Big Rock Brewery Inc. (BR) SWOT Analysis / TOWS Matrix / MBA Resources
Beverages (Alcoholic)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Big Rock Brewery Inc. (Canada)
Based on various researches at Oak Spring University , Big Rock Brewery Inc. is operating in a macro-environment that has been destablized by – increasing energy prices, there is backlash against globalization, there is increasing trade war between United States & China, technology disruption, 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%,
digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Big Rock Brewery Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Big Rock Brewery Inc. can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Big Rock Brewery Inc., and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Big Rock Brewery Inc. 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 Big Rock Brewery Inc. can be done for the following purposes –
1. Strategic planning of Big Rock Brewery Inc.
2. Improving business portfolio management of Big Rock Brewery Inc.
3. Assessing feasibility of the new initiative in Canada
4. Making a Beverages (Alcoholic) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Big Rock Brewery Inc.
Strengths of Big Rock Brewery Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Big Rock Brewery Inc. are -
Low bargaining power of suppliers
– Suppliers of Big Rock Brewery Inc. in the Consumer/Non-Cyclical sector have low bargaining power. Big Rock Brewery Inc. has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Big Rock Brewery Inc. to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy of Big Rock Brewery Inc. comprises – understanding the underlying the factors in the Beverages (Alcoholic) 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
– Big Rock Brewery Inc. is one of the leading players in the Beverages (Alcoholic) industry in Canada. It is in a position to attract the best talent available in Canada. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Big Rock Brewery Inc. has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Beverages (Alcoholic) industry. Secondly the value chain collaborators of Big Rock Brewery Inc. have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Big Rock Brewery Inc. is present in almost all the verticals within the Beverages (Alcoholic) industry. This has provided Big Rock Brewery Inc. 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.
Training and development
– Big Rock Brewery Inc. 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.
Strong track record of project management in the Beverages (Alcoholic) industry
– Big Rock Brewery Inc. is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Big Rock Brewery Inc. is one of the most innovative firm in Beverages (Alcoholic) sector.
High brand equity
– Big Rock Brewery Inc. has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Big Rock Brewery Inc. to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Beverages (Alcoholic) industry
- digital transformation varies from industry to industry. For Big Rock Brewery Inc. digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Big Rock Brewery Inc. 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.
Superior customer experience
– The customer experience strategy of Big Rock Brewery Inc. in Beverages (Alcoholic) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Big Rock Brewery Inc. has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Big Rock Brewery Inc. 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.
Weaknesses of Big Rock Brewery Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Big Rock Brewery Inc. are -
Capital Spending Reduction
– Even during the low interest decade, Big Rock Brewery Inc. 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 Beverages (Alcoholic) industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative at Big Rock Brewery Inc., in the dynamic environment of Beverages (Alcoholic) industry it has struggled to respond to the nimble upstart competition. Big Rock Brewery Inc. has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Big Rock Brewery Inc. has a high cash cycle compare to other players in the Beverages (Alcoholic) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Compensation and incentives
– The revenue per employee of Big Rock Brewery Inc. is just above the Beverages (Alcoholic) 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.
Slow decision making process
– As mentioned earlier in the report, Big Rock Brewery Inc. has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Beverages (Alcoholic) industry over the last five years. Big Rock Brewery Inc. 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.
Interest costs
– Compare to the competition, Big Rock Brewery Inc. 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.
Low market penetration in new markets
– Outside its home market of Canada, Big Rock Brewery Inc. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– From the 10K / annual statement of Big Rock Brewery Inc., it seems that company is thinking out the frontier risks that can impact Beverages (Alcoholic) 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 Big Rock Brewery Inc. is dominated by functional specialists. It is not different from other players in the Beverages (Alcoholic) industry, but Big Rock Brewery Inc. needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Big Rock Brewery Inc. to focus more on services in the Beverages (Alcoholic) industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Big Rock Brewery Inc. is one of the leading players in the Beverages (Alcoholic) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Beverages (Alcoholic) industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Beverages (Alcoholic) industry, Big Rock Brewery Inc. 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.
Big Rock Brewery Inc. Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Big Rock Brewery Inc. are -
Buying journey improvements
– Big Rock Brewery Inc. can improve the customer journey of consumers in the Beverages (Alcoholic) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Big Rock Brewery Inc. 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.
Better consumer reach
– The expansion of the 5G network will help Big Rock Brewery Inc. to increase its market reach. Big Rock Brewery Inc. 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Big Rock Brewery Inc. 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 Big Rock Brewery Inc. to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Big Rock Brewery Inc. has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Beverages (Alcoholic) sector. This continuous investment in analytics has enabled Big Rock Brewery Inc. to build a competitive advantage using analytics. The analytics driven competitive advantage can help Big Rock Brewery Inc. to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Big Rock Brewery Inc. can develop new processes and procedures in Beverages (Alcoholic) 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Big Rock Brewery Inc. is facing challenges because of the dominance of functional experts in the organization. Big Rock Brewery Inc. can utilize new technology in the field of Beverages (Alcoholic) 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 Beverages (Alcoholic) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Big Rock Brewery Inc. in the Beverages (Alcoholic) industry. Now Big Rock Brewery Inc. can target international markets with far fewer capital restrictions requirements than the existing system.
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 Big Rock Brewery Inc. 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Big Rock Brewery Inc. can use these opportunities to build new business models that can help the communities that Big Rock Brewery Inc. operates in. Secondly it can use opportunities from government spending in Beverages (Alcoholic) sector.
Learning at scale
– Online learning technologies has now opened space for Big Rock Brewery Inc. to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Big Rock Brewery Inc. 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 Big Rock Brewery Inc. to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Big Rock Brewery Inc. in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Beverages (Alcoholic) industry, and it will provide faster access to the consumers.
Threats Big Rock Brewery Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Big Rock Brewery Inc. are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Beverages (Alcoholic) industry are lowering. It can presents Big Rock Brewery Inc. with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Beverages (Alcoholic) sector.
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. Big Rock Brewery Inc. needs to understand the core reasons impacting the Beverages (Alcoholic) industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Big Rock Brewery Inc. in Beverages (Alcoholic) industry. The Beverages (Alcoholic) 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.
Easy access to finance
– Easy access to finance in Beverages (Alcoholic) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Big Rock Brewery Inc. can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Big Rock Brewery Inc. business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Big Rock Brewery Inc. 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 Beverages (Alcoholic) industry regulations.
Stagnating economy with rate increase
– Big Rock Brewery Inc. 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 Beverages (Alcoholic) industry.
Shortening product life cycle
– it is one of the major threat that Big Rock Brewery Inc. is facing in Beverages (Alcoholic) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Big Rock Brewery Inc. may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Beverages (Alcoholic) sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Big Rock Brewery Inc. 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 Big Rock Brewery Inc. prominent markets.
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. Big Rock Brewery Inc. 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.
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.
Increasing wage structure of Big Rock Brewery Inc.
– 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 Big Rock Brewery Inc..
Weighted SWOT Analysis of Big Rock Brewery Inc. Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Big Rock Brewery Inc. 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 Big Rock Brewery Inc. 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 Big Rock Brewery Inc. 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 Big Rock Brewery Inc. 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 Big Rock Brewery Inc. needs to make to build a sustainable competitive advantage.
