SWOT Analysis / TOWS Matrix for Kuaijishan Shaoxing Wine (China)
Based on various researches at Oak Spring University , Kuaijishan Shaoxing Wine is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models,
increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Kuaijishan Shaoxing Wine
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kuaijishan Shaoxing Wine can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kuaijishan Shaoxing Wine, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine can be done for the following purposes –
1. Strategic planning of Kuaijishan Shaoxing Wine
2. Improving business portfolio management of Kuaijishan Shaoxing Wine
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 Kuaijishan Shaoxing Wine
Strengths of Kuaijishan Shaoxing Wine | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kuaijishan Shaoxing Wine are -
Superior customer experience
– The customer experience strategy of Kuaijishan Shaoxing Wine in Beverages (Alcoholic) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Kuaijishan Shaoxing Wine has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Beverages (Alcoholic) industry. Secondly the value chain collaborators of Kuaijishan Shaoxing Wine have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Kuaijishan Shaoxing Wine
– The covid-19 pandemic has put organizational resilience at the centre of everthing Kuaijishan Shaoxing Wine does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Beverages (Alcoholic)
– Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Kuaijishan Shaoxing Wine 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.
Diverse revenue streams
– Kuaijishan Shaoxing Wine is present in almost all the verticals within the Beverages (Alcoholic) industry. This has provided Kuaijishan Shaoxing Wine 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.
Ability to recruit top talent
– Kuaijishan Shaoxing Wine 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.
Cross disciplinary teams
– Horizontal connected teams at the Kuaijishan Shaoxing Wine 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.
Analytics focus
– Kuaijishan Shaoxing Wine 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.
Low bargaining power of suppliers
– Suppliers of Kuaijishan Shaoxing Wine in the Consumer/Non-Cyclical sector have low bargaining power. Kuaijishan Shaoxing Wine has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kuaijishan Shaoxing Wine to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Kuaijishan Shaoxing Wine emphasize – knowledge, initiative, and innovation.
Training and development
– Kuaijishan Shaoxing Wine 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.
Weaknesses of Kuaijishan Shaoxing Wine | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kuaijishan Shaoxing Wine are -
Capital Spending Reduction
– Even during the low interest decade, Kuaijishan Shaoxing Wine 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.
Slow to strategic competitive environment developments
– As Kuaijishan Shaoxing Wine is one of the leading players in the Beverages (Alcoholic) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Beverages (Alcoholic) industry in last five years.
Low market penetration in new markets
– Outside its home market of China, Kuaijishan Shaoxing Wine needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Kuaijishan Shaoxing Wine 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kuaijishan Shaoxing Wine is slow explore the new channels of communication. These new channels of communication can help Kuaijishan Shaoxing Wine to provide better information regarding Beverages (Alcoholic) products and services. It can also build an online community to further reach out to potential customers.
Employees’ less understanding of Kuaijishan Shaoxing Wine strategy
– From the outside it seems that the employees of Kuaijishan Shaoxing Wine 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.
Aligning sales with marketing
– From the outside it seems that Kuaijishan Shaoxing Wine needs to have more collaboration between its sales team and marketing team. Sales professionals in the Beverages (Alcoholic) industry have deep experience in developing customer relationships. Marketing department at Kuaijishan Shaoxing Wine can leverage the sales team experience to cultivate customer relationships as Kuaijishan Shaoxing Wine is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee of Kuaijishan Shaoxing Wine is just above the Beverages (Alcoholic) 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 operating costs
– Compare to the competitors, Kuaijishan Shaoxing Wine has high operating costs in the Beverages (Alcoholic) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Kuaijishan Shaoxing Wine lucrative customers.
No frontier risks strategy
– From the 10K / annual statement of Kuaijishan Shaoxing Wine, 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 Kuaijishan Shaoxing Wine, in the dynamic environment of Beverages (Alcoholic) industry it has struggled to respond to the nimble upstart competition. Kuaijishan Shaoxing Wine has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Kuaijishan Shaoxing Wine Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kuaijishan Shaoxing Wine are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Kuaijishan Shaoxing Wine can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Kuaijishan Shaoxing Wine has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kuaijishan Shaoxing Wine is facing challenges because of the dominance of functional experts in the organization. Kuaijishan Shaoxing Wine can utilize new technology in the field of Beverages (Alcoholic) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Learning at scale
– Online learning technologies has now opened space for Kuaijishan Shaoxing Wine 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.
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 Kuaijishan Shaoxing Wine 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.
Leveraging digital technologies
– Kuaijishan Shaoxing Wine 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.
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. Kuaijishan Shaoxing Wine 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. Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kuaijishan Shaoxing Wine 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 Beverages (Alcoholic) industry, but it has also influenced the consumer preferences. Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine has opened avenues for new revenue streams for the organization in Beverages (Alcoholic) industry. This can help Kuaijishan Shaoxing Wine to build a more holistic ecosystem for Kuaijishan Shaoxing Wine products in the Beverages (Alcoholic) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
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 Kuaijishan Shaoxing Wine in the Beverages (Alcoholic) industry. Now Kuaijishan Shaoxing Wine can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Kuaijishan Shaoxing Wine can improve the customer journey of consumers in the Beverages (Alcoholic) 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.
Threats Kuaijishan Shaoxing Wine External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kuaijishan Shaoxing Wine are -
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.
Technology acceleration in Forth Industrial Revolution
– Kuaijishan Shaoxing Wine has witnessed rapid integration of technology during Covid-19 in the Beverages (Alcoholic) industry. As one of the leading players in the industry, Kuaijishan Shaoxing Wine 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.
Shortening product life cycle
– it is one of the major threat that Kuaijishan Shaoxing Wine is facing in Beverages (Alcoholic) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Kuaijishan Shaoxing Wine 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.
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 Kuaijishan Shaoxing Wine business can come under increasing regulations regarding data privacy, data security, 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. Kuaijishan Shaoxing Wine needs to understand the core reasons impacting the Beverages (Alcoholic) industry. This will help it in building a better workplace.
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.
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. Kuaijishan Shaoxing Wine 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.
Regulatory challenges
– Kuaijishan Shaoxing Wine 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.
Environmental challenges
– Kuaijishan Shaoxing Wine 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. Kuaijishan Shaoxing Wine can take advantage of this fund but it will also bring new competitors in the Beverages (Alcoholic) industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Beverages (Alcoholic) industry are lowering. It can presents Kuaijishan Shaoxing Wine with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Beverages (Alcoholic) sector.
Stagnating economy with rate increase
– Kuaijishan Shaoxing Wine 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.
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. Kuaijishan Shaoxing Wine can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Kuaijishan Shaoxing Wine Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine 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 Kuaijishan Shaoxing Wine needs to make to build a sustainable competitive advantage.
