CLS Holdings USA (CLSH) SWOT Analysis / TOWS Matrix / MBA Resources
Textiles - Non Apparel
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for CLS Holdings USA (United States)
Based on various researches at Oak Spring University , CLS Holdings USA is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, central banks are concerned over increasing inflation, increasing energy prices, cloud computing is disrupting traditional business models, wage bills are increasing, there is increasing trade war between United States & China, technology disruption,
increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that CLS Holdings USA can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the CLS Holdings USA, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which CLS Holdings USA 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 CLS Holdings USA can be done for the following purposes –
1. Strategic planning of CLS Holdings USA
2. Improving business portfolio management of CLS Holdings USA
3. Assessing feasibility of the new initiative in United States
4. Making a Textiles - Non Apparel sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of CLS Holdings USA
Strengths of CLS Holdings USA | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of CLS Holdings USA are -
Cross disciplinary teams
– Horizontal connected teams at the CLS Holdings USA 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.
Strong track record of project management in the Textiles - Non Apparel industry
– CLS Holdings USA is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– CLS Holdings USA has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Textiles - Non Apparel industry. Secondly the value chain collaborators of CLS Holdings USA have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy of CLS Holdings USA comprises – understanding the underlying the factors in the Textiles - Non Apparel 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.
Analytics focus
– CLS Holdings USA 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 Textiles - Non Apparel industry. The technology infrastructure of United States 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.
Organizational Resilience of CLS Holdings USA
– The covid-19 pandemic has put organizational resilience at the centre of everthing CLS Holdings USA does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Textiles - Non Apparel
– CLS Holdings USA is one of the leading players in the Textiles - Non Apparel industry in United States. Over the years it has not only transformed the business landscape in the Textiles - Non Apparel industry in United States but also across the existing markets. The ability to lead change has enabled CLS Holdings USA in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- CLS Holdings USA 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 CLS Holdings USA is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at CLS Holdings USA emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of CLS Holdings USA in the Consumer Cyclical sector have low bargaining power. CLS Holdings USA has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps CLS Holdings USA to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that CLS Holdings USA 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
– CLS Holdings USA is one of the most innovative firm in Textiles - Non Apparel sector.
High brand equity
– CLS Holdings USA has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled CLS Holdings USA to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of CLS Holdings USA | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CLS Holdings USA are -
High cash cycle compare to competitors
CLS Holdings USA has a high cash cycle compare to other players in the Textiles - Non Apparel industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Employees’ less understanding of CLS Holdings USA strategy
– From the outside it seems that the employees of CLS Holdings USA 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.
Skills based hiring in Textiles - Non Apparel industry
– The stress on hiring functional specialists at CLS Holdings USA 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.
Need for greater diversity
– CLS Holdings USA 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.
Products dominated business model
– Even though CLS Holdings USA has some of the most successful models in the Textiles - Non Apparel industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. CLS Holdings USA should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of United States, CLS Holdings USA needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative at CLS Holdings USA, in the dynamic environment of Textiles - Non Apparel industry it has struggled to respond to the nimble upstart competition. CLS Holdings USA has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners in Textiles - Non Apparel industry
– because of the regulatory requirements in United States, CLS Holdings USA 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 Textiles - Non Apparel industry.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, CLS Holdings USA is slow explore the new channels of communication. These new channels of communication can help CLS Holdings USA to provide better information regarding Textiles - Non Apparel products and services. It can also build an online community to further reach out to potential customers.
High dependence on CLS Holdings USA ‘s star products
– The top 2 products and services of CLS Holdings USA still accounts for major business revenue. This dependence on star products in Textiles - Non Apparel industry has resulted into insufficient focus on developing new products, even though CLS Holdings USA has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As CLS Holdings USA is one of the leading players in the Textiles - Non Apparel industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Textiles - Non Apparel industry in last five years.
CLS Holdings USA Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of CLS Holdings USA are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Textiles - Non Apparel industry, but it has also influenced the consumer preferences. CLS Holdings USA 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, CLS Holdings USA 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.
Loyalty marketing
– CLS Holdings USA 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects CLS Holdings USA can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– CLS Holdings USA can improve the customer journey of consumers in the Textiles - Non Apparel 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.
Better consumer reach
– The expansion of the 5G network will help CLS Holdings USA to increase its market reach. CLS Holdings USA 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.
Building a culture of innovation
– managers at CLS Holdings USA 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 Textiles - Non Apparel industry.
Redefining models of collaboration and team work
– As explained in the weaknesses section, CLS Holdings USA is facing challenges because of the dominance of functional experts in the organization. CLS Holdings USA can utilize new technology in the field of Textiles - Non Apparel industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Textiles - Non Apparel industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for CLS Holdings USA in the Textiles - Non Apparel industry. Now CLS Holdings USA can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– CLS Holdings USA has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Textiles - Non Apparel sector. This continuous investment in analytics has enabled CLS Holdings USA to build a competitive advantage using analytics. The analytics driven competitive advantage can help CLS Holdings USA 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 Textiles - Non Apparel industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. CLS Holdings USA 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. CLS Holdings USA 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for CLS Holdings USA 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 CLS Holdings USA to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, CLS Holdings USA 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 CLS Holdings USA to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats CLS Holdings USA External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of CLS Holdings USA are -
Consumer confidence and its impact on CLS Holdings USA 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 Textiles - Non Apparel industry and other sectors.
Regulatory challenges
– CLS Holdings USA 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 Textiles - Non Apparel industry regulations.
High dependence on third party suppliers
– CLS Holdings USA 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, CLS Holdings USA 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 CLS Holdings USA prominent markets.
Easy access to finance
– Easy access to finance in Textiles - Non Apparel industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. CLS Holdings USA can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for CLS Holdings USA in Textiles - Non Apparel industry. The Textiles - Non Apparel 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.
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
– CLS Holdings USA 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 Textiles - Non Apparel industry.
Shortening product life cycle
– it is one of the major threat that CLS Holdings USA is facing in Textiles - Non Apparel sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 CLS Holdings USA in the Textiles - Non Apparel sector and impact the bottomline of the organization.
Environmental challenges
– CLS Holdings USA 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. CLS Holdings USA can take advantage of this fund but it will also bring new competitors in the Textiles - Non Apparel industry.
Increasing wage structure of CLS Holdings USA
– 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 CLS Holdings USA.
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. CLS Holdings USA needs to understand the core reasons impacting the Textiles - Non Apparel industry. This will help it in building a better workplace.
Weighted SWOT Analysis of CLS Holdings USA Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at CLS Holdings USA 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 CLS Holdings USA 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 CLS Holdings USA 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 CLS Holdings USA 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 CLS Holdings USA needs to make to build a sustainable competitive advantage.