Sichuan Sunny Seal (300470) SWOT Analysis / TOWS Matrix / MBA Resources
Fabricated Plastic & Rubber
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Sichuan Sunny Seal (China)
Based on various researches at Oak Spring University , Sichuan Sunny Seal is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, increasing transportation and logistics costs, increasing energy prices, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, increasing commodity prices,
cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Sichuan Sunny Seal
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sichuan Sunny Seal can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sichuan Sunny Seal, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sichuan Sunny Seal 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 Sichuan Sunny Seal can be done for the following purposes –
1. Strategic planning of Sichuan Sunny Seal
2. Improving business portfolio management of Sichuan Sunny Seal
3. Assessing feasibility of the new initiative in China
4. Making a Fabricated Plastic & Rubber sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sichuan Sunny Seal
Strengths of Sichuan Sunny Seal | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sichuan Sunny Seal are -
Analytics focus
– Sichuan Sunny Seal 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 Fabricated Plastic & Rubber 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.
Successful track record of launching new products
– Sichuan Sunny Seal has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sichuan Sunny Seal 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.
Strong track record of project management in the Fabricated Plastic & Rubber industry
– Sichuan Sunny Seal is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Sichuan Sunny Seal has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Sichuan Sunny Seal staying ahead in the Fabricated Plastic & Rubber industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Sichuan Sunny Seal has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sichuan Sunny Seal to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Sichuan Sunny Seal in Fabricated Plastic & Rubber industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Sichuan Sunny Seal has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to lead change in Fabricated Plastic & Rubber
– Sichuan Sunny Seal is one of the leading players in the Fabricated Plastic & Rubber industry in China. Over the years it has not only transformed the business landscape in the Fabricated Plastic & Rubber industry in China but also across the existing markets. The ability to lead change has enabled Sichuan Sunny Seal in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy of Sichuan Sunny Seal comprises – understanding the underlying the factors in the Fabricated Plastic & Rubber 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.
Sustainable margins compare to other players in Fabricated Plastic & Rubber industry
– Sichuan Sunny Seal has clearly differentiated products in the market place. This has enabled Sichuan Sunny Seal to fetch slight price premium compare to the competitors in the Fabricated Plastic & Rubber industry. The sustainable margins have also helped Sichuan Sunny Seal to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Sichuan Sunny Seal has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Fabricated Plastic & Rubber industry. Secondly the value chain collaborators of Sichuan Sunny Seal have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Sichuan Sunny Seal 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 Sichuan Sunny Seal is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Sichuan Sunny Seal emphasize – knowledge, initiative, and innovation.
Weaknesses of Sichuan Sunny Seal | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sichuan Sunny Seal are -
Need for greater diversity
– Sichuan Sunny Seal 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.
Increasing silos among functional specialists
– The organizational structure of Sichuan Sunny Seal is dominated by functional specialists. It is not different from other players in the Fabricated Plastic & Rubber industry, but Sichuan Sunny Seal needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sichuan Sunny Seal to focus more on services in the Fabricated Plastic & Rubber industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of China, Sichuan Sunny Seal needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the Fabricated Plastic & Rubber industry, Sichuan Sunny Seal needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow decision making process
– As mentioned earlier in the report, Sichuan Sunny Seal has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Fabricated Plastic & Rubber industry over the last five years. Sichuan Sunny Seal 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.
Compensation and incentives
– The revenue per employee of Sichuan Sunny Seal is just above the Fabricated Plastic & Rubber 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.
Capital Spending Reduction
– Even during the low interest decade, Sichuan Sunny Seal 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 Fabricated Plastic & Rubber industry using digital technology.
Aligning sales with marketing
– From the outside it seems that Sichuan Sunny Seal needs to have more collaboration between its sales team and marketing team. Sales professionals in the Fabricated Plastic & Rubber industry have deep experience in developing customer relationships. Marketing department at Sichuan Sunny Seal can leverage the sales team experience to cultivate customer relationships as Sichuan Sunny Seal is planning to shift buying processes online.
