John B Sanfilippo&Son (JBSS) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for John B Sanfilippo&Son (United States)
Based on various researches at Oak Spring University , John B Sanfilippo&Son is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, increasing energy prices,
wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of John B Sanfilippo&Son
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that John B Sanfilippo&Son can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the John B Sanfilippo&Son, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which John B Sanfilippo&Son 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 John B Sanfilippo&Son can be done for the following purposes –
1. Strategic planning of John B Sanfilippo&Son
2. Improving business portfolio management of John B Sanfilippo&Son
3. Assessing feasibility of the new initiative in United States
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of John B Sanfilippo&Son
Strengths of John B Sanfilippo&Son | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of John B Sanfilippo&Son are -
High brand equity
– John B Sanfilippo&Son has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled John B Sanfilippo&Son to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy of John B Sanfilippo&Son comprises – understanding the underlying the factors in the Food Processing 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.
Training and development
– John B Sanfilippo&Son has one of the best training and development program in Consumer/Non-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.
High switching costs
– The high switching costs that John B Sanfilippo&Son 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.
Highly skilled collaborators
– John B Sanfilippo&Son has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Food Processing industry. Secondly the value chain collaborators of John B Sanfilippo&Son have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– John B Sanfilippo&Son is present in almost all the verticals within the Food Processing industry. This has provided John B Sanfilippo&Son 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.
Sustainable margins compare to other players in Food Processing industry
– John B Sanfilippo&Son has clearly differentiated products in the market place. This has enabled John B Sanfilippo&Son to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped John B Sanfilippo&Son to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– John B Sanfilippo&Son has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. John B Sanfilippo&Son 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.
Low bargaining power of suppliers
– Suppliers of John B Sanfilippo&Son in the Consumer/Non-Cyclical sector have low bargaining power. John B Sanfilippo&Son has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps John B Sanfilippo&Son to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the Food Processing industry
– John B Sanfilippo&Son is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Food Processing
– John B Sanfilippo&Son is one of the leading players in the Food Processing industry in United States. Over the years it has not only transformed the business landscape in the Food Processing industry in United States but also across the existing markets. The ability to lead change has enabled John B Sanfilippo&Son in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Food Processing industry
- digital transformation varies from industry to industry. For John B Sanfilippo&Son digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. John B Sanfilippo&Son 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.
Weaknesses of John B Sanfilippo&Son | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of John B Sanfilippo&Son are -
High operating costs
– Compare to the competitors, John B Sanfilippo&Son has high operating costs in the Food Processing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract John B Sanfilippo&Son lucrative customers.
Low market penetration in new markets
– Outside its home market of United States, John B Sanfilippo&Son needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on John B Sanfilippo&Son ‘s star products
– The top 2 products and services of John B Sanfilippo&Son still accounts for major business revenue. This dependence on star products in Food Processing industry has resulted into insufficient focus on developing new products, even though John B Sanfilippo&Son has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, John B Sanfilippo&Son has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Food Processing industry over the last five years. John B Sanfilippo&Son 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.
Lack of clear differentiation of John B Sanfilippo&Son products
– To increase the profitability and margins on the products, John B Sanfilippo&Son needs to provide more differentiated products than what it is currently offering in the marketplace.
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 John B Sanfilippo&Son supply chain. Even after few cautionary changes, John B Sanfilippo&Son is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left John B Sanfilippo&Son vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, John B Sanfilippo&Son is slow explore the new channels of communication. These new channels of communication can help John B Sanfilippo&Son to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative at John B Sanfilippo&Son, in the dynamic environment of Food Processing industry it has struggled to respond to the nimble upstart competition. John B Sanfilippo&Son 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, John B Sanfilippo&Son 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.
No frontier risks strategy
– From the 10K / annual statement of John B Sanfilippo&Son, it seems that company is thinking out the frontier risks that can impact Food Processing industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High bargaining power of channel partners in Food Processing industry
– because of the regulatory requirements in United States, John B Sanfilippo&Son 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 Food Processing industry.
John B Sanfilippo&Son Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of John B Sanfilippo&Son are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Food Processing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. John B Sanfilippo&Son 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. John B Sanfilippo&Son 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.
Developing new processes and practices
– John B Sanfilippo&Son can develop new processes and procedures in Food Processing 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.
Using analytics as competitive advantage
– John B Sanfilippo&Son has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Food Processing sector. This continuous investment in analytics has enabled John B Sanfilippo&Son to build a competitive advantage using analytics. The analytics driven competitive advantage can help John B Sanfilippo&Son to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– John B Sanfilippo&Son 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, John B Sanfilippo&Son is facing challenges because of the dominance of functional experts in the organization. John B Sanfilippo&Son can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, 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, John B Sanfilippo&Son can use these opportunities to build new business models that can help the communities that John B Sanfilippo&Son operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Buying journey improvements
– John B Sanfilippo&Son can improve the customer journey of consumers in the Food Processing 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects John B Sanfilippo&Son can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, John B Sanfilippo&Son 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 John B Sanfilippo&Son 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. John B Sanfilippo&Son can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at John B Sanfilippo&Son 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 Food Processing industry.
Better consumer reach
– The expansion of the 5G network will help John B Sanfilippo&Son to increase its market reach. John B Sanfilippo&Son 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. John B Sanfilippo&Son can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats John B Sanfilippo&Son External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of John B Sanfilippo&Son are -
Technology acceleration in Forth Industrial Revolution
– John B Sanfilippo&Son has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, John B Sanfilippo&Son needs to keep up with the evolution of technology in the Food Processing 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, John B Sanfilippo&Son 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 John B Sanfilippo&Son prominent markets.
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.
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 John B Sanfilippo&Son business can come under increasing regulations regarding data privacy, data security, etc.
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 John B Sanfilippo&Son.
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. John B Sanfilippo&Son needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
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 John B Sanfilippo&Son in the Food Processing 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.
High dependence on third party suppliers
– John B Sanfilippo&Son 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.
Stagnating economy with rate increase
– John B Sanfilippo&Son 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 Food Processing industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Food Processing industry are lowering. It can presents John B Sanfilippo&Son with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Food Processing sector.
Regulatory challenges
– John B Sanfilippo&Son 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 Food Processing industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for John B Sanfilippo&Son in Food Processing industry. The Food Processing 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.
Weighted SWOT Analysis of John B Sanfilippo&Son Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at John B Sanfilippo&Son 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 John B Sanfilippo&Son 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 John B Sanfilippo&Son 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 John B Sanfilippo&Son 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 John B Sanfilippo&Son needs to make to build a sustainable competitive advantage.