Nihon Shokuhin Kako (2892) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Nihon Shokuhin Kako (Japan)
Based on various researches at Oak Spring University , Nihon Shokuhin Kako is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, geopolitical disruptions, increasing transportation and logistics costs, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, wage bills are increasing, etc
Introduction to SWOT Analysis of Nihon Shokuhin Kako
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Nihon Shokuhin Kako can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nihon Shokuhin Kako, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nihon Shokuhin Kako 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 Nihon Shokuhin Kako can be done for the following purposes –
1. Strategic planning of Nihon Shokuhin Kako
2. Improving business portfolio management of Nihon Shokuhin Kako
3. Assessing feasibility of the new initiative in Japan
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Nihon Shokuhin Kako
Strengths of Nihon Shokuhin Kako | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nihon Shokuhin Kako are -
Low bargaining power of suppliers
– Suppliers of Nihon Shokuhin Kako in the Consumer/Non-Cyclical sector have low bargaining power. Nihon Shokuhin Kako has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nihon Shokuhin Kako to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Nihon Shokuhin Kako 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 Nihon Shokuhin Kako is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Nihon Shokuhin Kako emphasize – knowledge, initiative, and innovation.
High brand equity
– Nihon Shokuhin Kako has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nihon Shokuhin Kako to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Nihon Shokuhin Kako in Food Processing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Nihon Shokuhin Kako
– The covid-19 pandemic has put organizational resilience at the centre of everthing Nihon Shokuhin Kako does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management in the Food Processing industry
– Nihon Shokuhin Kako is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Nihon Shokuhin Kako 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.
Analytics focus
– Nihon Shokuhin Kako 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 Food Processing 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.
Ability to recruit top talent
– Nihon Shokuhin Kako is one of the leading players in the Food Processing 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.
High switching costs
– The high switching costs that Nihon Shokuhin Kako 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 Food Processing industry
– Nihon Shokuhin Kako has clearly differentiated products in the market place. This has enabled Nihon Shokuhin Kako to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped Nihon Shokuhin Kako to invest into research and development (R&D) and innovation.
Training and development
– Nihon Shokuhin Kako has one of the best training and development program in Consumer/Non-Cyclical industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses of Nihon Shokuhin Kako | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nihon Shokuhin Kako are -
No frontier risks strategy
– From the 10K / annual statement of Nihon Shokuhin Kako, it seems that company is thinking out the frontier risks that can impact Food Processing 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nihon Shokuhin Kako is slow explore the new channels of communication. These new channels of communication can help Nihon Shokuhin Kako to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Nihon Shokuhin Kako has a high cash cycle compare to other players in the Food Processing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of Nihon Shokuhin Kako products
– To increase the profitability and margins on the products, Nihon Shokuhin Kako needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative at Nihon Shokuhin Kako, in the dynamic environment of Food Processing industry it has struggled to respond to the nimble upstart competition. Nihon Shokuhin Kako 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, Nihon Shokuhin Kako 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.
High operating costs
– Compare to the competitors, Nihon Shokuhin Kako has high operating costs in the Food Processing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Nihon Shokuhin Kako lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Nihon Shokuhin Kako is dominated by functional specialists. It is not different from other players in the Food Processing industry, but Nihon Shokuhin Kako needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nihon Shokuhin Kako to focus more on services in the Food Processing industry rather than just following the product oriented approach.
Products dominated business model
– Even though Nihon Shokuhin Kako has some of the most successful models in the Food Processing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Nihon Shokuhin Kako should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Nihon Shokuhin Kako needs to have more collaboration between its sales team and marketing team. Sales professionals in the Food Processing industry have deep experience in developing customer relationships. Marketing department at Nihon Shokuhin Kako can leverage the sales team experience to cultivate customer relationships as Nihon Shokuhin Kako is planning to shift buying processes online.
Employees’ less understanding of Nihon Shokuhin Kako strategy
– From the outside it seems that the employees of Nihon Shokuhin Kako 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.
Nihon Shokuhin Kako Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Nihon Shokuhin Kako are -
Learning at scale
– Online learning technologies has now opened space for Nihon Shokuhin Kako 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.
Loyalty marketing
– Nihon Shokuhin Kako 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.
Buying journey improvements
– Nihon Shokuhin Kako can improve the customer journey of consumers in the Food Processing 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. Nihon Shokuhin Kako can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Nihon Shokuhin Kako has opened avenues for new revenue streams for the organization in Food Processing industry. This can help Nihon Shokuhin Kako to build a more holistic ecosystem for Nihon Shokuhin Kako products in the Food Processing industry by providing – data insight services, data privacy related products, data based consulting services, 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. Nihon Shokuhin Kako can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Nihon Shokuhin Kako 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.
Developing new processes and practices
– Nihon Shokuhin Kako can develop new processes and procedures in Food Processing 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Nihon Shokuhin Kako 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Food Processing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Nihon Shokuhin Kako 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. Nihon Shokuhin Kako 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nihon Shokuhin Kako is facing challenges because of the dominance of functional experts in the organization. Nihon Shokuhin Kako can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Food Processing industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Nihon Shokuhin Kako in the Food Processing industry. Now Nihon Shokuhin Kako can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Nihon Shokuhin Kako can use the latest technology developments to improve its manufacturing and designing process in Food Processing 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.
Threats Nihon Shokuhin Kako External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Nihon Shokuhin Kako are -
Easy access to finance
– Easy access to finance in Food Processing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Nihon Shokuhin Kako 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nihon Shokuhin Kako in Food Processing industry. The Food Processing 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.
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 Nihon Shokuhin Kako.
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. Nihon Shokuhin Kako 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.
Technology acceleration in Forth Industrial Revolution
– Nihon Shokuhin Kako has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, Nihon Shokuhin Kako needs to keep up with the evolution of technology in the Food Processing 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.
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. Nihon Shokuhin Kako needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
Environmental challenges
– Nihon Shokuhin Kako 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. Nihon Shokuhin Kako can take advantage of this fund but it will also bring new competitors in the Food Processing industry.
Regulatory challenges
– Nihon Shokuhin Kako 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 Food Processing industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Nihon Shokuhin Kako may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing sector.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Food Processing industry are lowering. It can presents Nihon Shokuhin Kako with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Food Processing sector.
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 Nihon Shokuhin Kako in the Food Processing sector and impact the bottomline of the organization.
Increasing wage structure of Nihon Shokuhin Kako
– 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 Nihon Shokuhin Kako.
Weighted SWOT Analysis of Nihon Shokuhin Kako Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Nihon Shokuhin Kako 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 Nihon Shokuhin Kako 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 Nihon Shokuhin Kako 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 Nihon Shokuhin Kako 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 Nihon Shokuhin Kako needs to make to build a sustainable competitive advantage.