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NutriSystem (NTRI) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for NutriSystem (United States)


Based on various researches at Oak Spring University , NutriSystem is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, wage bills are increasing, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, etc



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Introduction to SWOT Analysis of NutriSystem


SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that NutriSystem can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the NutriSystem, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which NutriSystem 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 NutriSystem can be done for the following purposes –
1. Strategic planning of NutriSystem
2. Improving business portfolio management of NutriSystem
3. Assessing feasibility of the new initiative in United States
4. Making a Personal Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of NutriSystem




Strengths of NutriSystem | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of NutriSystem are -

Organizational Resilience of NutriSystem

– The covid-19 pandemic has put organizational resilience at the centre of everthing NutriSystem does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Innovation driven organization

– NutriSystem is one of the most innovative firm in Personal Services sector.

Digital Transformation in Personal Services industry

- digital transformation varies from industry to industry. For NutriSystem digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. NutriSystem 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.

Analytics focus

– NutriSystem 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 Personal Services 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.

Training and development

– NutriSystem has one of the best training and development program in Services 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.

Operational resilience

– The operational resilience strategy of NutriSystem comprises – understanding the underlying the factors in the Personal Services 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.

Ability to recruit top talent

– NutriSystem is one of the leading players in the Personal Services 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.

Diverse revenue streams

– NutriSystem is present in almost all the verticals within the Personal Services industry. This has provided NutriSystem a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.

High brand equity

– NutriSystem has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled NutriSystem to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Low bargaining power of suppliers

– Suppliers of NutriSystem in the Services sector have low bargaining power. NutriSystem has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps NutriSystem to manage not only supply disruptions but also source products at highly competitive prices.

Strong track record of project management in the Personal Services industry

– NutriSystem 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

– NutriSystem has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Personal Services industry. Secondly the value chain collaborators of NutriSystem have helped the firm to develop new products and bring them quickly to the marketplace.






Weaknesses of NutriSystem | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of NutriSystem are -

High cash cycle compare to competitors

NutriSystem has a high cash cycle compare to other players in the Personal Services 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 NutriSystem strategy

– From the outside it seems that the employees of NutriSystem 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.

Products dominated business model

– Even though NutriSystem has some of the most successful models in the Personal Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. NutriSystem 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, NutriSystem needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

High operating costs

– Compare to the competitors, NutriSystem has high operating costs in the Personal Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract NutriSystem lucrative customers.

Aligning sales with marketing

– From the outside it seems that NutriSystem needs to have more collaboration between its sales team and marketing team. Sales professionals in the Personal Services industry have deep experience in developing customer relationships. Marketing department at NutriSystem can leverage the sales team experience to cultivate customer relationships as NutriSystem is planning to shift buying processes online.

Workers concerns about automation

– As automation is fast increasing in the Personal Services industry, NutriSystem needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.

Compensation and incentives

– The revenue per employee of NutriSystem is just above the Personal Services industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.

High dependence on NutriSystem ‘s star products

– The top 2 products and services of NutriSystem still accounts for major business revenue. This dependence on star products in Personal Services industry has resulted into insufficient focus on developing new products, even though NutriSystem has relatively successful track record of launching new products.

Interest costs

– Compare to the competition, NutriSystem 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.

Ability to respond to the competition

– As the decision making is very deliberative at NutriSystem, in the dynamic environment of Personal Services industry it has struggled to respond to the nimble upstart competition. NutriSystem has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.




NutriSystem Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The opportunities of NutriSystem are -

Loyalty marketing

– NutriSystem 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.

Better consumer reach

– The expansion of the 5G network will help NutriSystem to increase its market reach. NutriSystem 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.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects NutriSystem can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, NutriSystem can use these opportunities to build new business models that can help the communities that NutriSystem operates in. Secondly it can use opportunities from government spending in Personal Services sector.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Personal Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. NutriSystem 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. NutriSystem 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.

Use of Bitcoin and other crypto currencies for transactions in Personal Services industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for NutriSystem in the Personal Services industry. Now NutriSystem can target international markets with far fewer capital restrictions requirements than the existing system.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, NutriSystem 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 NutriSystem to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Personal Services industry, but it has also influenced the consumer preferences. NutriSystem can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Creating value in data economy

– The success of analytics program of NutriSystem has opened avenues for new revenue streams for the organization in Personal Services industry. This can help NutriSystem to build a more holistic ecosystem for NutriSystem products in the Personal Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Redefining models of collaboration and team work

– As explained in the weaknesses section, NutriSystem is facing challenges because of the dominance of functional experts in the organization. NutriSystem can utilize new technology in the field of Personal Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Leveraging digital technologies

– NutriSystem 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.

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 NutriSystem 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.

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. NutriSystem can explore opportunities that can attract volunteers and are consistent with its mission and vision.




Threats NutriSystem External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The threats of NutriSystem are -

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Personal Services industry are lowering. It can presents NutriSystem with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Personal Services sector.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, NutriSystem 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 NutriSystem prominent markets.

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 NutriSystem.

Technology acceleration in Forth Industrial Revolution

– NutriSystem has witnessed rapid integration of technology during Covid-19 in the Personal Services industry. As one of the leading players in the industry, NutriSystem needs to keep up with the evolution of technology in the Personal Services 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 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. NutriSystem needs to understand the core reasons impacting the Personal Services industry. This will help it in building a better workplace.

Easy access to finance

– Easy access to finance in Personal Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. NutriSystem 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 NutriSystem

– 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 NutriSystem.

Consumer confidence and its impact on NutriSystem 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 Personal Services industry and other sectors.

Shortening product life cycle

– it is one of the major threat that NutriSystem is facing in Personal Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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.

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.

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. NutriSystem 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, NutriSystem may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Personal Services sector.




Weighted SWOT Analysis of NutriSystem Template, Example


Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at NutriSystem 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 NutriSystem 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 NutriSystem 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 NutriSystem 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 NutriSystem needs to make to build a sustainable competitive advantage.



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