SWOT Analysis / TOWS Matrix for Chongqing Zaisheng Tech (China)
Based on various researches at Oak Spring University , Chongqing Zaisheng Tech is operating in a macro-environment that has been destablized by – wage bills are increasing, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing transportation and logistics costs, there is backlash against globalization,
challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Chongqing Zaisheng Tech
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Chongqing Zaisheng Tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chongqing Zaisheng Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech can be done for the following purposes –
1. Strategic planning of Chongqing Zaisheng Tech
2. Improving business portfolio management of Chongqing Zaisheng Tech
3. Assessing feasibility of the new initiative in China
4. Making a Personal & Household Prods. sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Chongqing Zaisheng Tech
Strengths of Chongqing Zaisheng Tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chongqing Zaisheng Tech are -
Analytics focus
– Chongqing Zaisheng Tech 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 Personal & Household Prods. 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.
Ability to recruit top talent
– Chongqing Zaisheng Tech is one of the leading players in the Personal & Household Prods. 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.
Innovation driven organization
– Chongqing Zaisheng Tech is one of the most innovative firm in Personal & Household Prods. sector.
Digital Transformation in Personal & Household Prods. industry
- digital transformation varies from industry to industry. For Chongqing Zaisheng Tech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chongqing Zaisheng Tech 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.
High brand equity
– Chongqing Zaisheng Tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chongqing Zaisheng Tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Chongqing Zaisheng Tech in the Consumer/Non-Cyclical sector have low bargaining power. Chongqing Zaisheng Tech has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chongqing Zaisheng Tech to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Chongqing Zaisheng Tech emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Chongqing Zaisheng Tech
– The covid-19 pandemic has put organizational resilience at the centre of everthing Chongqing Zaisheng Tech does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Personal & Household Prods.
– Chongqing Zaisheng Tech is one of the leading players in the Personal & Household Prods. industry in China. Over the years it has not only transformed the business landscape in the Personal & Household Prods. industry in China but also across the existing markets. The ability to lead change has enabled Chongqing Zaisheng Tech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Personal & Household Prods. industry
– Chongqing Zaisheng Tech has clearly differentiated products in the market place. This has enabled Chongqing Zaisheng Tech to fetch slight price premium compare to the competitors in the Personal & Household Prods. industry. The sustainable margins have also helped Chongqing Zaisheng Tech to invest into research and development (R&D) and innovation.
Training and development
– Chongqing Zaisheng Tech 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.
Diverse revenue streams
– Chongqing Zaisheng Tech is present in almost all the verticals within the Personal & Household Prods. industry. This has provided Chongqing Zaisheng Tech 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.
Weaknesses of Chongqing Zaisheng Tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chongqing Zaisheng Tech are -
Slow decision making process
– As mentioned earlier in the report, Chongqing Zaisheng Tech has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Personal & Household Prods. industry over the last five years. Chongqing Zaisheng Tech 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 cash cycle compare to competitors
Chongqing Zaisheng Tech has a high cash cycle compare to other players in the Personal & Household Prods. industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Products dominated business model
– Even though Chongqing Zaisheng Tech has some of the most successful models in the Personal & Household Prods. industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Chongqing Zaisheng Tech should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Chongqing Zaisheng Tech 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, Chongqing Zaisheng Tech is slow explore the new channels of communication. These new channels of communication can help Chongqing Zaisheng Tech to provide better information regarding Personal & Household Prods. products and services. It can also build an online community to further reach out to potential customers.
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 Chongqing Zaisheng Tech supply chain. Even after few cautionary changes, Chongqing Zaisheng Tech is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Chongqing Zaisheng Tech vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Chongqing Zaisheng Tech has high operating costs in the Personal & Household Prods. industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Chongqing Zaisheng Tech lucrative customers.
Compensation and incentives
– The revenue per employee of Chongqing Zaisheng Tech is just above the Personal & Household Prods. 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, Chongqing Zaisheng Tech 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 Personal & Household Prods. industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Chongqing Zaisheng Tech is dominated by functional specialists. It is not different from other players in the Personal & Household Prods. industry, but Chongqing Zaisheng Tech needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chongqing Zaisheng Tech to focus more on services in the Personal & Household Prods. industry rather than just following the product oriented approach.
No frontier risks strategy
– From the 10K / annual statement of Chongqing Zaisheng Tech, it seems that company is thinking out the frontier risks that can impact Personal & Household Prods. 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.
Chongqing Zaisheng Tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Chongqing Zaisheng Tech are -
Building a culture of innovation
– managers at Chongqing Zaisheng Tech 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 Personal & Household Prods. industry.
Manufacturing automation
– Chongqing Zaisheng Tech can use the latest technology developments to improve its manufacturing and designing process in Personal & Household Prods. 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chongqing Zaisheng Tech can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Chongqing Zaisheng Tech can improve the customer journey of consumers in the Personal & Household Prods. 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chongqing Zaisheng Tech in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Personal & Household Prods. industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Personal & Household Prods. industry, but it has also influenced the consumer preferences. Chongqing Zaisheng Tech can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Chongqing Zaisheng Tech 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Chongqing Zaisheng Tech can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Chongqing Zaisheng Tech to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Chongqing Zaisheng Tech has opened avenues for new revenue streams for the organization in Personal & Household Prods. industry. This can help Chongqing Zaisheng Tech to build a more holistic ecosystem for Chongqing Zaisheng Tech products in the Personal & Household Prods. industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Chongqing Zaisheng Tech to increase its market reach. Chongqing Zaisheng Tech 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.
Loyalty marketing
– Chongqing Zaisheng Tech 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chongqing Zaisheng Tech can use these opportunities to build new business models that can help the communities that Chongqing Zaisheng Tech operates in. Secondly it can use opportunities from government spending in Personal & Household Prods. sector.
Threats Chongqing Zaisheng Tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Chongqing Zaisheng Tech are -
High dependence on third party suppliers
– Chongqing Zaisheng Tech high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Easy access to finance
– Easy access to finance in Personal & Household Prods. industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Chongqing Zaisheng Tech can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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 Chongqing Zaisheng Tech in the Personal & Household Prods. sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech prominent markets.
Stagnating economy with rate increase
– Chongqing Zaisheng Tech 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 Personal & Household Prods. industry.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Chongqing Zaisheng Tech.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chongqing Zaisheng Tech in Personal & Household Prods. industry. The Personal & Household Prods. 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 Chongqing Zaisheng Tech 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 Personal & Household Prods. industry and other sectors.
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. Chongqing Zaisheng Tech needs to understand the core reasons impacting the Personal & Household Prods. industry. This will help it in building a better workplace.
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 Chongqing Zaisheng Tech business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Chongqing Zaisheng Tech
– 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 Chongqing Zaisheng Tech.
Environmental challenges
– Chongqing Zaisheng Tech 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. Chongqing Zaisheng Tech can take advantage of this fund but it will also bring new competitors in the Personal & Household Prods. industry.
Weighted SWOT Analysis of Chongqing Zaisheng Tech Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech 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 Chongqing Zaisheng Tech needs to make to build a sustainable competitive advantage.