SWOT Analysis / TOWS Matrix for Sturm Ruger&Company (United States)
Based on various researches at Oak Spring University , Sturm Ruger&Company is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, geopolitical disruptions, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies,
there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Sturm Ruger&Company
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sturm Ruger&Company can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sturm Ruger&Company, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sturm Ruger&Company 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 Sturm Ruger&Company can be done for the following purposes –
1. Strategic planning of Sturm Ruger&Company
2. Improving business portfolio management of Sturm Ruger&Company
3. Assessing feasibility of the new initiative in United States
4. Making a Recreational Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sturm Ruger&Company
Strengths of Sturm Ruger&Company | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sturm Ruger&Company are -
Analytics focus
– Sturm Ruger&Company 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 Recreational Products 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.
Successful track record of launching new products
– Sturm Ruger&Company has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sturm Ruger&Company 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.
High brand equity
– Sturm Ruger&Company has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sturm Ruger&Company to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Sturm Ruger&Company in Recreational Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Sturm Ruger&Company in the Consumer Cyclical sector have low bargaining power. Sturm Ruger&Company has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sturm Ruger&Company to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Sturm Ruger&Company
– The covid-19 pandemic has put organizational resilience at the centre of everthing Sturm Ruger&Company does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Sturm Ruger&Company is one of the leading players in the Recreational Products 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.
Highly skilled collaborators
– Sturm Ruger&Company has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Recreational Products industry. Secondly the value chain collaborators of Sturm Ruger&Company have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Sturm Ruger&Company is one of the most innovative firm in Recreational Products sector.
Operational resilience
– The operational resilience strategy of Sturm Ruger&Company comprises – understanding the underlying the factors in the Recreational Products 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 lead change in Recreational Products
– Sturm Ruger&Company is one of the leading players in the Recreational Products industry in United States. Over the years it has not only transformed the business landscape in the Recreational Products industry in United States but also across the existing markets. The ability to lead change has enabled Sturm Ruger&Company in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Sturm Ruger&Company has one of the best training and development program in Consumer 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.
Weaknesses of Sturm Ruger&Company | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sturm Ruger&Company are -
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 Sturm Ruger&Company supply chain. Even after few cautionary changes, Sturm Ruger&Company is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sturm Ruger&Company vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– From the outside it seems that Sturm Ruger&Company needs to have more collaboration between its sales team and marketing team. Sales professionals in the Recreational Products industry have deep experience in developing customer relationships. Marketing department at Sturm Ruger&Company can leverage the sales team experience to cultivate customer relationships as Sturm Ruger&Company is planning to shift buying processes online.
Lack of clear differentiation of Sturm Ruger&Company products
– To increase the profitability and margins on the products, Sturm Ruger&Company needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Sturm Ruger&Company has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Slow to strategic competitive environment developments
– As Sturm Ruger&Company is one of the leading players in the Recreational Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Recreational Products industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sturm Ruger&Company is slow explore the new channels of communication. These new channels of communication can help Sturm Ruger&Company to provide better information regarding Recreational Products products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Sturm Ruger&Company has a high cash cycle compare to other players in the Recreational Products industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of United States, Sturm Ruger&Company needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Sturm Ruger&Company has some of the most successful models in the Recreational Products industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Sturm Ruger&Company should strive to include more intangible value offerings along with its core products and services.
Employees’ less understanding of Sturm Ruger&Company strategy
– From the outside it seems that the employees of Sturm Ruger&Company 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.
High operating costs
– Compare to the competitors, Sturm Ruger&Company has high operating costs in the Recreational Products industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Sturm Ruger&Company lucrative customers.
Sturm Ruger&Company Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sturm Ruger&Company are -
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. Sturm Ruger&Company can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sturm Ruger&Company in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Recreational Products industry, and it will provide faster access to the consumers.
Developing new processes and practices
– Sturm Ruger&Company can develop new processes and procedures in Recreational Products 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, Sturm Ruger&Company is facing challenges because of the dominance of functional experts in the organization. Sturm Ruger&Company can utilize new technology in the field of Recreational Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Sturm Ruger&Company 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 Recreational Products industry.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Recreational Products industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Sturm Ruger&Company 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. Sturm Ruger&Company 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.
Manufacturing automation
– Sturm Ruger&Company can use the latest technology developments to improve its manufacturing and designing process in Recreational Products 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.
Better consumer reach
– The expansion of the 5G network will help Sturm Ruger&Company to increase its market reach. Sturm Ruger&Company 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.
Use of Bitcoin and other crypto currencies for transactions in Recreational Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Sturm Ruger&Company in the Recreational Products industry. Now Sturm Ruger&Company can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Sturm Ruger&Company has opened avenues for new revenue streams for the organization in Recreational Products industry. This can help Sturm Ruger&Company to build a more holistic ecosystem for Sturm Ruger&Company products in the Recreational Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Sturm Ruger&Company has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Recreational Products sector. This continuous investment in analytics has enabled Sturm Ruger&Company to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sturm Ruger&Company to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sturm Ruger&Company 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 Sturm Ruger&Company to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sturm Ruger&Company 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 Sturm Ruger&Company to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Sturm Ruger&Company External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sturm Ruger&Company are -
Consumer confidence and its impact on Sturm Ruger&Company 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 Recreational Products industry and other sectors.
Increasing wage structure of Sturm Ruger&Company
– 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 Sturm Ruger&Company.
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. Sturm Ruger&Company needs to understand the core reasons impacting the Recreational Products industry. This will help it in building a better workplace.
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 Sturm Ruger&Company.
Easy access to finance
– Easy access to finance in Recreational Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Sturm Ruger&Company 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 Sturm Ruger&Company business can come under increasing regulations regarding data privacy, data security, etc.
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 Sturm Ruger&Company in the Recreational Products sector and impact the bottomline of the organization.
Regulatory challenges
– Sturm Ruger&Company 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 Recreational Products industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sturm Ruger&Company 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 Sturm Ruger&Company prominent markets.
Shortening product life cycle
– it is one of the major threat that Sturm Ruger&Company is facing in Recreational Products 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, Sturm Ruger&Company may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Recreational Products sector.
Stagnating economy with rate increase
– Sturm Ruger&Company 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 Recreational Products industry.
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.
Weighted SWOT Analysis of Sturm Ruger&Company Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sturm Ruger&Company 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 Sturm Ruger&Company 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 Sturm Ruger&Company 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 Sturm Ruger&Company 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 Sturm Ruger&Company needs to make to build a sustainable competitive advantage.