Zhongmin Baihui Retail Group Ltd (ZBRG) SWOT Analysis / TOWS Matrix / MBA Resources
Retail (Department & Discount)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Zhongmin Baihui Retail Group Ltd (Singapore)
Based on various researches at Oak Spring University , Zhongmin Baihui Retail Group Ltd is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, technology disruption, cloud computing is disrupting traditional business models, wage bills are increasing, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%,
there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Zhongmin Baihui Retail Group Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Zhongmin Baihui Retail Group Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Zhongmin Baihui Retail Group Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd can be done for the following purposes –
1. Strategic planning of Zhongmin Baihui Retail Group Ltd
2. Improving business portfolio management of Zhongmin Baihui Retail Group Ltd
3. Assessing feasibility of the new initiative in Singapore
4. Making a Retail (Department & Discount) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Zhongmin Baihui Retail Group Ltd
Strengths of Zhongmin Baihui Retail Group Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Zhongmin Baihui Retail Group Ltd are -
Innovation driven organization
– Zhongmin Baihui Retail Group Ltd is one of the most innovative firm in Retail (Department & Discount) sector.
Ability to lead change in Retail (Department & Discount)
– Zhongmin Baihui Retail Group Ltd is one of the leading players in the Retail (Department & Discount) industry in Singapore. Over the years it has not only transformed the business landscape in the Retail (Department & Discount) industry in Singapore but also across the existing markets. The ability to lead change has enabled Zhongmin Baihui Retail Group Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Retail (Department & Discount) industry
- digital transformation varies from industry to industry. For Zhongmin Baihui Retail Group Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Zhongmin Baihui Retail Group Ltd 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.
Low bargaining power of suppliers
– Suppliers of Zhongmin Baihui Retail Group Ltd in the Services sector have low bargaining power. Zhongmin Baihui Retail Group Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Zhongmin Baihui Retail Group Ltd to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Zhongmin Baihui Retail Group Ltd 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.
Diverse revenue streams
– Zhongmin Baihui Retail Group Ltd is present in almost all the verticals within the Retail (Department & Discount) industry. This has provided Zhongmin Baihui Retail Group Ltd 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.
Superior customer experience
– The customer experience strategy of Zhongmin Baihui Retail Group Ltd in Retail (Department & Discount) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Retail (Department & Discount) industry
– Zhongmin Baihui Retail Group Ltd has clearly differentiated products in the market place. This has enabled Zhongmin Baihui Retail Group Ltd to fetch slight price premium compare to the competitors in the Retail (Department & Discount) industry. The sustainable margins have also helped Zhongmin Baihui Retail Group Ltd to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Zhongmin Baihui Retail Group Ltd is one of the leading players in the Retail (Department & Discount) industry in Singapore. It is in a position to attract the best talent available in Singapore. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Zhongmin Baihui Retail Group Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Zhongmin Baihui Retail Group Ltd 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)
– Zhongmin Baihui Retail Group Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Zhongmin Baihui Retail Group Ltd staying ahead in the Retail (Department & Discount) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Zhongmin Baihui Retail Group Ltd 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.
Weaknesses of Zhongmin Baihui Retail Group Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Zhongmin Baihui Retail Group Ltd are -
Lack of clear differentiation of Zhongmin Baihui Retail Group Ltd products
– To increase the profitability and margins on the products, Zhongmin Baihui Retail Group Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Zhongmin Baihui Retail Group Ltd has some of the most successful models in the Retail (Department & Discount) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Zhongmin Baihui Retail Group Ltd should strive to include more intangible value offerings along with its core products and services.
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 Zhongmin Baihui Retail Group Ltd supply chain. Even after few cautionary changes, Zhongmin Baihui Retail Group Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Zhongmin Baihui Retail Group Ltd vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Singapore, Zhongmin Baihui Retail Group Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ less understanding of Zhongmin Baihui Retail Group Ltd strategy
– From the outside it seems that the employees of Zhongmin Baihui Retail Group Ltd 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Zhongmin Baihui Retail Group Ltd is slow explore the new channels of communication. These new channels of communication can help Zhongmin Baihui Retail Group Ltd to provide better information regarding Retail (Department & Discount) 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 Zhongmin Baihui Retail Group Ltd is just above the Retail (Department & Discount) 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 (Department & Discount) industry
– The stress on hiring functional specialists at Zhongmin Baihui Retail Group Ltd 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.
