Based on various researches at Oak Spring University , Jiangsu King's Luck Brewery is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, geopolitical disruptions, increasing transportation and logistics costs, there is increasing trade war between United States & China, increasing commodity prices,
digital marketing is dominated by two big players Facebook and Google, technology disruption, etc
Introduction to SWOT Analysis of Jiangsu King's Luck Brewery
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jiangsu King's Luck Brewery can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jiangsu King's Luck Brewery, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery can be done for the following purposes –
1. Strategic planning of Jiangsu King's Luck Brewery
2. Improving business portfolio management of Jiangsu King's Luck Brewery
3. Assessing feasibility of the new initiative in China
4. Making a Beverages (Alcoholic) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jiangsu King's Luck Brewery
Strengths of Jiangsu King's Luck Brewery | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jiangsu King's Luck Brewery are -
Operational resilience
– The operational resilience strategy of Jiangsu King's Luck Brewery 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.
Diverse revenue streams
– Jiangsu King's Luck Brewery is present in almost all the verticals within the Beverages (Alcoholic) industry. This has provided Jiangsu King's Luck Brewery 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.
Sustainable margins compare to other players in Beverages (Alcoholic) industry
– Jiangsu King's Luck Brewery has clearly differentiated products in the market place. This has enabled Jiangsu King's Luck Brewery to fetch slight price premium compare to the competitors in the Beverages (Alcoholic) industry. The sustainable margins have also helped Jiangsu King's Luck Brewery to invest into research and development (R&D) and innovation.
Ability to lead change in Beverages (Alcoholic)
– Jiangsu King's Luck Brewery is one of the leading players in the Beverages (Alcoholic) industry in China. Over the years it has not only transformed the business landscape in the Beverages (Alcoholic) industry in China but also across the existing markets. The ability to lead change has enabled Jiangsu King's Luck Brewery in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Jiangsu King's Luck Brewery is one of the most innovative firm in Beverages (Alcoholic) sector.
Low bargaining power of suppliers
– Suppliers of Jiangsu King's Luck Brewery in the Consumer/Non-Cyclical sector have low bargaining power. Jiangsu King's Luck Brewery has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jiangsu King's Luck Brewery to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Jiangsu King's Luck Brewery in Beverages (Alcoholic) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Jiangsu King's Luck Brewery
– The covid-19 pandemic has put organizational resilience at the centre of everthing Jiangsu King's Luck Brewery does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Jiangsu King's Luck Brewery 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 Beverages (Alcoholic) industry. The technology infrastructure of China 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.
Strong track record of project management in the Beverages (Alcoholic) industry
– Jiangsu King's Luck Brewery is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Jiangsu King's Luck Brewery 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.
Ability to recruit top talent
– Jiangsu King's Luck Brewery is one of the leading players in the Beverages (Alcoholic) industry in China. It is in a position to attract the best talent available in China. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses of Jiangsu King's Luck Brewery | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jiangsu King's Luck Brewery are -
Lack of clear differentiation of Jiangsu King's Luck Brewery products
– To increase the profitability and margins on the products, Jiangsu King's Luck Brewery needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ less understanding of Jiangsu King's Luck Brewery strategy
– From the outside it seems that the employees of Jiangsu King's Luck Brewery 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.
Skills based hiring in Beverages (Alcoholic) industry
– The stress on hiring functional specialists at Jiangsu King's Luck Brewery 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 dependence on Jiangsu King's Luck Brewery ‘s star products
– The top 2 products and services of Jiangsu King's Luck Brewery still accounts for major business revenue. This dependence on star products in Beverages (Alcoholic) industry has resulted into insufficient focus on developing new products, even though Jiangsu King's Luck Brewery has relatively successful track record of launching new products.
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 Jiangsu King's Luck Brewery supply chain. Even after few cautionary changes, Jiangsu King's Luck Brewery is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jiangsu King's Luck Brewery vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Jiangsu King's Luck Brewery 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.
No frontier risks strategy
– From the 10K / annual statement of Jiangsu King's Luck Brewery, 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.
Ability to respond to the competition
– As the decision making is very deliberative at Jiangsu King's Luck Brewery, in the dynamic environment of Beverages (Alcoholic) industry it has struggled to respond to the nimble upstart competition. Jiangsu King's Luck Brewery has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Jiangsu King's Luck Brewery has some of the most successful models in the Beverages (Alcoholic) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Jiangsu King's Luck Brewery should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Jiangsu King's Luck Brewery is slow explore the new channels of communication. These new channels of communication can help Jiangsu King's Luck Brewery to provide better information regarding Beverages (Alcoholic) products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Jiangsu King's Luck Brewery 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. Jiangsu King's Luck Brewery 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.
Jiangsu King's Luck Brewery Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jiangsu King's Luck Brewery are -
Manufacturing automation
– Jiangsu King's Luck Brewery can use the latest technology developments to improve its manufacturing and designing process in Beverages (Alcoholic) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jiangsu King's Luck Brewery 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Beverages (Alcoholic) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Jiangsu King's Luck Brewery 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. Jiangsu King's Luck Brewery 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.
Learning at scale
– Online learning technologies has now opened space for Jiangsu King's Luck Brewery 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.
Better consumer reach
– The expansion of the 5G network will help Jiangsu King's Luck Brewery to increase its market reach. Jiangsu King's Luck Brewery 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.
Leveraging digital technologies
– Jiangsu King's Luck Brewery 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jiangsu King's Luck Brewery to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Jiangsu King's Luck Brewery in the Beverages (Alcoholic) industry. Now Jiangsu King's Luck Brewery can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jiangsu King's Luck Brewery 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.
Building a culture of innovation
– managers at Jiangsu King's Luck Brewery 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 Beverages (Alcoholic) industry.
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. Jiangsu King's Luck Brewery can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jiangsu King's Luck Brewery can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Jiangsu King's Luck Brewery External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jiangsu King's Luck Brewery are -
Consumer confidence and its impact on Jiangsu King's Luck Brewery 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 Beverages (Alcoholic) industry and other sectors.
Increasing wage structure of Jiangsu King's Luck Brewery
– 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 Jiangsu King's Luck Brewery.
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.
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. Jiangsu King's Luck Brewery can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Jiangsu King's Luck Brewery 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.
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. Jiangsu King's Luck Brewery 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Beverages (Alcoholic) industry are lowering. It can presents Jiangsu King's Luck Brewery with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Beverages (Alcoholic) 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 Jiangsu King's Luck Brewery business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Jiangsu King's Luck Brewery 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. Jiangsu King's Luck Brewery can take advantage of this fund but it will also bring new competitors in the Beverages (Alcoholic) industry.
Technology acceleration in Forth Industrial Revolution
– Jiangsu King's Luck Brewery has witnessed rapid integration of technology during Covid-19 in the Beverages (Alcoholic) industry. As one of the leading players in the industry, Jiangsu King's Luck Brewery needs to keep up with the evolution of technology in the Beverages (Alcoholic) 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
– Jiangsu King's Luck Brewery 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery prominent markets.
Stagnating economy with rate increase
– Jiangsu King's Luck Brewery 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.
Weighted SWOT Analysis of Jiangsu King's Luck Brewery Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery 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 Jiangsu King's Luck Brewery needs to make to build a sustainable competitive advantage.
