern Intl
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Baofeng Modern Intl can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Baofeng Modern Intl, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Baofeng Modern Intl operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Baofeng Modern Intl can be done for the following purposes –
1. Strategic planning of Baofeng Modern Intl
2. Improving business portfolio management of Baofeng Modern Intl
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Footwear sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Baofeng Modern Intl
Strengths of Baofeng Modern Intl | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Baofeng Modern Intl are -
Innovation driven organization
– Baofeng Modern Intl is one of the most innovative firm in Footwear sector.
Organizational Resilience of Baofeng Modern Intl
– The covid-19 pandemic has put organizational resilience at the centre of everthing Baofeng Modern Intl does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Baofeng Modern Intl is one of the leading players in the Footwear industry in Hong Kong. It is in a position to attract the best talent available in Hong Kong. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Baofeng Modern Intl has one of the best training and development program in Consumer Cyclical industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Sustainable margins compare to other players in Footwear industry
– Baofeng Modern Intl has clearly differentiated products in the market place. This has enabled Baofeng Modern Intl to fetch slight price premium compare to the competitors in the Footwear industry. The sustainable margins have also helped Baofeng Modern Intl to invest into research and development (R&D) and innovation.
Digital Transformation in Footwear industry
- digital transformation varies from industry to industry. For Baofeng Modern Intl digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Baofeng Modern Intl has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to lead change in Footwear
– Baofeng Modern Intl is one of the leading players in the Footwear industry in Hong Kong. Over the years it has not only transformed the business landscape in the Footwear industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Baofeng Modern Intl in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Footwear industry
– Baofeng Modern Intl is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Baofeng Modern Intl has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
High brand equity
– Baofeng Modern Intl has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Baofeng Modern Intl to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Baofeng Modern Intl is present in almost all the verticals within the Footwear industry. This has provided Baofeng Modern Intl a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Analytics focus
– Baofeng Modern Intl is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Footwear industry. The technology infrastructure of Hong Kong is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses of Baofeng Modern Intl | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Baofeng Modern Intl are -
High cash cycle compare to competitors
Baofeng Modern Intl has a high cash cycle compare to other players in the Footwear industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– From the outside it seems that Baofeng Modern Intl needs to have more collaboration between its sales team and marketing team. Sales professionals in the Footwear industry have deep experience in developing customer relationships. Marketing department at Baofeng Modern Intl can leverage the sales team experience to cultivate customer relationships as Baofeng Modern Intl is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Baofeng Modern Intl is one of the leading players in the Footwear industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Footwear industry in last five years.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Baofeng Modern Intl supply chain. Even after few cautionary changes, Baofeng Modern Intl is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Baofeng Modern Intl vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– From the 10K / annual statement of Baofeng Modern Intl, it seems that company is thinking out the frontier risks that can impact Footwear industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Baofeng Modern Intl is dominated by functional specialists. It is not different from other players in the Footwear industry, but Baofeng Modern Intl needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Baofeng Modern Intl to focus more on services in the Footwear industry rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Baofeng Modern Intl has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Footwear industry using digital technology.
Lack of clear differentiation of Baofeng Modern Intl products
– To increase the profitability and margins on the products, Baofeng Modern Intl needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Baofeng Modern Intl has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Employees’ less understanding of Baofeng Modern Intl strategy
– From the outside it seems that the employees of Baofeng Modern Intl don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Baofeng Modern Intl is slow explore the new channels of communication. These new channels of communication can help Baofeng Modern Intl to provide better information regarding Footwear products and services. It can also build an online community to further reach out to potential customers.
Baofeng Modern Intl Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Baofeng Modern Intl are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Baofeng Modern Intl can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Baofeng Modern Intl can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Baofeng Modern Intl to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Footwear industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Baofeng Modern Intl can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Baofeng Modern Intl can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Buying journey improvements
– Baofeng Modern Intl can improve the customer journey of consumers in the Footwear industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Loyalty marketing
– Baofeng Modern Intl has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Baofeng Modern Intl to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Baofeng Modern Intl to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Footwear industry, but it has also influenced the consumer preferences. Baofeng Modern Intl can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Baofeng Modern Intl can develop new processes and procedures in Footwear industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Use of Bitcoin and other crypto currencies for transactions in Footwear industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Baofeng Modern Intl in the Footwear industry. Now Baofeng Modern Intl can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Baofeng Modern Intl can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Footwear industry.
Learning at scale
– Online learning technologies has now opened space for Baofeng Modern Intl to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Baofeng Modern Intl can use these opportunities to build new business models that can help the communities that Baofeng Modern Intl operates in. Secondly it can use opportunities from government spending in Footwear sector.
Using analytics as competitive advantage
– Baofeng Modern Intl has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Footwear sector. This continuous investment in analytics has enabled Baofeng Modern Intl to build a competitive advantage using analytics. The analytics driven competitive advantage can help Baofeng Modern Intl to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Baofeng Modern Intl External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Baofeng Modern Intl are -
Consumer confidence and its impact on Baofeng Modern Intl demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Footwear industry and other sectors.
Increasing wage structure of Baofeng Modern Intl
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Baofeng Modern Intl.
Shortening product life cycle
– it is one of the major threat that Baofeng Modern Intl is facing in Footwear sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Baofeng Modern Intl in the Footwear sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Baofeng Modern Intl can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate Baofeng Modern Intl prominent markets.
Easy access to finance
– Easy access to finance in Footwear industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Baofeng Modern Intl can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Baofeng Modern Intl needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Baofeng Modern Intl can take advantage of this fund but it will also bring new competitors in the Footwear industry.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Baofeng Modern Intl in Footwear industry. The Footwear industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High dependence on third party suppliers
– Baofeng Modern Intl high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Baofeng Modern Intl will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Regulatory challenges
– Baofeng Modern Intl needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Footwear industry regulations.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Baofeng Modern Intl business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Baofeng Modern Intl Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Baofeng Modern Intl needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Baofeng Modern Intl is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Baofeng Modern Intl is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Baofeng Modern Intl to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Baofeng Modern Intl needs to make to build a sustainable competitive advantage.