Marfrig Global Foods SA (MRRTY) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Marfrig Global Foods SA (United States)
Based on various researches at Oak Spring University , Marfrig Global Foods SA is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, wage bills are increasing, supply chains are disrupted by pandemic , increasing commodity prices, geopolitical disruptions, increasing energy prices, increasing transportation and logistics costs,
increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Marfrig Global Foods SA
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Marfrig Global Foods SA can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Marfrig Global Foods SA, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Marfrig Global Foods SA 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 Marfrig Global Foods SA can be done for the following purposes –
1. Strategic planning of Marfrig Global Foods SA
2. Improving business portfolio management of Marfrig Global Foods SA
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Marfrig Global Foods SA
Strengths of Marfrig Global Foods SA | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Marfrig Global Foods SA are -
Ability to recruit top talent
– Marfrig Global Foods SA is one of the leading players in the industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Marfrig Global Foods SA 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 Marfrig Global Foods SA is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Marfrig Global Foods SA emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Marfrig Global Foods SA has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Marfrig Global Foods SA staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in industry
- digital transformation varies from industry to industry. For Marfrig Global Foods SA digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Marfrig Global Foods SA 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.
High brand equity
– Marfrig Global Foods SA has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Marfrig Global Foods SA to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Marfrig Global Foods SA in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of Marfrig Global Foods SA comprises – understanding the underlying the factors in the 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.
Sustainable margins compare to other players in industry
– Marfrig Global Foods SA has clearly differentiated products in the market place. This has enabled Marfrig Global Foods SA to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Marfrig Global Foods SA to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Marfrig Global Foods SA in the sector have low bargaining power. Marfrig Global Foods SA has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Marfrig Global Foods SA to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in
– Marfrig Global Foods SA is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled Marfrig Global Foods SA 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 Marfrig Global Foods SA 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.
Innovation driven organization
– Marfrig Global Foods SA is one of the most innovative firm in sector.
Weaknesses of Marfrig Global Foods SA | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Marfrig Global Foods SA are -
Capital Spending Reduction
– Even during the low interest decade, Marfrig Global Foods SA 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 industry using digital technology.
Lack of clear differentiation of Marfrig Global Foods SA products
– To increase the profitability and margins on the products, Marfrig Global Foods SA needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, Marfrig Global Foods SA has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Marfrig Global Foods SA lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Marfrig Global Foods SA has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Marfrig Global Foods SA 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.
High bargaining power of channel partners in industry
– because of the regulatory requirements in United States, Marfrig Global Foods SA 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 industry.
Aligning sales with marketing
– From the outside it seems that Marfrig Global Foods SA needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department at Marfrig Global Foods SA can leverage the sales team experience to cultivate customer relationships as Marfrig Global Foods SA is planning to shift buying processes online.
Interest costs
– Compare to the competition, Marfrig Global Foods SA 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
Marfrig Global Foods SA has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
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 Marfrig Global Foods SA supply chain. Even after few cautionary changes, Marfrig Global Foods SA is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Marfrig Global Foods SA 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, Marfrig Global Foods SA is slow explore the new channels of communication. These new channels of communication can help Marfrig Global Foods SA to provide better information regarding 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 Marfrig Global Foods SA, in the dynamic environment of industry it has struggled to respond to the nimble upstart competition. Marfrig Global Foods SA has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Marfrig Global Foods SA Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Marfrig Global Foods SA are -
Loyalty marketing
– Marfrig Global Foods SA 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 Marfrig Global Foods SA can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Marfrig Global Foods SA is facing challenges because of the dominance of functional experts in the organization. Marfrig Global Foods SA can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Marfrig Global Foods SA in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Marfrig Global Foods SA 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 industry.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Marfrig Global Foods SA 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 Marfrig Global Foods SA to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Marfrig Global Foods SA can improve the customer journey of consumers in the 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 Marfrig Global Foods SA to increase its market reach. Marfrig Global Foods SA 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.
Using analytics as competitive advantage
– Marfrig Global Foods SA has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Marfrig Global Foods SA to build a competitive advantage using analytics. The analytics driven competitive advantage can help Marfrig Global Foods SA to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Marfrig Global Foods SA can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Marfrig Global Foods SA can use these opportunities to build new business models that can help the communities that Marfrig Global Foods SA operates in. Secondly it can use opportunities from government spending in sector.
Creating value in data economy
– The success of analytics program of Marfrig Global Foods SA has opened avenues for new revenue streams for the organization in industry. This can help Marfrig Global Foods SA to build a more holistic ecosystem for Marfrig Global Foods SA products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Marfrig Global Foods SA can use the latest technology developments to improve its manufacturing and designing process in 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.
Threats Marfrig Global Foods SA External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Marfrig Global Foods SA are -
Regulatory challenges
– Marfrig Global Foods SA 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 industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Marfrig Global Foods SA with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Environmental challenges
– Marfrig Global Foods SA 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. Marfrig Global Foods SA can take advantage of this fund but it will also bring new competitors in the industry.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Marfrig Global Foods SA can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Marfrig Global Foods SA
– 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 Marfrig Global Foods SA.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Marfrig Global Foods SA in industry. The 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.
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. Marfrig Global Foods SA needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Marfrig Global Foods SA 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 Marfrig Global Foods SA prominent markets.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Marfrig Global Foods SA may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of sector.
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 Marfrig Global Foods SA business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Marfrig Global Foods SA has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Marfrig Global Foods SA needs to keep up with the evolution of technology in the 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.
High dependence on third party suppliers
– Marfrig Global Foods SA 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.
Weighted SWOT Analysis of Marfrig Global Foods SA Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Marfrig Global Foods SA 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 Marfrig Global Foods SA 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 Marfrig Global Foods SA 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 Marfrig Global Foods SA 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 Marfrig Global Foods SA needs to make to build a sustainable competitive advantage.