Qingmei Group Holdings Ltd (QGMI) SWOT Analysis / TOWS Matrix / MBA Resources
Footwear
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Qingmei Group Holdings Ltd (Singapore)
Based on various researches at Oak Spring University , Qingmei Group Holdings Ltd is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, technology disruption, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, geopolitical disruptions, etc
Introduction to SWOT Analysis of Qingmei Group Holdings Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Qingmei Group Holdings Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Qingmei Group Holdings Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Qingmei Group Holdings 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 Qingmei Group Holdings Ltd can be done for the following purposes –
1. Strategic planning of Qingmei Group Holdings Ltd
2. Improving business portfolio management of Qingmei Group Holdings Ltd
3. Assessing feasibility of the new initiative in Singapore
4. Making a Footwear sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Qingmei Group Holdings Ltd
Strengths of Qingmei Group Holdings Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Qingmei Group Holdings Ltd are -
Ability to lead change in Footwear
– Qingmei Group Holdings Ltd is one of the leading players in the Footwear industry in Singapore. Over the years it has not only transformed the business landscape in the Footwear industry in Singapore but also across the existing markets. The ability to lead change has enabled Qingmei Group Holdings Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Qingmei Group Holdings 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.
Low bargaining power of suppliers
– Suppliers of Qingmei Group Holdings Ltd in the Consumer Cyclical sector have low bargaining power. Qingmei Group Holdings Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Qingmei Group Holdings Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Qingmei Group Holdings Ltd in Footwear industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Qingmei Group Holdings Ltd 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 Qingmei Group Holdings Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Qingmei Group Holdings Ltd emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Footwear industry
– Qingmei Group Holdings Ltd has clearly differentiated products in the market place. This has enabled Qingmei Group Holdings Ltd to fetch slight price premium compare to the competitors in the Footwear industry. The sustainable margins have also helped Qingmei Group Holdings Ltd to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Qingmei Group Holdings Ltd is one of the leading players in the Footwear 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.
Training and development
– Qingmei Group Holdings Ltd has one of the best training and development program in Consumer Cyclical 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.
Successful track record of launching new products
– Qingmei Group Holdings Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Qingmei Group Holdings 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.
Diverse revenue streams
– Qingmei Group Holdings Ltd is present in almost all the verticals within the Footwear industry. This has provided Qingmei Group Holdings 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.
Digital Transformation in Footwear industry
- digital transformation varies from industry to industry. For Qingmei Group Holdings Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Qingmei Group Holdings 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.
Organizational Resilience of Qingmei Group Holdings Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Qingmei Group Holdings Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Qingmei Group Holdings Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Qingmei Group Holdings Ltd are -
Increasing silos among functional specialists
– The organizational structure of Qingmei Group Holdings Ltd is dominated by functional specialists. It is not different from other players in the Footwear industry, but Qingmei Group Holdings Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Qingmei Group Holdings Ltd to focus more on services in the Footwear industry rather than just following the product oriented approach.
Need for greater diversity
– Qingmei Group Holdings 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.
High bargaining power of channel partners in Footwear industry
– because of the regulatory requirements in Singapore, Qingmei Group Holdings Ltd 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 Footwear industry.
Low market penetration in new markets
– Outside its home market of Singapore, Qingmei Group Holdings Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Qingmei Group Holdings Ltd is one of the leading players in the Footwear industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Footwear industry in last five years.
Compensation and incentives
– The revenue per employee of Qingmei Group Holdings Ltd is just above the Footwear 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 Footwear industry
– The stress on hiring functional specialists at Qingmei Group Holdings 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.
Employees’ less understanding of Qingmei Group Holdings Ltd strategy
– From the outside it seems that the employees of Qingmei Group Holdings 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.
Ability to respond to the competition
– As the decision making is very deliberative at Qingmei Group Holdings Ltd, in the dynamic environment of Footwear industry it has struggled to respond to the nimble upstart competition. Qingmei Group Holdings Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Qingmei Group Holdings 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 dependence on Qingmei Group Holdings Ltd ‘s star products
– The top 2 products and services of Qingmei Group Holdings Ltd still accounts for major business revenue. This dependence on star products in Footwear industry has resulted into insufficient focus on developing new products, even though Qingmei Group Holdings Ltd has relatively successful track record of launching new products.
Qingmei Group Holdings Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Qingmei Group Holdings Ltd are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Footwear industry, but it has also influenced the consumer preferences. Qingmei Group Holdings Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Qingmei Group Holdings Ltd to increase its market reach. Qingmei Group Holdings Ltd 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.
Buying journey improvements
– Qingmei Group Holdings Ltd can improve the customer journey of consumers in the Footwear 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Qingmei Group Holdings 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 Qingmei Group Holdings 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.
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. Qingmei Group Holdings Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Qingmei Group Holdings Ltd 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Qingmei Group Holdings 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 Footwear industry, and it will provide faster access to the consumers.
Developing new processes and practices
– Qingmei Group Holdings Ltd can develop new processes and procedures in Footwear 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.
Building a culture of innovation
– managers at Qingmei Group Holdings 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 Footwear industry.
Learning at scale
– Online learning technologies has now opened space for Qingmei Group Holdings 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.
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 Qingmei Group Holdings 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Qingmei Group Holdings Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Qingmei Group Holdings 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 Qingmei Group Holdings Ltd to hire the very best people irrespective of their geographical location.
Threats Qingmei Group Holdings Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Qingmei Group Holdings Ltd are -
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 Qingmei Group Holdings Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Qingmei Group Holdings 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 Footwear industry regulations.
Increasing wage structure of Qingmei Group Holdings 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 Qingmei Group Holdings Ltd.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Footwear industry are lowering. It can presents Qingmei Group Holdings Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Footwear sector.
Easy access to finance
– Easy access to finance in Footwear industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Qingmei Group Holdings Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Qingmei Group Holdings 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.
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, Qingmei Group Holdings 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 Qingmei Group Holdings Ltd prominent markets.
Environmental challenges
– Qingmei Group Holdings 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. Qingmei Group Holdings Ltd can take advantage of this fund but it will also bring new competitors in the Footwear industry.
Consumer confidence and its impact on Qingmei Group Holdings 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 Footwear industry and other sectors.
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 Qingmei Group Holdings Ltd.
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. Qingmei Group Holdings Ltd needs to understand the core reasons impacting the Footwear industry. This will help it in building a better workplace.
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.
Weighted SWOT Analysis of Qingmei Group Holdings Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Qingmei Group Holdings 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 Qingmei Group Holdings 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 Qingmei Group Holdings 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 Qingmei Group Holdings 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 Qingmei Group Holdings Ltd needs to make to build a sustainable competitive advantage.
