SWOT Analysis / TOWS Matrix for Shenzhen Huapengfei Logistics (China)
Based on various researches at Oak Spring University , Shenzhen Huapengfei Logistics is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , increasing household debt because of falling income levels, wage bills are increasing, increasing transportation and logistics costs, increasing energy prices, increasing commodity prices, central banks are concerned over increasing inflation,
digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, etc
Introduction to SWOT Analysis of Shenzhen Huapengfei Logistics
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shenzhen Huapengfei Logistics can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shenzhen Huapengfei Logistics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics can be done for the following purposes –
1. Strategic planning of Shenzhen Huapengfei Logistics
2. Improving business portfolio management of Shenzhen Huapengfei Logistics
3. Assessing feasibility of the new initiative in China
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shenzhen Huapengfei Logistics
Strengths of Shenzhen Huapengfei Logistics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shenzhen Huapengfei Logistics are -
Innovation driven organization
– Shenzhen Huapengfei Logistics is one of the most innovative firm in Business Services sector.
Strong track record of project management in the Business Services industry
– Shenzhen Huapengfei Logistics 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)
– Shenzhen Huapengfei Logistics has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Shenzhen Huapengfei Logistics staying ahead in the Business Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Shenzhen Huapengfei Logistics 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.
Ability to lead change in Business Services
– Shenzhen Huapengfei Logistics is one of the leading players in the Business Services industry in China. Over the years it has not only transformed the business landscape in the Business Services industry in China but also across the existing markets. The ability to lead change has enabled Shenzhen Huapengfei Logistics 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 Business Services industry
– Shenzhen Huapengfei Logistics has clearly differentiated products in the market place. This has enabled Shenzhen Huapengfei Logistics to fetch slight price premium compare to the competitors in the Business Services industry. The sustainable margins have also helped Shenzhen Huapengfei Logistics to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Shenzhen Huapengfei Logistics has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Business Services industry. Secondly the value chain collaborators of Shenzhen Huapengfei Logistics have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Shenzhen Huapengfei Logistics in the Services sector have low bargaining power. Shenzhen Huapengfei Logistics has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shenzhen Huapengfei Logistics to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Shenzhen Huapengfei Logistics has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Shenzhen Huapengfei Logistics to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Shenzhen Huapengfei Logistics is present in almost all the verticals within the Business Services industry. This has provided Shenzhen Huapengfei Logistics 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.
Analytics focus
– Shenzhen Huapengfei Logistics 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 Business Services 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.
Learning organization
- Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Shenzhen Huapengfei Logistics emphasize – knowledge, initiative, and innovation.
Weaknesses of Shenzhen Huapengfei Logistics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shenzhen Huapengfei Logistics are -
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 Shenzhen Huapengfei Logistics supply chain. Even after few cautionary changes, Shenzhen Huapengfei Logistics is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Shenzhen Huapengfei Logistics vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Shenzhen Huapengfei Logistics is one of the leading players in the Business Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Business Services industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Business Services industry, Shenzhen Huapengfei Logistics 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.
Low market penetration in new markets
– Outside its home market of China, Shenzhen Huapengfei Logistics needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Shenzhen Huapengfei Logistics has some of the most successful models in the Business Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Shenzhen Huapengfei Logistics should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative at Shenzhen Huapengfei Logistics, in the dynamic environment of Business Services industry it has struggled to respond to the nimble upstart competition. Shenzhen Huapengfei Logistics has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners in Business Services industry
– because of the regulatory requirements in China, Shenzhen Huapengfei Logistics is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Business Services industry.
High dependence on Shenzhen Huapengfei Logistics ‘s star products
– The top 2 products and services of Shenzhen Huapengfei Logistics still accounts for major business revenue. This dependence on star products in Business Services industry has resulted into insufficient focus on developing new products, even though Shenzhen Huapengfei Logistics has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee of Shenzhen Huapengfei Logistics is just above the Business Services 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.
Interest costs
– Compare to the competition, Shenzhen Huapengfei Logistics 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 decision making process
– As mentioned earlier in the report, Shenzhen Huapengfei Logistics has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Business Services industry over the last five years. Shenzhen Huapengfei Logistics 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.
Shenzhen Huapengfei Logistics Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Shenzhen Huapengfei Logistics are -
Buying journey improvements
– Shenzhen Huapengfei Logistics can improve the customer journey of consumers in the Business Services 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.
Developing new processes and practices
– Shenzhen Huapengfei Logistics can develop new processes and procedures in Business Services 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Shenzhen Huapengfei Logistics is facing challenges because of the dominance of functional experts in the organization. Shenzhen Huapengfei Logistics can utilize new technology in the field of Business Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Shenzhen Huapengfei Logistics 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.
Creating value in data economy
– The success of analytics program of Shenzhen Huapengfei Logistics has opened avenues for new revenue streams for the organization in Business Services industry. This can help Shenzhen Huapengfei Logistics to build a more holistic ecosystem for Shenzhen Huapengfei Logistics products in the Business Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Shenzhen Huapengfei Logistics 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 Business Services industry.
Learning at scale
– Online learning technologies has now opened space for Shenzhen Huapengfei Logistics 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.
Loyalty marketing
– Shenzhen Huapengfei Logistics 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, Shenzhen Huapengfei Logistics can use these opportunities to build new business models that can help the communities that Shenzhen Huapengfei Logistics operates in. Secondly it can use opportunities from government spending in Business Services sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shenzhen Huapengfei Logistics in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Business Services industry, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics to hire the very best people irrespective of their geographical location.
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 Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Shenzhen Huapengfei Logistics are -
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 Shenzhen Huapengfei Logistics in the Business Services sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Shenzhen Huapengfei Logistics may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Business Services sector.
Increasing wage structure of Shenzhen Huapengfei Logistics
– 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 Shenzhen Huapengfei Logistics.
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. Shenzhen Huapengfei Logistics needs to understand the core reasons impacting the Business Services industry. This will help it in building a better workplace.
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. Shenzhen Huapengfei Logistics 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.
Shortening product life cycle
– it is one of the major threat that Shenzhen Huapengfei Logistics is facing in Business Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Shenzhen Huapengfei Logistics has witnessed rapid integration of technology during Covid-19 in the Business Services industry. As one of the leading players in the industry, Shenzhen Huapengfei Logistics needs to keep up with the evolution of technology in the Business Services 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.
Consumer confidence and its impact on Shenzhen Huapengfei Logistics 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 Business Services industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Business Services industry are lowering. It can presents Shenzhen Huapengfei Logistics with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Business Services sector.
Environmental challenges
– Shenzhen Huapengfei Logistics 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. Shenzhen Huapengfei Logistics can take advantage of this fund but it will also bring new competitors in the Business Services 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 Shenzhen Huapengfei Logistics business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Shenzhen Huapengfei Logistics 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.
Stagnating economy with rate increase
– Shenzhen Huapengfei Logistics 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 Business Services industry.
Weighted SWOT Analysis of Shenzhen Huapengfei Logistics Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics 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 Shenzhen Huapengfei Logistics needs to make to build a sustainable competitive advantage.
