Based on various researches at Oak Spring University , Siteone Landscape Supply is operating in a macro-environment that has been destablized by – geopolitical disruptions, cloud computing is disrupting traditional business models, technology disruption, there is increasing trade war between United States & China, increasing commodity prices, increasing government debt because of Covid-19 spendings, increasing energy prices,
supply chains are disrupted by pandemic , increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Siteone Landscape Supply
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Siteone Landscape Supply can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Siteone Landscape Supply, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Siteone Landscape Supply 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 Siteone Landscape Supply can be done for the following purposes –
1. Strategic planning of Siteone Landscape Supply
2. Improving business portfolio management of Siteone Landscape Supply
3. Assessing feasibility of the new initiative in United States
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Siteone Landscape Supply
Strengths of Siteone Landscape Supply | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Siteone Landscape Supply are -
Low bargaining power of suppliers
– Suppliers of Siteone Landscape Supply in the Consumer/Non-Cyclical sector have low bargaining power. Siteone Landscape Supply has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Siteone Landscape Supply to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Siteone Landscape Supply 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 Siteone Landscape Supply is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Siteone Landscape Supply emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Siteone Landscape Supply is present in almost all the verticals within the Crops industry. This has provided Siteone Landscape Supply 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.
Innovation driven organization
– Siteone Landscape Supply is one of the most innovative firm in Crops sector.
Ability to lead change in Crops
– Siteone Landscape Supply is one of the leading players in the Crops industry in United States. Over the years it has not only transformed the business landscape in the Crops industry in United States but also across the existing markets. The ability to lead change has enabled Siteone Landscape Supply in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Siteone Landscape Supply is one of the leading players in the Crops 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.
Organizational Resilience of Siteone Landscape Supply
– The covid-19 pandemic has put organizational resilience at the centre of everthing Siteone Landscape Supply does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of Siteone Landscape Supply comprises – understanding the underlying the factors in the Crops 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.
High brand equity
– Siteone Landscape Supply has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Siteone Landscape Supply to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Crops industry
– Siteone Landscape Supply has clearly differentiated products in the market place. This has enabled Siteone Landscape Supply to fetch slight price premium compare to the competitors in the Crops industry. The sustainable margins have also helped Siteone Landscape Supply to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Siteone Landscape Supply in Crops industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Siteone Landscape Supply 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.
Weaknesses of Siteone Landscape Supply | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Siteone Landscape Supply are -
Need for greater diversity
– Siteone Landscape Supply 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.
Interest costs
– Compare to the competition, Siteone Landscape Supply 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.
Employees’ less understanding of Siteone Landscape Supply strategy
– From the outside it seems that the employees of Siteone Landscape Supply 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.
Ability to respond to the competition
– As the decision making is very deliberative at Siteone Landscape Supply, in the dynamic environment of Crops industry it has struggled to respond to the nimble upstart competition. Siteone Landscape Supply has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring in Crops industry
– The stress on hiring functional specialists at Siteone Landscape Supply 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.
Slow decision making process
– As mentioned earlier in the report, Siteone Landscape Supply has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Crops industry over the last five years. Siteone Landscape Supply 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.
Increasing silos among functional specialists
– The organizational structure of Siteone Landscape Supply is dominated by functional specialists. It is not different from other players in the Crops industry, but Siteone Landscape Supply needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Siteone Landscape Supply to focus more on services in the Crops industry rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee of Siteone Landscape Supply is just above the Crops 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 cash cycle compare to competitors
Siteone Landscape Supply has a high cash cycle compare to other players in the Crops industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of Siteone Landscape Supply products
– To increase the profitability and margins on the products, Siteone Landscape Supply needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Siteone Landscape Supply is slow explore the new channels of communication. These new channels of communication can help Siteone Landscape Supply to provide better information regarding Crops products and services. It can also build an online community to further reach out to potential customers.
Siteone Landscape Supply Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Siteone Landscape Supply are -
Use of Bitcoin and other crypto currencies for transactions in Crops industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Siteone Landscape Supply in the Crops industry. Now Siteone Landscape Supply can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Siteone Landscape Supply 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Siteone Landscape Supply 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.
Buying journey improvements
– Siteone Landscape Supply can improve the customer journey of consumers in the Crops 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Crops industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Siteone Landscape Supply 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. Siteone Landscape Supply 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Siteone Landscape Supply 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 Siteone Landscape Supply to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Siteone Landscape Supply can use the latest technology developments to improve its manufacturing and designing process in Crops 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Crops industry, but it has also influenced the consumer preferences. Siteone Landscape Supply 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 Siteone Landscape Supply has opened avenues for new revenue streams for the organization in Crops industry. This can help Siteone Landscape Supply to build a more holistic ecosystem for Siteone Landscape Supply products in the Crops industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Siteone Landscape Supply 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 Crops industry.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Siteone Landscape Supply is facing challenges because of the dominance of functional experts in the organization. Siteone Landscape Supply can utilize new technology in the field of Crops industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Siteone Landscape Supply can develop new processes and procedures in Crops 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Siteone Landscape Supply in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Crops industry, and it will provide faster access to the consumers.
Threats Siteone Landscape Supply External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Siteone Landscape Supply are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Siteone Landscape Supply may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops 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 Siteone Landscape Supply business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Siteone Landscape Supply in Crops industry. The Crops 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.
Environmental challenges
– Siteone Landscape Supply 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. Siteone Landscape Supply can take advantage of this fund but it will also bring new competitors in the Crops industry.
Consumer confidence and its impact on Siteone Landscape Supply 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 Crops industry and other sectors.
Shortening product life cycle
– it is one of the major threat that Siteone Landscape Supply is facing in Crops sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Siteone Landscape Supply
– 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 Siteone Landscape Supply.
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. Siteone Landscape Supply 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.
Easy access to finance
– Easy access to finance in Crops industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Siteone Landscape Supply can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Siteone Landscape Supply 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 Siteone Landscape Supply prominent markets.
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.
Stagnating economy with rate increase
– Siteone Landscape Supply 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 Crops industry.
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.
Weighted SWOT Analysis of Siteone Landscape Supply Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Siteone Landscape Supply 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 Siteone Landscape Supply 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 Siteone Landscape Supply 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 Siteone Landscape Supply 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 Siteone Landscape Supply needs to make to build a sustainable competitive advantage.