SWOT Analysis / TOWS Matrix for Shenyang Toly Bread (China)
Based on various researches at Oak Spring University , Shenyang Toly Bread is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, technology disruption, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google,
customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, etc
Introduction to SWOT Analysis of Shenyang Toly Bread
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shenyang Toly Bread can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shenyang Toly Bread, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shenyang Toly Bread 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 Shenyang Toly Bread can be done for the following purposes –
1. Strategic planning of Shenyang Toly Bread
2. Improving business portfolio management of Shenyang Toly Bread
3. Assessing feasibility of the new initiative in China
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shenyang Toly Bread
Strengths of Shenyang Toly Bread | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shenyang Toly Bread are -
Low bargaining power of suppliers
– Suppliers of Shenyang Toly Bread in the Consumer/Non-Cyclical sector have low bargaining power. Shenyang Toly Bread has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shenyang Toly Bread to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Food Processing
– Shenyang Toly Bread is one of the leading players in the Food Processing industry in China. Over the years it has not only transformed the business landscape in the Food Processing industry in China but also across the existing markets. The ability to lead change has enabled Shenyang Toly Bread in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Shenyang Toly Bread is one of the most innovative firm in Food Processing sector.
Diverse revenue streams
– Shenyang Toly Bread is present in almost all the verticals within the Food Processing industry. This has provided Shenyang Toly Bread 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.
Digital Transformation in Food Processing industry
- digital transformation varies from industry to industry. For Shenyang Toly Bread digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shenyang Toly Bread 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.
Operational resilience
– The operational resilience strategy of Shenyang Toly Bread comprises – understanding the underlying the factors in the Food Processing 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.
Training and development
– Shenyang Toly Bread 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.
Superior customer experience
– The customer experience strategy of Shenyang Toly Bread in Food Processing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Shenyang Toly Bread has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Shenyang Toly Bread staying ahead in the Food Processing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Shenyang Toly Bread has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Shenyang Toly Bread to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Food Processing industry
– Shenyang Toly Bread 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
– Shenyang Toly Bread has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Food Processing industry. Secondly the value chain collaborators of Shenyang Toly Bread have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Shenyang Toly Bread | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shenyang Toly Bread are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shenyang Toly Bread is slow explore the new channels of communication. These new channels of communication can help Shenyang Toly Bread to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
Employees’ less understanding of Shenyang Toly Bread strategy
– From the outside it seems that the employees of Shenyang Toly Bread 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.
Capital Spending Reduction
– Even during the low interest decade, Shenyang Toly Bread 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 Food Processing industry using digital technology.
Interest costs
– Compare to the competition, Shenyang Toly Bread 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.
No frontier risks strategy
– From the 10K / annual statement of Shenyang Toly Bread, it seems that company is thinking out the frontier risks that can impact Food Processing 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 Shenyang Toly Bread is dominated by functional specialists. It is not different from other players in the Food Processing industry, but Shenyang Toly Bread needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shenyang Toly Bread to focus more on services in the Food Processing industry rather than just following the product oriented approach.
Lack of clear differentiation of Shenyang Toly Bread products
– To increase the profitability and margins on the products, Shenyang Toly Bread needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Shenyang Toly Bread has some of the most successful models in the Food Processing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Shenyang Toly Bread should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, Shenyang Toly Bread has high operating costs in the Food Processing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Shenyang Toly Bread lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Shenyang Toly Bread has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Food Processing industry over the last five years. Shenyang Toly Bread 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.
High dependence on Shenyang Toly Bread ‘s star products
– The top 2 products and services of Shenyang Toly Bread still accounts for major business revenue. This dependence on star products in Food Processing industry has resulted into insufficient focus on developing new products, even though Shenyang Toly Bread has relatively successful track record of launching new products.
Shenyang Toly Bread Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Shenyang Toly Bread are -
Using analytics as competitive advantage
– Shenyang Toly Bread has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Food Processing sector. This continuous investment in analytics has enabled Shenyang Toly Bread to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shenyang Toly Bread to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Shenyang Toly Bread can use these opportunities to build new business models that can help the communities that Shenyang Toly Bread operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Shenyang Toly Bread is facing challenges because of the dominance of functional experts in the organization. Shenyang Toly Bread can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of Shenyang Toly Bread has opened avenues for new revenue streams for the organization in Food Processing industry. This can help Shenyang Toly Bread to build a more holistic ecosystem for Shenyang Toly Bread products in the Food Processing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Shenyang Toly Bread 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Shenyang Toly Bread can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Food Processing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Shenyang Toly Bread 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. Shenyang Toly Bread 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. Shenyang Toly Bread can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Shenyang Toly Bread can improve the customer journey of consumers in the Food Processing 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.
Manufacturing automation
– Shenyang Toly Bread can use the latest technology developments to improve its manufacturing and designing process in Food Processing 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.
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 Shenyang Toly Bread 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shenyang Toly Bread in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.
Leveraging digital technologies
– Shenyang Toly Bread 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.
Threats Shenyang Toly Bread External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Shenyang Toly Bread are -
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 Shenyang Toly Bread 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 Shenyang Toly Bread in the Food Processing sector and impact the bottomline of the organization.
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. Shenyang Toly Bread needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
Increasing wage structure of Shenyang Toly Bread
– 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 Shenyang Toly Bread.
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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Shenyang Toly Bread in Food Processing industry. The Food Processing 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.
Consumer confidence and its impact on Shenyang Toly Bread 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 Food Processing industry and other sectors.
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. Shenyang Toly Bread 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.
Environmental challenges
– Shenyang Toly Bread 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. Shenyang Toly Bread can take advantage of this fund but it will also bring new competitors in the Food Processing industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Food Processing industry are lowering. It can presents Shenyang Toly Bread with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Food Processing sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Shenyang Toly Bread 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 Shenyang Toly Bread prominent markets.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Shenyang Toly Bread may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing sector.
Weighted SWOT Analysis of Shenyang Toly Bread Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shenyang Toly Bread 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 Shenyang Toly Bread 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 Shenyang Toly Bread 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 Shenyang Toly Bread 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 Shenyang Toly Bread needs to make to build a sustainable competitive advantage.