Zhangjiagang Furui Special Equip (300228) SWOT Analysis / TOWS Matrix / MBA Resources
Misc. Capital Goods
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Zhangjiagang Furui Special Equip (China)
Based on various researches at Oak Spring University , Zhangjiagang Furui Special Equip is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, increasing household debt because of falling income levels, technology disruption,
there is increasing trade war between United States & China, increasing commodity prices, etc
Introduction to SWOT Analysis of Zhangjiagang Furui Special Equip
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Zhangjiagang Furui Special Equip can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Zhangjiagang Furui Special Equip, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Zhangjiagang Furui Special Equip 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 Zhangjiagang Furui Special Equip can be done for the following purposes –
1. Strategic planning of Zhangjiagang Furui Special Equip
2. Improving business portfolio management of Zhangjiagang Furui Special Equip
3. Assessing feasibility of the new initiative in China
4. Making a Misc. Capital Goods sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Zhangjiagang Furui Special Equip
Strengths of Zhangjiagang Furui Special Equip | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Zhangjiagang Furui Special Equip are -
Low bargaining power of suppliers
– Suppliers of Zhangjiagang Furui Special Equip in the Capital Goods sector have low bargaining power. Zhangjiagang Furui Special Equip has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Zhangjiagang Furui Special Equip to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Zhangjiagang Furui Special Equip is one of the leading players in the Misc. Capital Goods 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.
Learning organization
- Zhangjiagang Furui Special Equip 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 Zhangjiagang Furui Special Equip is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Zhangjiagang Furui Special Equip emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Misc. Capital Goods industry
– Zhangjiagang Furui Special Equip has clearly differentiated products in the market place. This has enabled Zhangjiagang Furui Special Equip to fetch slight price premium compare to the competitors in the Misc. Capital Goods industry. The sustainable margins have also helped Zhangjiagang Furui Special Equip to invest into research and development (R&D) and innovation.
High brand equity
– Zhangjiagang Furui Special Equip has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Zhangjiagang Furui Special Equip to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Zhangjiagang Furui Special Equip has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Capital Goods industry. Secondly the value chain collaborators of Zhangjiagang Furui Special Equip have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Zhangjiagang Furui Special Equip has one of the best training and development program in Capital Goods 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.
Innovation driven organization
– Zhangjiagang Furui Special Equip is one of the most innovative firm in Misc. Capital Goods sector.
Strong track record of project management in the Misc. Capital Goods industry
– Zhangjiagang Furui Special Equip is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Zhangjiagang Furui Special Equip 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 Misc. Capital Goods 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.
Superior customer experience
– The customer experience strategy of Zhangjiagang Furui Special Equip in Misc. Capital Goods industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Misc. Capital Goods
– Zhangjiagang Furui Special Equip is one of the leading players in the Misc. Capital Goods industry in China. Over the years it has not only transformed the business landscape in the Misc. Capital Goods industry in China but also across the existing markets. The ability to lead change has enabled Zhangjiagang Furui Special Equip in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Zhangjiagang Furui Special Equip | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Zhangjiagang Furui Special Equip are -
High operating costs
– Compare to the competitors, Zhangjiagang Furui Special Equip has high operating costs in the Misc. Capital Goods industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Zhangjiagang Furui Special Equip lucrative customers.
High bargaining power of channel partners in Misc. Capital Goods industry
– because of the regulatory requirements in China, Zhangjiagang Furui Special Equip 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 Misc. Capital Goods industry.
High cash cycle compare to competitors
Zhangjiagang Furui Special Equip has a high cash cycle compare to other players in the Misc. Capital Goods industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative at Zhangjiagang Furui Special Equip, in the dynamic environment of Misc. Capital Goods industry it has struggled to respond to the nimble upstart competition. Zhangjiagang Furui Special Equip has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Zhangjiagang Furui Special Equip is dominated by functional specialists. It is not different from other players in the Misc. Capital Goods industry, but Zhangjiagang Furui Special Equip needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Zhangjiagang Furui Special Equip to focus more on services in the Misc. Capital Goods industry rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the Misc. Capital Goods industry, Zhangjiagang Furui Special Equip 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, Zhangjiagang Furui Special Equip has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Capital Goods industry over the last five years. Zhangjiagang Furui Special Equip 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.
