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 – technology disruption, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, wage bills are increasing, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies,
supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, 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 -
Strong track record of project management in the Retail (Drugs) industry
– MatsumotoKiyoshi Holdings Co is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
Innovation driven organization
– MatsumotoKiyoshi Holdings Co is one of the most innovative firm in Retail (Drugs) sector.
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.
Diverse revenue streams
– MatsumotoKiyoshi Holdings Co is present in almost all the verticals within the Retail (Drugs) industry. This has provided MatsumotoKiyoshi Holdings Co 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.
High brand equity
– MatsumotoKiyoshi Holdings Co has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled MatsumotoKiyoshi Holdings Co to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
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.
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.
Successful track record of launching new products
– MatsumotoKiyoshi Holdings Co has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. MatsumotoKiyoshi Holdings Co has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
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.
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.
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.
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 -
Products dominated business model
– Even though MatsumotoKiyoshi Holdings Co has some of the most successful models in the Retail (Drugs) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. MatsumotoKiyoshi Holdings Co should strive to include more intangible value offerings along with its core products and services.
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.
Workers concerns about automation
– As automation is fast increasing in the Retail (Drugs) industry, MatsumotoKiyoshi Holdings Co needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
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.
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.
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.
Ability to respond to the competition
– As the decision making is very deliberative at MatsumotoKiyoshi Holdings Co, in the dynamic environment of Retail (Drugs) industry it has struggled to respond to the nimble upstart competition. MatsumotoKiyoshi Holdings Co has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– From the 10K / annual statement of MatsumotoKiyoshi Holdings Co, it seems that company is thinking out the frontier risks that can impact Retail (Drugs) 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.
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.
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 -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, MatsumotoKiyoshi Holdings Co can use these opportunities to build new business models that can help the communities that MatsumotoKiyoshi Holdings Co operates in. Secondly it can use opportunities from government spending in Retail (Drugs) sector.
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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help MatsumotoKiyoshi Holdings Co to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for MatsumotoKiyoshi Holdings Co 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 MatsumotoKiyoshi Holdings Co to hire the very best people irrespective of their geographical location.
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.
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.
Leveraging digital technologies
– MatsumotoKiyoshi Holdings Co can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Drugs) industry, but it has also influenced the consumer preferences. MatsumotoKiyoshi Holdings Co can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
Better consumer reach
– The expansion of the 5G network will help MatsumotoKiyoshi Holdings Co to increase its market reach. MatsumotoKiyoshi Holdings Co will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Retail (Drugs) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. MatsumotoKiyoshi Holdings Co 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. MatsumotoKiyoshi Holdings Co 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.
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.
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 -
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.
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.
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.
Increasing wage structure of MatsumotoKiyoshi Holdings Co
– 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 MatsumotoKiyoshi Holdings Co.
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.
Environmental challenges
– MatsumotoKiyoshi Holdings Co 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. MatsumotoKiyoshi Holdings Co can take advantage of this fund but it will also bring new competitors 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.
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 MatsumotoKiyoshi Holdings Co in the Retail (Drugs) sector and impact the bottomline of the organization.
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.
Easy access to finance
– Easy access to finance in Retail (Drugs) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. MatsumotoKiyoshi Holdings Co can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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.
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.
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.