Based on various researches at Oak Spring University , Etablissementen Fr Colruyt is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing household debt because of falling income levels, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models,
there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Etablissementen Fr Colruyt
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Etablissementen Fr Colruyt can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Etablissementen Fr Colruyt, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt can be done for the following purposes –
1. Strategic planning of Etablissementen Fr Colruyt
2. Improving business portfolio management of Etablissementen Fr Colruyt
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Retail (Grocery) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Etablissementen Fr Colruyt
Strengths of Etablissementen Fr Colruyt | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Etablissementen Fr Colruyt are -
Successful track record of launching new products
– Etablissementen Fr Colruyt has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Etablissementen Fr Colruyt 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.
Cross disciplinary teams
– Horizontal connected teams at the Etablissementen Fr Colruyt 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.
High brand equity
– Etablissementen Fr Colruyt has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Etablissementen Fr Colruyt to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Etablissementen Fr Colruyt in the Services sector have low bargaining power. Etablissementen Fr Colruyt has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Etablissementen Fr Colruyt to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Etablissementen Fr Colruyt 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 (Grocery) industry. The technology infrastructure of United Kingdom 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 lead change in Retail (Grocery)
– Etablissementen Fr Colruyt is one of the leading players in the Retail (Grocery) industry in United Kingdom. Over the years it has not only transformed the business landscape in the Retail (Grocery) industry in United Kingdom but also across the existing markets. The ability to lead change has enabled Etablissementen Fr Colruyt in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Retail (Grocery) industry
– Etablissementen Fr Colruyt has clearly differentiated products in the market place. This has enabled Etablissementen Fr Colruyt to fetch slight price premium compare to the competitors in the Retail (Grocery) industry. The sustainable margins have also helped Etablissementen Fr Colruyt to invest into research and development (R&D) and innovation.
Digital Transformation in Retail (Grocery) industry
- digital transformation varies from industry to industry. For Etablissementen Fr Colruyt digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Etablissementen Fr Colruyt has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Superior customer experience
– The customer experience strategy of Etablissementen Fr Colruyt in Retail (Grocery) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Etablissementen Fr Colruyt 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.
Learning organization
- Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Etablissementen Fr Colruyt emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Etablissementen Fr Colruyt is present in almost all the verticals within the Retail (Grocery) industry. This has provided Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Etablissementen Fr Colruyt are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Etablissementen Fr Colruyt is slow explore the new channels of communication. These new channels of communication can help Etablissementen Fr Colruyt to provide better information regarding Retail (Grocery) products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee of Etablissementen Fr Colruyt is just above the Retail (Grocery) industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Skills based hiring in Retail (Grocery) industry
– The stress on hiring functional specialists at Etablissementen Fr Colruyt 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.
High bargaining power of channel partners in Retail (Grocery) industry
– because of the regulatory requirements in United Kingdom, Etablissementen Fr Colruyt is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Retail (Grocery) industry.
Increasing silos among functional specialists
– The organizational structure of Etablissementen Fr Colruyt is dominated by functional specialists. It is not different from other players in the Retail (Grocery) industry, but Etablissementen Fr Colruyt needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Etablissementen Fr Colruyt to focus more on services in the Retail (Grocery) industry rather than just following the product oriented approach.
Employees’ less understanding of Etablissementen Fr Colruyt strategy
– From the outside it seems that the employees of Etablissementen Fr Colruyt 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.
Capital Spending Reduction
– Even during the low interest decade, Etablissementen Fr Colruyt 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 (Grocery) industry using digital technology.
High operating costs
– Compare to the competitors, Etablissementen Fr Colruyt has high operating costs in the Retail (Grocery) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Etablissementen Fr Colruyt lucrative customers.
Aligning sales with marketing
– From the outside it seems that Etablissementen Fr Colruyt needs to have more collaboration between its sales team and marketing team. Sales professionals in the Retail (Grocery) industry have deep experience in developing customer relationships. Marketing department at Etablissementen Fr Colruyt can leverage the sales team experience to cultivate customer relationships as Etablissementen Fr Colruyt is planning to shift buying processes online.
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 Etablissementen Fr Colruyt supply chain. Even after few cautionary changes, Etablissementen Fr Colruyt is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Etablissementen Fr Colruyt vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Etablissementen Fr Colruyt 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.
Etablissementen Fr Colruyt Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Etablissementen Fr Colruyt are -
Use of Bitcoin and other crypto currencies for transactions in Retail (Grocery) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Etablissementen Fr Colruyt in the Retail (Grocery) industry. Now Etablissementen Fr Colruyt can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Etablissementen Fr Colruyt can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Retail (Grocery) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Etablissementen Fr Colruyt 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. Etablissementen Fr Colruyt 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.
Loyalty marketing
– Etablissementen Fr Colruyt 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.
Better consumer reach
– The expansion of the 5G network will help Etablissementen Fr Colruyt to increase its market reach. Etablissementen Fr Colruyt 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Etablissementen Fr Colruyt in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Retail (Grocery) industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Etablissementen Fr Colruyt can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Retail (Grocery) industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Etablissementen Fr Colruyt can use these opportunities to build new business models that can help the communities that Etablissementen Fr Colruyt operates in. Secondly it can use opportunities from government spending in Retail (Grocery) sector.
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 Etablissementen Fr Colruyt 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.
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. Etablissementen Fr Colruyt can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Grocery) industry, but it has also influenced the consumer preferences. Etablissementen Fr Colruyt can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Etablissementen Fr Colruyt is facing challenges because of the dominance of functional experts in the organization. Etablissementen Fr Colruyt can utilize new technology in the field of Retail (Grocery) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Etablissementen Fr Colruyt External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Etablissementen Fr Colruyt are -
Consumer confidence and its impact on Etablissementen Fr Colruyt 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 Retail (Grocery) industry and other sectors.
Stagnating economy with rate increase
– Etablissementen Fr Colruyt 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 (Grocery) industry.
Increasing wage structure of Etablissementen Fr Colruyt
– 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 Etablissementen Fr Colruyt.
Easy access to finance
– Easy access to finance in Retail (Grocery) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Etablissementen Fr Colruyt can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Etablissementen Fr Colruyt 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 (Grocery) sector.
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 Etablissementen Fr Colruyt.
Technology acceleration in Forth Industrial Revolution
– Etablissementen Fr Colruyt has witnessed rapid integration of technology during Covid-19 in the Retail (Grocery) industry. As one of the leading players in the industry, Etablissementen Fr Colruyt needs to keep up with the evolution of technology in the Retail (Grocery) 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 Retail (Grocery) industry are lowering. It can presents Etablissementen Fr Colruyt with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Retail (Grocery) sector.
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, Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt in the Retail (Grocery) sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Etablissementen Fr Colruyt is facing in Retail (Grocery) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Etablissementen Fr Colruyt business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Etablissementen Fr Colruyt Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt 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 Etablissementen Fr Colruyt needs to make to build a sustainable competitive advantage.