SWOT Analysis / TOWS Matrix for Sugimura Warehouse (Japan)
Based on various researches at Oak Spring University , Sugimura Warehouse is operating in a macro-environment that has been destablized by – wage bills are increasing, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing commodity prices, increasing energy prices, digital marketing is dominated by two big players Facebook and Google,
geopolitical disruptions, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Sugimura Warehouse
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sugimura Warehouse can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sugimura Warehouse, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sugimura Warehouse 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 Sugimura Warehouse can be done for the following purposes –
1. Strategic planning of Sugimura Warehouse
2. Improving business portfolio management of Sugimura Warehouse
3. Assessing feasibility of the new initiative in Japan
4. Making a Misc. Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sugimura Warehouse
Strengths of Sugimura Warehouse | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sugimura Warehouse are -
Training and development
– Sugimura Warehouse has one of the best training and development program in Transportation 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.
Learning organization
- Sugimura Warehouse 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 Sugimura Warehouse is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Sugimura Warehouse emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy of Sugimura Warehouse comprises – understanding the underlying the factors in the Misc. Transportation 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.
Ability to recruit top talent
– Sugimura Warehouse is one of the leading players in the Misc. Transportation 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.
Strong track record of project management in the Misc. Transportation industry
– Sugimura Warehouse is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Sugimura Warehouse in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Misc. Transportation
– Sugimura Warehouse is one of the leading players in the Misc. Transportation industry in Japan. Over the years it has not only transformed the business landscape in the Misc. Transportation industry in Japan but also across the existing markets. The ability to lead change has enabled Sugimura Warehouse in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Sugimura Warehouse has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Sugimura Warehouse staying ahead in the Misc. Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Sugimura Warehouse has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sugimura Warehouse to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Sugimura Warehouse in the Transportation sector have low bargaining power. Sugimura Warehouse has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sugimura Warehouse to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Sugimura Warehouse 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 Misc. Transportation 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.
Sustainable margins compare to other players in Misc. Transportation industry
– Sugimura Warehouse has clearly differentiated products in the market place. This has enabled Sugimura Warehouse to fetch slight price premium compare to the competitors in the Misc. Transportation industry. The sustainable margins have also helped Sugimura Warehouse to invest into research and development (R&D) and innovation.
Weaknesses of Sugimura Warehouse | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sugimura Warehouse are -
Increasing silos among functional specialists
– The organizational structure of Sugimura Warehouse is dominated by functional specialists. It is not different from other players in the Misc. Transportation industry, but Sugimura Warehouse needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sugimura Warehouse to focus more on services in the Misc. Transportation industry rather than just following the product oriented approach.
High cash cycle compare to competitors
Sugimura Warehouse has a high cash cycle compare to other players in the Misc. Transportation 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 Sugimura Warehouse needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Transportation industry have deep experience in developing customer relationships. Marketing department at Sugimura Warehouse can leverage the sales team experience to cultivate customer relationships as Sugimura Warehouse is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sugimura Warehouse is slow explore the new channels of communication. These new channels of communication can help Sugimura Warehouse to provide better information regarding Misc. Transportation products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Sugimura Warehouse has some of the most successful models in the Misc. Transportation industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Sugimura Warehouse should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative at Sugimura Warehouse, in the dynamic environment of Misc. Transportation industry it has struggled to respond to the nimble upstart competition. Sugimura Warehouse has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Sugimura Warehouse 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.
Slow to strategic competitive environment developments
– As Sugimura Warehouse is one of the leading players in the Misc. Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Transportation 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 Sugimura Warehouse supply chain. Even after few cautionary changes, Sugimura Warehouse is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sugimura Warehouse vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of Sugimura Warehouse strategy
– From the outside it seems that the employees of Sugimura Warehouse 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.
No frontier risks strategy
– From the 10K / annual statement of Sugimura Warehouse, it seems that company is thinking out the frontier risks that can impact Misc. Transportation 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.
Sugimura Warehouse Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sugimura Warehouse are -
Use of Bitcoin and other crypto currencies for transactions in Misc. Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Sugimura Warehouse in the Misc. Transportation industry. Now Sugimura Warehouse can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sugimura Warehouse 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 Sugimura Warehouse to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sugimura Warehouse can use these opportunities to build new business models that can help the communities that Sugimura Warehouse operates in. Secondly it can use opportunities from government spending in Misc. Transportation sector.
Leveraging digital technologies
– Sugimura Warehouse 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.
Learning at scale
– Online learning technologies has now opened space for Sugimura Warehouse 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 Sugimura Warehouse 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sugimura Warehouse 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 Sugimura Warehouse to increase its market reach. Sugimura Warehouse 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.
Building a culture of innovation
– managers at Sugimura Warehouse 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 Misc. Transportation industry.
Developing new processes and practices
– Sugimura Warehouse can develop new processes and procedures in Misc. Transportation 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sugimura Warehouse in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Transportation industry, and it will provide faster access to the consumers.
Loyalty marketing
– Sugimura Warehouse 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. Sugimura Warehouse can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Sugimura Warehouse External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sugimura Warehouse 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 Sugimura Warehouse.
Consumer confidence and its impact on Sugimura Warehouse 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 Misc. Transportation industry and other sectors.
Increasing wage structure of Sugimura Warehouse
– 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 Sugimura Warehouse.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Sugimura Warehouse may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Transportation sector.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Transportation industry are lowering. It can presents Sugimura Warehouse with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Transportation sector.
Shortening product life cycle
– it is one of the major threat that Sugimura Warehouse is facing in Misc. Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sugimura Warehouse in Misc. Transportation industry. The Misc. Transportation 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 Sugimura Warehouse in the Misc. Transportation sector and impact the bottomline of the organization.
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.
Environmental challenges
– Sugimura Warehouse 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. Sugimura Warehouse can take advantage of this fund but it will also bring new competitors in the Misc. Transportation industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sugimura Warehouse 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 Sugimura Warehouse prominent markets.
Easy access to finance
– Easy access to finance in Misc. Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Sugimura Warehouse can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Sugimura Warehouse 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 Misc. Transportation industry.
Weighted SWOT Analysis of Sugimura Warehouse Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sugimura Warehouse 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 Sugimura Warehouse 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 Sugimura Warehouse 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 Sugimura Warehouse 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 Sugimura Warehouse needs to make to build a sustainable competitive advantage.
