MatsumotoKiyoshi Holdings Co (3088) SWOT Analysis / TOWS Matrix / MBA Resources
Retail (Drugs)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for MatsumotoKiyoshi Holdings Co (Japan)
Based on various researches at Oak Spring University , MatsumotoKiyoshi Holdings Co is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels,
increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of MatsumotoKiyoshi Holdings Co
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that MatsumotoKiyoshi Holdings Co can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the MatsumotoKiyoshi Holdings Co, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co can be done for the following purposes –
1. Strategic planning of MatsumotoKiyoshi Holdings Co
2. Improving business portfolio management of MatsumotoKiyoshi Holdings Co
3. Assessing feasibility of the new initiative in Japan
4. Making a Retail (Drugs) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of MatsumotoKiyoshi Holdings Co
Strengths of MatsumotoKiyoshi Holdings Co | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of MatsumotoKiyoshi Holdings Co are -
Low bargaining power of suppliers
– Suppliers of MatsumotoKiyoshi Holdings Co in the Services sector have low bargaining power. MatsumotoKiyoshi Holdings Co has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps MatsumotoKiyoshi Holdings Co to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– MatsumotoKiyoshi Holdings Co has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – MatsumotoKiyoshi Holdings Co staying ahead in the Retail (Drugs) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– MatsumotoKiyoshi Holdings Co is one of the most innovative firm in Retail (Drugs) sector.
Training and development
– MatsumotoKiyoshi Holdings Co has one of the best training and development program in Services 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.
Ability to recruit top talent
– MatsumotoKiyoshi Holdings Co is one of the leading players in the Retail (Drugs) industry in Japan. It is in a position to attract the best talent available in Japan. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Retail (Drugs)
– MatsumotoKiyoshi Holdings Co is one of the leading players in the Retail (Drugs) industry in Japan. Over the years it has not only transformed the business landscape in the Retail (Drugs) industry in Japan but also across the existing markets. The ability to lead change has enabled MatsumotoKiyoshi Holdings Co in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of MatsumotoKiyoshi Holdings Co
– The covid-19 pandemic has put organizational resilience at the centre of everthing MatsumotoKiyoshi Holdings Co does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of MatsumotoKiyoshi Holdings Co comprises – understanding the underlying the factors in the Retail (Drugs) industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- MatsumotoKiyoshi Holdings Co is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at MatsumotoKiyoshi Holdings Co is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at MatsumotoKiyoshi Holdings Co emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of MatsumotoKiyoshi Holdings Co in Retail (Drugs) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that MatsumotoKiyoshi Holdings Co 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.
Analytics focus
– MatsumotoKiyoshi Holdings Co 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 Retail (Drugs) industry. The technology infrastructure of Japan 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 MatsumotoKiyoshi Holdings Co | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MatsumotoKiyoshi Holdings Co are -
High operating costs
– Compare to the competitors, MatsumotoKiyoshi Holdings Co has high operating costs in the Retail (Drugs) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract MatsumotoKiyoshi Holdings Co lucrative customers.
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 MatsumotoKiyoshi Holdings Co supply chain. Even after few cautionary changes, MatsumotoKiyoshi Holdings Co is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left MatsumotoKiyoshi Holdings Co vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, MatsumotoKiyoshi Holdings Co has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Retail (Drugs) industry over the last five years. MatsumotoKiyoshi Holdings Co even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Interest costs
– Compare to the competition, MatsumotoKiyoshi Holdings Co 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.
Lack of clear differentiation of MatsumotoKiyoshi Holdings Co products
– To increase the profitability and margins on the products, MatsumotoKiyoshi Holdings Co needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Japan, MatsumotoKiyoshi Holdings Co needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, MatsumotoKiyoshi Holdings Co is slow explore the new channels of communication. These new channels of communication can help MatsumotoKiyoshi Holdings Co to provide better information regarding Retail (Drugs) products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– MatsumotoKiyoshi Holdings Co has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Compensation and incentives
– The revenue per employee of MatsumotoKiyoshi Holdings Co is just above the Retail (Drugs) industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Aligning sales with marketing
– From the outside it seems that MatsumotoKiyoshi Holdings Co needs to have more collaboration between its sales team and marketing team. Sales professionals in the Retail (Drugs) industry have deep experience in developing customer relationships. Marketing department at MatsumotoKiyoshi Holdings Co can leverage the sales team experience to cultivate customer relationships as MatsumotoKiyoshi Holdings Co is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, MatsumotoKiyoshi Holdings Co 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 Retail (Drugs) industry using digital technology.
MatsumotoKiyoshi Holdings Co Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of MatsumotoKiyoshi Holdings Co are -
Building a culture of innovation
– managers at MatsumotoKiyoshi Holdings Co 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 Retail (Drugs) industry.
Using analytics as competitive advantage
– MatsumotoKiyoshi Holdings Co has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Retail (Drugs) sector. This continuous investment in analytics has enabled MatsumotoKiyoshi Holdings Co to build a competitive advantage using analytics. The analytics driven competitive advantage can help MatsumotoKiyoshi Holdings Co to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– MatsumotoKiyoshi Holdings Co can use the latest technology developments to improve its manufacturing and designing process in Retail (Drugs) sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Learning at scale
– Online learning technologies has now opened space for MatsumotoKiyoshi Holdings Co 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.
Developing new processes and practices
– MatsumotoKiyoshi Holdings Co can develop new processes and procedures in Retail (Drugs) 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.
Loyalty marketing
– MatsumotoKiyoshi Holdings Co 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. MatsumotoKiyoshi Holdings Co can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects MatsumotoKiyoshi Holdings Co 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, MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, MatsumotoKiyoshi Holdings Co is facing challenges because of the dominance of functional experts in the organization. MatsumotoKiyoshi Holdings Co can utilize new technology in the field of Retail (Drugs) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, MatsumotoKiyoshi Holdings Co can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Creating value in data economy
– The success of analytics program of MatsumotoKiyoshi Holdings Co has opened avenues for new revenue streams for the organization in Retail (Drugs) industry. This can help MatsumotoKiyoshi Holdings Co to build a more holistic ecosystem for MatsumotoKiyoshi Holdings Co products in the Retail (Drugs) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions in Retail (Drugs) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for MatsumotoKiyoshi Holdings Co in the Retail (Drugs) industry. Now MatsumotoKiyoshi Holdings Co can target international markets with far fewer capital restrictions requirements than the existing system.
Threats MatsumotoKiyoshi Holdings Co External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of MatsumotoKiyoshi Holdings Co are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of MatsumotoKiyoshi Holdings Co.
Stagnating economy with rate increase
– MatsumotoKiyoshi Holdings Co can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Retail (Drugs) industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for MatsumotoKiyoshi Holdings Co in Retail (Drugs) industry. The Retail (Drugs) 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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Shortening product life cycle
– it is one of the major threat that MatsumotoKiyoshi Holdings Co is facing in Retail (Drugs) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. MatsumotoKiyoshi Holdings Co 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.
Consumer confidence and its impact on MatsumotoKiyoshi Holdings Co 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 Retail (Drugs) industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, MatsumotoKiyoshi Holdings Co may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Retail (Drugs) sector.
High dependence on third party suppliers
– MatsumotoKiyoshi Holdings Co 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.
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 MatsumotoKiyoshi Holdings Co business can come under increasing regulations regarding data privacy, data security, etc.
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.
Regulatory challenges
– MatsumotoKiyoshi Holdings Co 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 Retail (Drugs) industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co prominent markets.
Weighted SWOT Analysis of MatsumotoKiyoshi Holdings Co Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co needs to make to build a sustainable competitive advantage.
