River and Mercantile Group PLC (RIV) SWOT Analysis / TOWS Matrix / MBA Resources
Investment Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for River and Mercantile Group PLC (United Kingdom)
Based on various researches at Oak Spring University , River and Mercantile Group PLC is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
increasing energy prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of River and Mercantile Group PLC
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that River and Mercantile Group PLC can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the River and Mercantile Group PLC, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which River and Mercantile Group PLC 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 River and Mercantile Group PLC can be done for the following purposes –
1. Strategic planning of River and Mercantile Group PLC
2. Improving business portfolio management of River and Mercantile Group PLC
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Investment Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of River and Mercantile Group PLC
Strengths of River and Mercantile Group PLC | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of River and Mercantile Group PLC are -
High switching costs
– The high switching costs that River and Mercantile Group PLC 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.
Innovation driven organization
– River and Mercantile Group PLC is one of the most innovative firm in Investment Services sector.
Operational resilience
– The operational resilience strategy of River and Mercantile Group PLC comprises – understanding the underlying the factors in the Investment Services 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.
Sustainable margins compare to other players in Investment Services industry
– River and Mercantile Group PLC has clearly differentiated products in the market place. This has enabled River and Mercantile Group PLC to fetch slight price premium compare to the competitors in the Investment Services industry. The sustainable margins have also helped River and Mercantile Group PLC to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– River and Mercantile Group PLC has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Investment Services industry. Secondly the value chain collaborators of River and Mercantile Group PLC have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the Investment Services industry
– River and Mercantile Group PLC 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 River and Mercantile Group PLC in Investment Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– River and Mercantile Group PLC has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. River and Mercantile Group PLC 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.
Effective Research and Development (R&D)
– River and Mercantile Group PLC has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – River and Mercantile Group PLC staying ahead in the Investment Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Investment Services
– River and Mercantile Group PLC is one of the leading players in the Investment Services industry in United Kingdom. Over the years it has not only transformed the business landscape in the Investment Services industry in United Kingdom but also across the existing markets. The ability to lead change has enabled River and Mercantile Group PLC in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– River and Mercantile Group PLC 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 Investment Services 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.
Learning organization
- River and Mercantile Group PLC 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 River and Mercantile Group PLC is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at River and Mercantile Group PLC emphasize – knowledge, initiative, and innovation.
Weaknesses of River and Mercantile Group PLC | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of River and Mercantile Group PLC are -
High dependence on River and Mercantile Group PLC ‘s star products
– The top 2 products and services of River and Mercantile Group PLC still accounts for major business revenue. This dependence on star products in Investment Services industry has resulted into insufficient focus on developing new products, even though River and Mercantile Group PLC has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at River and Mercantile Group PLC, in the dynamic environment of Investment Services industry it has struggled to respond to the nimble upstart competition. River and Mercantile Group PLC has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, River and Mercantile Group PLC is slow explore the new channels of communication. These new channels of communication can help River and Mercantile Group PLC to provide better information regarding Investment Services products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– From the outside it seems that River and Mercantile Group PLC needs to have more collaboration between its sales team and marketing team. Sales professionals in the Investment Services industry have deep experience in developing customer relationships. Marketing department at River and Mercantile Group PLC can leverage the sales team experience to cultivate customer relationships as River and Mercantile Group PLC is planning to shift buying processes online.
No frontier risks strategy
– From the 10K / annual statement of River and Mercantile Group PLC, it seems that company is thinking out the frontier risks that can impact Investment Services 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.
Products dominated business model
– Even though River and Mercantile Group PLC has some of the most successful models in the Investment Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. River and Mercantile Group PLC should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the Investment Services industry, River and Mercantile Group PLC needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Employees’ less understanding of River and Mercantile Group PLC strategy
– From the outside it seems that the employees of River and Mercantile Group PLC 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.
High cash cycle compare to competitors
River and Mercantile Group PLC has a high cash cycle compare to other players in the Investment Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As River and Mercantile Group PLC is one of the leading players in the Investment Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Investment Services industry in last five years.
High bargaining power of channel partners in Investment Services industry
– because of the regulatory requirements in United Kingdom, River and Mercantile Group PLC 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 Investment Services industry.
River and Mercantile Group PLC Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of River and Mercantile Group PLC are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects River and Mercantile Group PLC can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of River and Mercantile Group PLC has opened avenues for new revenue streams for the organization in Investment Services industry. This can help River and Mercantile Group PLC to build a more holistic ecosystem for River and Mercantile Group PLC products in the Investment Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, River and Mercantile Group PLC 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 River and Mercantile Group PLC to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Investment Services industry, but it has also influenced the consumer preferences. River and Mercantile Group PLC can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– River and Mercantile Group PLC 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, River and Mercantile Group PLC can use these opportunities to build new business models that can help the communities that River and Mercantile Group PLC operates in. Secondly it can use opportunities from government spending in Investment Services sector.
Buying journey improvements
– River and Mercantile Group PLC can improve the customer journey of consumers in the Investment Services 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.
Using analytics as competitive advantage
– River and Mercantile Group PLC has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Investment Services sector. This continuous investment in analytics has enabled River and Mercantile Group PLC to build a competitive advantage using analytics. The analytics driven competitive advantage can help River and Mercantile Group PLC to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– River and Mercantile Group PLC can develop new processes and procedures in Investment Services 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, River and Mercantile Group PLC is facing challenges because of the dominance of functional experts in the organization. River and Mercantile Group PLC can utilize new technology in the field of Investment Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– River and Mercantile Group PLC 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 Investment Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. River and Mercantile Group PLC 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. River and Mercantile Group PLC 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, River and Mercantile Group PLC 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.
Threats River and Mercantile Group PLC External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of River and Mercantile Group PLC are -
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 River and Mercantile Group PLC in the Investment Services sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, River and Mercantile Group PLC 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 River and Mercantile Group PLC prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for River and Mercantile Group PLC in Investment Services industry. The Investment Services 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.
Shortening product life cycle
– it is one of the major threat that River and Mercantile Group PLC is facing in Investment Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Investment Services industry are lowering. It can presents River and Mercantile Group PLC with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Investment Services sector.
Technology acceleration in Forth Industrial Revolution
– River and Mercantile Group PLC has witnessed rapid integration of technology during Covid-19 in the Investment Services industry. As one of the leading players in the industry, River and Mercantile Group PLC needs to keep up with the evolution of technology in the Investment Services 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.
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.
Easy access to finance
– Easy access to finance in Investment Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. River and Mercantile Group PLC can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on River and Mercantile Group PLC 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 Investment Services industry and other sectors.
Regulatory challenges
– River and Mercantile Group PLC 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 Investment Services industry regulations.
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.
Stagnating economy with rate increase
– River and Mercantile Group PLC 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 Investment Services industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, River and Mercantile Group PLC may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Investment Services sector.
Weighted SWOT Analysis of River and Mercantile Group PLC Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at River and Mercantile Group PLC 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 River and Mercantile Group PLC 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 River and Mercantile Group PLC 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 River and Mercantile Group PLC 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 River and Mercantile Group PLC needs to make to build a sustainable competitive advantage.