Japan Foods Holding Ltd (JPFD) SWOT Analysis / TOWS Matrix / MBA Resources
Restaurants
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Japan Foods Holding Ltd (Singapore)
Based on various researches at Oak Spring University , Japan Foods Holding Ltd is operating in a macro-environment that has been destablized by – increasing energy prices, challanges to central banks by blockchain based private currencies, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, increasing commodity prices, wage bills are increasing,
increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Japan Foods Holding Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Japan Foods Holding Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Japan Foods Holding Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Japan Foods Holding 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 Japan Foods Holding Ltd can be done for the following purposes –
1. Strategic planning of Japan Foods Holding Ltd
2. Improving business portfolio management of Japan Foods Holding Ltd
3. Assessing feasibility of the new initiative in Singapore
4. Making a Restaurants sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Japan Foods Holding Ltd
Strengths of Japan Foods Holding Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Japan Foods Holding Ltd are -
Operational resilience
– The operational resilience strategy of Japan Foods Holding Ltd comprises – understanding the underlying the factors in the Restaurants 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.
Highly skilled collaborators
– Japan Foods Holding Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Restaurants industry. Secondly the value chain collaborators of Japan Foods Holding Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Japan Foods Holding Ltd is present in almost all the verticals within the Restaurants industry. This has provided Japan Foods Holding 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.
High brand equity
– Japan Foods Holding Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Japan Foods Holding Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Japan Foods Holding Ltd is one of the most innovative firm in Restaurants sector.
Ability to recruit top talent
– Japan Foods Holding Ltd is one of the leading players in the Restaurants 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.
Sustainable margins compare to other players in Restaurants industry
– Japan Foods Holding Ltd has clearly differentiated products in the market place. This has enabled Japan Foods Holding Ltd to fetch slight price premium compare to the competitors in the Restaurants industry. The sustainable margins have also helped Japan Foods Holding Ltd to invest into research and development (R&D) and innovation.
Organizational Resilience of Japan Foods Holding Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Japan Foods Holding Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Restaurants industry
- digital transformation varies from industry to industry. For Japan Foods Holding Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Japan Foods Holding 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.
Effective Research and Development (R&D)
– Japan Foods Holding Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Japan Foods Holding Ltd staying ahead in the Restaurants industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management in the Restaurants industry
– Japan Foods Holding Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Japan Foods Holding Ltd in the Services sector have low bargaining power. Japan Foods Holding Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Japan Foods Holding Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Japan Foods Holding Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Japan Foods Holding Ltd are -
Employees’ less understanding of Japan Foods Holding Ltd strategy
– From the outside it seems that the employees of Japan Foods Holding 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 decision making process
– As mentioned earlier in the report, Japan Foods Holding 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 Restaurants industry over the last five years. Japan Foods Holding 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.
Capital Spending Reduction
– Even during the low interest decade, Japan Foods Holding 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 Restaurants industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative at Japan Foods Holding Ltd, in the dynamic environment of Restaurants industry it has struggled to respond to the nimble upstart competition. Japan Foods Holding Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee of Japan Foods Holding Ltd is just above the Restaurants 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.
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 Japan Foods Holding Ltd supply chain. Even after few cautionary changes, Japan Foods Holding Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Japan Foods Holding Ltd vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Japan Foods Holding Ltd 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
Japan Foods Holding Ltd has a high cash cycle compare to other players in the Restaurants industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Need for greater diversity
– Japan Foods Holding Ltd has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Workers concerns about automation
– As automation is fast increasing in the Restaurants industry, Japan Foods Holding Ltd 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.
Skills based hiring in Restaurants industry
– The stress on hiring functional specialists at Japan Foods Holding 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.
Japan Foods Holding Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Japan Foods Holding Ltd are -
Creating value in data economy
– The success of analytics program of Japan Foods Holding Ltd has opened avenues for new revenue streams for the organization in Restaurants industry. This can help Japan Foods Holding Ltd to build a more holistic ecosystem for Japan Foods Holding Ltd products in the Restaurants industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Japan Foods Holding Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Restaurants sector. This continuous investment in analytics has enabled Japan Foods Holding Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Japan Foods Holding Ltd 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
– Japan Foods Holding Ltd can develop new processes and procedures in Restaurants 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Japan Foods Holding Ltd can use these opportunities to build new business models that can help the communities that Japan Foods Holding Ltd operates in. Secondly it can use opportunities from government spending in Restaurants sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Japan Foods Holding Ltd is facing challenges because of the dominance of functional experts in the organization. Japan Foods Holding Ltd can utilize new technology in the field of Restaurants industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Restaurants industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Japan Foods Holding 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. Japan Foods Holding 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Restaurants industry, but it has also influenced the consumer preferences. Japan Foods Holding Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Japan Foods Holding 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.
Manufacturing automation
– Japan Foods Holding Ltd can use the latest technology developments to improve its manufacturing and designing process in Restaurants 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.
Learning at scale
– Online learning technologies has now opened space for Japan Foods Holding Ltd 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.
Building a culture of innovation
– managers at Japan Foods Holding Ltd 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 Restaurants industry.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Japan Foods Holding Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Japan Foods Holding 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 Restaurants industry, and it will provide faster access to the consumers.
Threats Japan Foods Holding Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Japan Foods Holding Ltd are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Japan Foods Holding Ltd needs to understand the core reasons impacting the Restaurants industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Japan Foods Holding Ltd high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
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. Japan Foods Holding 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.
Regulatory challenges
– Japan Foods Holding Ltd 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 Restaurants industry regulations.
Increasing wage structure of Japan Foods Holding 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 Japan Foods Holding Ltd.
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 Japan Foods Holding Ltd.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Japan Foods Holding Ltd in Restaurants industry. The Restaurants 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Japan Foods Holding 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 Japan Foods Holding Ltd prominent markets.
Stagnating economy with rate increase
– Japan Foods Holding 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 Restaurants industry.
Consumer confidence and its impact on Japan Foods Holding Ltd 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 Restaurants industry and other sectors.
Easy access to finance
– Easy access to finance in Restaurants industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Japan Foods Holding 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 Japan Foods Holding Ltd is facing in Restaurants sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Japan Foods Holding Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Japan Foods Holding 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 Japan Foods Holding 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 Japan Foods Holding 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 Japan Foods Holding 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 Japan Foods Holding Ltd needs to make to build a sustainable competitive advantage.