SWOT Analysis / TOWS Matrix for Kyoto Kimono Yuzen (Japan)
Based on various researches at Oak Spring University , Kyoto Kimono Yuzen is operating in a macro-environment that has been destablized by – increasing commodity prices, increasing household debt because of falling income levels, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, technology disruption, there is increasing trade war between United States & China, central banks are concerned over increasing inflation,
wage bills are increasing, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Kyoto Kimono Yuzen
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kyoto Kimono Yuzen can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kyoto Kimono Yuzen, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen can be done for the following purposes –
1. Strategic planning of Kyoto Kimono Yuzen
2. Improving business portfolio management of Kyoto Kimono Yuzen
3. Assessing feasibility of the new initiative in Japan
4. Making a Retail (Apparel) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kyoto Kimono Yuzen
Strengths of Kyoto Kimono Yuzen | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kyoto Kimono Yuzen are -
Sustainable margins compare to other players in Retail (Apparel) industry
– Kyoto Kimono Yuzen has clearly differentiated products in the market place. This has enabled Kyoto Kimono Yuzen to fetch slight price premium compare to the competitors in the Retail (Apparel) industry. The sustainable margins have also helped Kyoto Kimono Yuzen to invest into research and development (R&D) and innovation.
Ability to lead change in Retail (Apparel)
– Kyoto Kimono Yuzen is one of the leading players in the Retail (Apparel) industry in Japan. Over the years it has not only transformed the business landscape in the Retail (Apparel) industry in Japan but also across the existing markets. The ability to lead change has enabled Kyoto Kimono Yuzen in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Kyoto Kimono Yuzen has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Retail (Apparel) industry. Secondly the value chain collaborators of Kyoto Kimono Yuzen have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Kyoto Kimono Yuzen is one of the leading players in the Retail (Apparel) 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 Kyoto Kimono Yuzen has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Analytics focus
– Kyoto Kimono Yuzen 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 (Apparel) 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 Kyoto Kimono Yuzen comprises – understanding the underlying the factors in the Retail (Apparel) 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.
Low bargaining power of suppliers
– Suppliers of Kyoto Kimono Yuzen in the Services sector have low bargaining power. Kyoto Kimono Yuzen has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kyoto Kimono Yuzen to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Kyoto Kimono Yuzen has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kyoto Kimono Yuzen 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.
Training and development
– Kyoto Kimono Yuzen 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.
Strong track record of project management in the Retail (Apparel) industry
– Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen in Retail (Apparel) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Kyoto Kimono Yuzen | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kyoto Kimono Yuzen are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kyoto Kimono Yuzen is slow explore the new channels of communication. These new channels of communication can help Kyoto Kimono Yuzen to provide better information regarding Retail (Apparel) products and services. It can also build an online community to further reach out to potential customers.
Employees’ less understanding of Kyoto Kimono Yuzen strategy
– From the outside it seems that the employees of Kyoto Kimono Yuzen 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.
Interest costs
– Compare to the competition, Kyoto Kimono Yuzen 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 cash cycle compare to competitors
Kyoto Kimono Yuzen has a high cash cycle compare to other players in the Retail (Apparel) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– From the 10K / annual statement of Kyoto Kimono Yuzen, it seems that company is thinking out the frontier risks that can impact Retail (Apparel) 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.
Low market penetration in new markets
– Outside its home market of Japan, Kyoto Kimono Yuzen needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Kyoto Kimono Yuzen supply chain. Even after few cautionary changes, Kyoto Kimono Yuzen is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kyoto Kimono Yuzen vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Kyoto Kimono Yuzen is one of the leading players in the Retail (Apparel) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Retail (Apparel) industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Kyoto Kimono Yuzen is dominated by functional specialists. It is not different from other players in the Retail (Apparel) industry, but Kyoto Kimono Yuzen needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kyoto Kimono Yuzen to focus more on services in the Retail (Apparel) industry rather than just following the product oriented approach.
Aligning sales with marketing
– From the outside it seems that Kyoto Kimono Yuzen needs to have more collaboration between its sales team and marketing team. Sales professionals in the Retail (Apparel) industry have deep experience in developing customer relationships. Marketing department at Kyoto Kimono Yuzen can leverage the sales team experience to cultivate customer relationships as Kyoto Kimono Yuzen is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Kyoto Kimono Yuzen 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 (Apparel) industry using digital technology.
Kyoto Kimono Yuzen Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kyoto Kimono Yuzen are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Apparel) industry, but it has also influenced the consumer preferences. Kyoto Kimono Yuzen can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Kyoto Kimono Yuzen can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Kyoto Kimono Yuzen can improve the customer journey of consumers in the Retail (Apparel) 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions in Retail (Apparel) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Kyoto Kimono Yuzen in the Retail (Apparel) industry. Now Kyoto Kimono Yuzen can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Kyoto Kimono Yuzen to increase its market reach. Kyoto Kimono Yuzen 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kyoto Kimono Yuzen can use these opportunities to build new business models that can help the communities that Kyoto Kimono Yuzen operates in. Secondly it can use opportunities from government spending in Retail (Apparel) sector.
Learning at scale
– Online learning technologies has now opened space for Kyoto Kimono Yuzen 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.
Manufacturing automation
– Kyoto Kimono Yuzen can use the latest technology developments to improve its manufacturing and designing process in Retail (Apparel) 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.
Loyalty marketing
– Kyoto Kimono Yuzen 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Retail (Apparel) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kyoto Kimono Yuzen 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. Kyoto Kimono Yuzen 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.
Using analytics as competitive advantage
– Kyoto Kimono Yuzen has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Retail (Apparel) sector. This continuous investment in analytics has enabled Kyoto Kimono Yuzen to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kyoto Kimono Yuzen to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Kyoto Kimono Yuzen External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kyoto Kimono Yuzen are -
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.
Shortening product life cycle
– it is one of the major threat that Kyoto Kimono Yuzen is facing in Retail (Apparel) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Kyoto Kimono Yuzen 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 (Apparel) industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kyoto Kimono Yuzen in Retail (Apparel) industry. The Retail (Apparel) 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 Kyoto Kimono Yuzen in the Retail (Apparel) sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Retail (Apparel) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Kyoto Kimono Yuzen may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Retail (Apparel) sector.
Technology acceleration in Forth Industrial Revolution
– Kyoto Kimono Yuzen has witnessed rapid integration of technology during Covid-19 in the Retail (Apparel) industry. As one of the leading players in the industry, Kyoto Kimono Yuzen needs to keep up with the evolution of technology in the Retail (Apparel) 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.
Environmental challenges
– Kyoto Kimono Yuzen 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. Kyoto Kimono Yuzen can take advantage of this fund but it will also bring new competitors in the Retail (Apparel) industry.
Increasing wage structure of Kyoto Kimono Yuzen
– 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 Kyoto Kimono Yuzen.
Regulatory challenges
– Kyoto Kimono Yuzen 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 (Apparel) industry regulations.
Weighted SWOT Analysis of Kyoto Kimono Yuzen Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen 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 Kyoto Kimono Yuzen needs to make to build a sustainable competitive advantage.
