SWOT Analysis / TOWS Matrix for Pingtan Marine (United States)
Based on various researches at Oak Spring University , Pingtan Marine is operating in a macro-environment that has been destablized by – wage bills are increasing, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies,
there is increasing trade war between United States & China, central banks are concerned over increasing inflation, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Pingtan Marine can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pingtan Marine, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pingtan Marine 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 Pingtan Marine can be done for the following purposes –
1. Strategic planning of Pingtan Marine
2. Improving business portfolio management of Pingtan Marine
3. Assessing feasibility of the new initiative in United States
4. Making a Fish/Livestock sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Pingtan Marine
Strengths of Pingtan Marine | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pingtan Marine are -
High switching costs
– The high switching costs that Pingtan Marine 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.
Cross disciplinary teams
– Horizontal connected teams at the Pingtan Marine 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 Pingtan Marine in the Consumer/Non-Cyclical sector have low bargaining power. Pingtan Marine has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pingtan Marine to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Pingtan Marine in Fish/Livestock industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Pingtan Marine has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Fish/Livestock industry. Secondly the value chain collaborators of Pingtan Marine have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Fish/Livestock industry
– Pingtan Marine has clearly differentiated products in the market place. This has enabled Pingtan Marine to fetch slight price premium compare to the competitors in the Fish/Livestock industry. The sustainable margins have also helped Pingtan Marine to invest into research and development (R&D) and innovation.
Digital Transformation in Fish/Livestock industry
- digital transformation varies from industry to industry. For Pingtan Marine digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Pingtan Marine 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.
Successful track record of launching new products
– Pingtan Marine has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pingtan Marine 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
– Pingtan Marine is present in almost all the verticals within the Fish/Livestock industry. This has provided Pingtan Marine 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.
Organizational Resilience of Pingtan Marine
– The covid-19 pandemic has put organizational resilience at the centre of everthing Pingtan Marine does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Pingtan Marine has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Pingtan Marine to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Pingtan Marine has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Pingtan Marine staying ahead in the Fish/Livestock industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Pingtan Marine | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Pingtan Marine are -
Products dominated business model
– Even though Pingtan Marine has some of the most successful models in the Fish/Livestock industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Pingtan Marine should strive to include more intangible value offerings along with its core products and services.
Skills based hiring in Fish/Livestock industry
– The stress on hiring functional specialists at Pingtan Marine 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.
High operating costs
– Compare to the competitors, Pingtan Marine has high operating costs in the Fish/Livestock industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Pingtan Marine lucrative customers.
High bargaining power of channel partners in Fish/Livestock industry
– because of the regulatory requirements in United States, Pingtan Marine 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 Fish/Livestock industry.
No frontier risks strategy
– From the 10K / annual statement of Pingtan Marine, it seems that company is thinking out the frontier risks that can impact Fish/Livestock 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.
Increasing silos among functional specialists
– The organizational structure of Pingtan Marine is dominated by functional specialists. It is not different from other players in the Fish/Livestock industry, but Pingtan Marine needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Pingtan Marine to focus more on services in the Fish/Livestock industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of United States, Pingtan Marine needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Pingtan Marine has a high cash cycle compare to other players in the Fish/Livestock industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Pingtan Marine is slow explore the new channels of communication. These new channels of communication can help Pingtan Marine to provide better information regarding Fish/Livestock 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 Pingtan Marine, in the dynamic environment of Fish/Livestock industry it has struggled to respond to the nimble upstart competition. Pingtan Marine has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the Fish/Livestock industry, Pingtan Marine 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.
Pingtan Marine Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Pingtan Marine are -
Better consumer reach
– The expansion of the 5G network will help Pingtan Marine to increase its market reach. Pingtan Marine 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.
Manufacturing automation
– Pingtan Marine can use the latest technology developments to improve its manufacturing and designing process in Fish/Livestock 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.
Developing new processes and practices
– Pingtan Marine can develop new processes and procedures in Fish/Livestock 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.
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. Pingtan Marine can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Pingtan Marine can improve the customer journey of consumers in the Fish/Livestock 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Pingtan Marine in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Fish/Livestock industry, and it will provide faster access to the consumers.
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 Pingtan Marine 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Fish/Livestock industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Pingtan Marine 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. Pingtan Marine 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.
Leveraging digital technologies
– Pingtan Marine 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Pingtan Marine can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Pingtan Marine 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Pingtan Marine 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 Pingtan Marine to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Pingtan Marine 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 Pingtan Marine to hire the very best people irrespective of their geographical location.
Threats Pingtan Marine External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Pingtan Marine are -
Consumer confidence and its impact on Pingtan Marine 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 Fish/Livestock 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 Pingtan Marine.
High dependence on third party suppliers
– Pingtan Marine 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Pingtan Marine may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Fish/Livestock sector.
Environmental challenges
– Pingtan Marine 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. Pingtan Marine can take advantage of this fund but it will also bring new competitors in the Fish/Livestock industry.
Technology acceleration in Forth Industrial Revolution
– Pingtan Marine has witnessed rapid integration of technology during Covid-19 in the Fish/Livestock industry. As one of the leading players in the industry, Pingtan Marine needs to keep up with the evolution of technology in the Fish/Livestock 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.
Regulatory challenges
– Pingtan Marine 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 Fish/Livestock industry regulations.
Increasing wage structure of Pingtan Marine
– 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 Pingtan Marine.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Pingtan Marine 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 Pingtan Marine 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.
Stagnating economy with rate increase
– Pingtan Marine 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 Fish/Livestock industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Fish/Livestock industry are lowering. It can presents Pingtan Marine with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Fish/Livestock sector.
Weighted SWOT Analysis of Pingtan Marine Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Pingtan Marine 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 Pingtan Marine 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 Pingtan Marine 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 Pingtan Marine 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 Pingtan Marine needs to make to build a sustainable competitive advantage.