Capital Spending Reduction
– Even during the low interest decade, Zhongmin Baihui Retail Group Ltd 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 (Department & Discount) industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Zhongmin Baihui Retail Group Ltd has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Retail (Department & Discount) industry over the last five years. Zhongmin Baihui Retail Group Ltd even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Aligning sales with marketing
– From the outside it seems that Zhongmin Baihui Retail Group Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Retail (Department & Discount) industry have deep experience in developing customer relationships. Marketing department at Zhongmin Baihui Retail Group Ltd can leverage the sales team experience to cultivate customer relationships as Zhongmin Baihui Retail Group Ltd is planning to shift buying processes online.
Zhongmin Baihui Retail Group Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Zhongmin Baihui Retail Group Ltd are -
Manufacturing automation
– Zhongmin Baihui Retail Group Ltd can use the latest technology developments to improve its manufacturing and designing process in Retail (Department & Discount) 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
– Zhongmin Baihui Retail Group Ltd 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.
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 Zhongmin Baihui Retail Group Ltd 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Zhongmin Baihui Retail Group Ltd 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 (Department & Discount) industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Zhongmin Baihui Retail Group Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Retail (Department & Discount) sector. This continuous investment in analytics has enabled Zhongmin Baihui Retail Group Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Zhongmin Baihui Retail Group Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Retail (Department & Discount) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Zhongmin Baihui Retail Group Ltd 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. Zhongmin Baihui Retail Group Ltd 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.
Use of Bitcoin and other crypto currencies for transactions in Retail (Department & Discount) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Zhongmin Baihui Retail Group Ltd in the Retail (Department & Discount) industry. Now Zhongmin Baihui Retail Group Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Zhongmin Baihui Retail Group Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Zhongmin Baihui Retail Group Ltd is facing challenges because of the dominance of functional experts in the organization. Zhongmin Baihui Retail Group Ltd can utilize new technology in the field of Retail (Department & Discount) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Zhongmin Baihui Retail Group Ltd can develop new processes and procedures in Retail (Department & Discount) 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, Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Zhongmin Baihui Retail Group Ltd are -
Increasing wage structure of Zhongmin Baihui Retail Group Ltd
– 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 Zhongmin Baihui Retail Group Ltd.
Environmental challenges
– Zhongmin Baihui Retail Group Ltd 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. Zhongmin Baihui Retail Group Ltd can take advantage of this fund but it will also bring new competitors in the Retail (Department & Discount) industry.
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 Zhongmin Baihui Retail Group Ltd in the Retail (Department & Discount) sector and impact the bottomline of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd prominent markets.
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 Zhongmin Baihui Retail Group Ltd.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Zhongmin Baihui Retail Group Ltd in Retail (Department & Discount) industry. The Retail (Department & Discount) 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.
Stagnating economy with rate increase
– Zhongmin Baihui Retail Group Ltd 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 (Department & Discount) industry.
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. Zhongmin Baihui Retail Group Ltd 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Retail (Department & Discount) industry are lowering. It can presents Zhongmin Baihui Retail Group Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Retail (Department & Discount) sector.
Technology acceleration in Forth Industrial Revolution
– Zhongmin Baihui Retail Group Ltd has witnessed rapid integration of technology during Covid-19 in the Retail (Department & Discount) industry. As one of the leading players in the industry, Zhongmin Baihui Retail Group Ltd needs to keep up with the evolution of technology in the Retail (Department & Discount) 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.
Easy access to finance
– Easy access to finance in Retail (Department & Discount) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Zhongmin Baihui Retail Group Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Zhongmin Baihui Retail Group Ltd is facing in Retail (Department & Discount) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Zhongmin Baihui Retail Group Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd 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 Zhongmin Baihui Retail Group Ltd needs to make to build a sustainable competitive advantage.
