Hokkaido Coca Cola Bottling (2573) SWOT Analysis / TOWS Matrix / MBA Resources
Beverages (Nonalcoholic)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Hokkaido Coca Cola Bottling (Japan)
Based on various researches at Oak Spring University , Hokkaido Coca Cola Bottling is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing commodity prices, increasing energy prices, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models,
competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Hokkaido Coca Cola Bottling
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hokkaido Coca Cola Bottling can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hokkaido Coca Cola Bottling, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling can be done for the following purposes –
1. Strategic planning of Hokkaido Coca Cola Bottling
2. Improving business portfolio management of Hokkaido Coca Cola Bottling
3. Assessing feasibility of the new initiative in Japan
4. Making a Beverages (Nonalcoholic) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hokkaido Coca Cola Bottling
Strengths of Hokkaido Coca Cola Bottling | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hokkaido Coca Cola Bottling are -
Analytics focus
– Hokkaido Coca Cola Bottling 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 Beverages (Nonalcoholic) 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.
Operational resilience
– The operational resilience strategy of Hokkaido Coca Cola Bottling comprises – understanding the underlying the factors in the Beverages (Nonalcoholic) 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.
High switching costs
– The high switching costs that Hokkaido Coca Cola Bottling 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.
Sustainable margins compare to other players in Beverages (Nonalcoholic) industry
– Hokkaido Coca Cola Bottling has clearly differentiated products in the market place. This has enabled Hokkaido Coca Cola Bottling to fetch slight price premium compare to the competitors in the Beverages (Nonalcoholic) industry. The sustainable margins have also helped Hokkaido Coca Cola Bottling to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Hokkaido Coca Cola Bottling are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Effective Research and Development (R&D)
– Hokkaido Coca Cola Bottling has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Hokkaido Coca Cola Bottling staying ahead in the Beverages (Nonalcoholic) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Hokkaido Coca Cola Bottling in the Consumer/Non-Cyclical sector have low bargaining power. Hokkaido Coca Cola Bottling has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hokkaido Coca Cola Bottling to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Hokkaido Coca Cola Bottling has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Beverages (Nonalcoholic) industry. Secondly the value chain collaborators of Hokkaido Coca Cola Bottling have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hokkaido Coca Cola Bottling emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Hokkaido Coca Cola Bottling is one of the most innovative firm in Beverages (Nonalcoholic) sector.
High brand equity
– Hokkaido Coca Cola Bottling has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hokkaido Coca Cola Bottling to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Hokkaido Coca Cola Bottling is present in almost all the verticals within the Beverages (Nonalcoholic) industry. This has provided Hokkaido Coca Cola Bottling 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.
Weaknesses of Hokkaido Coca Cola Bottling | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hokkaido Coca Cola Bottling are -
Skills based hiring in Beverages (Nonalcoholic) industry
– The stress on hiring functional specialists at Hokkaido Coca Cola Bottling has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Hokkaido Coca Cola Bottling 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 Beverages (Nonalcoholic) industry using digital technology.
Need for greater diversity
– Hokkaido Coca Cola Bottling 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.
No frontier risks strategy
– From the 10K / annual statement of Hokkaido Coca Cola Bottling, it seems that company is thinking out the frontier risks that can impact Beverages (Nonalcoholic) 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 dependence on Hokkaido Coca Cola Bottling ‘s star products
– The top 2 products and services of Hokkaido Coca Cola Bottling still accounts for major business revenue. This dependence on star products in Beverages (Nonalcoholic) industry has resulted into insufficient focus on developing new products, even though Hokkaido Coca Cola Bottling has relatively successful track record of launching new products.
Employees’ less understanding of Hokkaido Coca Cola Bottling strategy
– From the outside it seems that the employees of Hokkaido Coca Cola Bottling 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.
Ability to respond to the competition
– As the decision making is very deliberative at Hokkaido Coca Cola Bottling, in the dynamic environment of Beverages (Nonalcoholic) industry it has struggled to respond to the nimble upstart competition. Hokkaido Coca Cola Bottling has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– From the outside it seems that Hokkaido Coca Cola Bottling needs to have more collaboration between its sales team and marketing team. Sales professionals in the Beverages (Nonalcoholic) industry have deep experience in developing customer relationships. Marketing department at Hokkaido Coca Cola Bottling can leverage the sales team experience to cultivate customer relationships as Hokkaido Coca Cola Bottling is planning to shift buying processes online.