No frontier risks strategy
– From the 10K / annual statement of Sichuan Sunny Seal, it seems that company is thinking out the frontier risks that can impact Fabricated Plastic & Rubber 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 Sichuan Sunny Seal, in the dynamic environment of Fabricated Plastic & Rubber industry it has struggled to respond to the nimble upstart competition. Sichuan Sunny Seal has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Sichuan Sunny Seal products
– To increase the profitability and margins on the products, Sichuan Sunny Seal needs to provide more differentiated products than what it is currently offering in the marketplace.
Sichuan Sunny Seal Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sichuan Sunny Seal are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sichuan Sunny Seal in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Fabricated Plastic & Rubber industry, and it will provide faster access to the consumers.
Use of Bitcoin and other crypto currencies for transactions in Fabricated Plastic & Rubber industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Sichuan Sunny Seal in the Fabricated Plastic & Rubber industry. Now Sichuan Sunny Seal can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Sichuan Sunny Seal has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Fabricated Plastic & Rubber sector. This continuous investment in analytics has enabled Sichuan Sunny Seal to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sichuan Sunny Seal to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Fabricated Plastic & Rubber industry, but it has also influenced the consumer preferences. Sichuan Sunny Seal can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Sichuan Sunny Seal 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 Fabricated Plastic & Rubber industry.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sichuan Sunny Seal is facing challenges because of the dominance of functional experts in the organization. Sichuan Sunny Seal can utilize new technology in the field of Fabricated Plastic & Rubber industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Sichuan Sunny Seal can develop new processes and procedures in Fabricated Plastic & Rubber 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.
Leveraging digital technologies
– Sichuan Sunny Seal 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.
Manufacturing automation
– Sichuan Sunny Seal can use the latest technology developments to improve its manufacturing and designing process in Fabricated Plastic & Rubber 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 Sichuan Sunny Seal to increase its market reach. Sichuan Sunny Seal 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.
Learning at scale
– Online learning technologies has now opened space for Sichuan Sunny Seal 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sichuan Sunny Seal 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.
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 Sichuan Sunny Seal 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.
Threats Sichuan Sunny Seal External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sichuan Sunny Seal are -
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing wage structure of Sichuan Sunny Seal
– 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 Sichuan Sunny Seal.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sichuan Sunny Seal 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 Sichuan Sunny Seal prominent markets.
Shortening product life cycle
– it is one of the major threat that Sichuan Sunny Seal is facing in Fabricated Plastic & Rubber sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Sichuan Sunny Seal needs to understand the core reasons impacting the Fabricated Plastic & Rubber industry. This will help it in building a better workplace.
Environmental challenges
– Sichuan Sunny Seal 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. Sichuan Sunny Seal can take advantage of this fund but it will also bring new competitors in the Fabricated Plastic & Rubber industry.
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 Sichuan Sunny Seal 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 Sichuan Sunny Seal in Fabricated Plastic & Rubber industry. The Fabricated Plastic & Rubber 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Fabricated Plastic & Rubber industry are lowering. It can presents Sichuan Sunny Seal with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Fabricated Plastic & Rubber sector.
Technology acceleration in Forth Industrial Revolution
– Sichuan Sunny Seal has witnessed rapid integration of technology during Covid-19 in the Fabricated Plastic & Rubber industry. As one of the leading players in the industry, Sichuan Sunny Seal needs to keep up with the evolution of technology in the Fabricated Plastic & Rubber 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.
Stagnating economy with rate increase
– Sichuan Sunny Seal 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 Fabricated Plastic & Rubber industry.
Consumer confidence and its impact on Sichuan Sunny Seal 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 Fabricated Plastic & Rubber industry and other sectors.
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 Sichuan Sunny Seal Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sichuan Sunny Seal 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 Sichuan Sunny Seal 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 Sichuan Sunny Seal 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 Sichuan Sunny Seal 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 Sichuan Sunny Seal needs to make to build a sustainable competitive advantage.