High operating costs
– Compare to the competitors, Hokkaido Coca Cola Bottling has high operating costs in the Beverages (Nonalcoholic) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Hokkaido Coca Cola Bottling lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Hokkaido Coca Cola Bottling has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Beverages (Nonalcoholic) industry over the last five years. Hokkaido Coca Cola Bottling 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.
Slow to strategic competitive environment developments
– As Hokkaido Coca Cola Bottling is one of the leading players in the Beverages (Nonalcoholic) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Beverages (Nonalcoholic) industry in last five years.
Hokkaido Coca Cola Bottling Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hokkaido Coca Cola Bottling are -
Leveraging digital technologies
– Hokkaido Coca Cola Bottling 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.
Manufacturing automation
– Hokkaido Coca Cola Bottling can use the latest technology developments to improve its manufacturing and designing process in Beverages (Nonalcoholic) 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Beverages (Nonalcoholic) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hokkaido Coca Cola Bottling 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. Hokkaido Coca Cola Bottling 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hokkaido Coca Cola Bottling can use these opportunities to build new business models that can help the communities that Hokkaido Coca Cola Bottling operates in. Secondly it can use opportunities from government spending in Beverages (Nonalcoholic) sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hokkaido Coca Cola Bottling 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.
Better consumer reach
– The expansion of the 5G network will help Hokkaido Coca Cola Bottling to increase its market reach. Hokkaido Coca Cola Bottling 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.
Loyalty marketing
– Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Hokkaido Coca Cola Bottling can improve the customer journey of consumers in the Beverages (Nonalcoholic) 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.
Creating value in data economy
– The success of analytics program of Hokkaido Coca Cola Bottling has opened avenues for new revenue streams for the organization in Beverages (Nonalcoholic) industry. This can help Hokkaido Coca Cola Bottling to build a more holistic ecosystem for Hokkaido Coca Cola Bottling products in the Beverages (Nonalcoholic) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hokkaido Coca Cola Bottling can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions in Beverages (Nonalcoholic) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Hokkaido Coca Cola Bottling in the Beverages (Nonalcoholic) industry. Now Hokkaido Coca Cola Bottling can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hokkaido Coca Cola Bottling is facing challenges because of the dominance of functional experts in the organization. Hokkaido Coca Cola Bottling can utilize new technology in the field of Beverages (Nonalcoholic) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Hokkaido Coca Cola Bottling External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hokkaido Coca Cola Bottling are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Hokkaido Coca Cola Bottling needs to understand the core reasons impacting the Beverages (Nonalcoholic) industry. This will help it in building a better workplace.
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 Hokkaido Coca Cola Bottling.
Consumer confidence and its impact on Hokkaido Coca Cola Bottling 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 Beverages (Nonalcoholic) industry and other sectors.
Stagnating economy with rate increase
– Hokkaido Coca Cola Bottling 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 Beverages (Nonalcoholic) industry.
Environmental challenges
– Hokkaido Coca Cola Bottling 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. Hokkaido Coca Cola Bottling can take advantage of this fund but it will also bring new competitors in the Beverages (Nonalcoholic) industry.
Easy access to finance
– Easy access to finance in Beverages (Nonalcoholic) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hokkaido Coca Cola Bottling can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling prominent markets.
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 Hokkaido Coca Cola Bottling in the Beverages (Nonalcoholic) sector and impact the bottomline of the organization.
Regulatory challenges
– Hokkaido Coca Cola Bottling 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 Beverages (Nonalcoholic) 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 Hokkaido Coca Cola Bottling business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Hokkaido Coca Cola Bottling has witnessed rapid integration of technology during Covid-19 in the Beverages (Nonalcoholic) industry. As one of the leading players in the industry, Hokkaido Coca Cola Bottling needs to keep up with the evolution of technology in the Beverages (Nonalcoholic) sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Beverages (Nonalcoholic) industry are lowering. It can presents Hokkaido Coca Cola Bottling with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Beverages (Nonalcoholic) sector.
Weighted SWOT Analysis of Hokkaido Coca Cola Bottling Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling 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 Hokkaido Coca Cola Bottling needs to make to build a sustainable competitive advantage.