Capital Spending Reduction
– Even during the low interest decade, Zhangjiagang Furui Special Equip 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 Misc. Capital Goods industry using digital technology.
Low market penetration in new markets
– Outside its home market of China, Zhangjiagang Furui Special Equip needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Zhangjiagang Furui Special Equip products
– To increase the profitability and margins on the products, Zhangjiagang Furui Special Equip needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on Zhangjiagang Furui Special Equip ‘s star products
– The top 2 products and services of Zhangjiagang Furui Special Equip still accounts for major business revenue. This dependence on star products in Misc. Capital Goods industry has resulted into insufficient focus on developing new products, even though Zhangjiagang Furui Special Equip has relatively successful track record of launching new products.
Zhangjiagang Furui Special Equip Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Zhangjiagang Furui Special Equip are -
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 Zhangjiagang Furui Special Equip 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Zhangjiagang Furui Special Equip is facing challenges because of the dominance of functional experts in the organization. Zhangjiagang Furui Special Equip can utilize new technology in the field of Misc. Capital Goods industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, 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, Zhangjiagang Furui Special Equip can use these opportunities to build new business models that can help the communities that Zhangjiagang Furui Special Equip operates in. Secondly it can use opportunities from government spending in Misc. Capital Goods sector.
Learning at scale
– Online learning technologies has now opened space for Zhangjiagang Furui Special Equip 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.
Creating value in data economy
– The success of analytics program of Zhangjiagang Furui Special Equip has opened avenues for new revenue streams for the organization in Misc. Capital Goods industry. This can help Zhangjiagang Furui Special Equip to build a more holistic ecosystem for Zhangjiagang Furui Special Equip products in the Misc. Capital Goods industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Zhangjiagang Furui Special Equip has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Capital Goods sector. This continuous investment in analytics has enabled Zhangjiagang Furui Special Equip to build a competitive advantage using analytics. The analytics driven competitive advantage can help Zhangjiagang Furui Special Equip to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Zhangjiagang Furui Special Equip can improve the customer journey of consumers in the Misc. Capital Goods 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.
Use of Bitcoin and other crypto currencies for transactions in Misc. Capital Goods industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Zhangjiagang Furui Special Equip in the Misc. Capital Goods industry. Now Zhangjiagang Furui Special Equip can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Zhangjiagang Furui Special Equip 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 Misc. Capital Goods industry.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Zhangjiagang Furui Special Equip can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Zhangjiagang Furui Special Equip in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Capital Goods industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Zhangjiagang Furui Special Equip to increase its market reach. Zhangjiagang Furui Special Equip will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Leveraging digital technologies
– Zhangjiagang Furui Special Equip 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.
Threats Zhangjiagang Furui Special Equip External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Zhangjiagang Furui Special Equip are -
Increasing wage structure of Zhangjiagang Furui Special Equip
– 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 Zhangjiagang Furui Special Equip.
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. Zhangjiagang Furui Special Equip 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.
Technology acceleration in Forth Industrial Revolution
– Zhangjiagang Furui Special Equip has witnessed rapid integration of technology during Covid-19 in the Misc. Capital Goods industry. As one of the leading players in the industry, Zhangjiagang Furui Special Equip needs to keep up with the evolution of technology in the Misc. Capital Goods 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Capital Goods industry are lowering. It can presents Zhangjiagang Furui Special Equip with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Capital Goods sector.
Shortening product life cycle
– it is one of the major threat that Zhangjiagang Furui Special Equip is facing in Misc. Capital Goods sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Zhangjiagang Furui Special Equip in the Misc. Capital Goods sector and impact the bottomline of the organization.
Consumer confidence and its impact on Zhangjiagang Furui Special Equip 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 Misc. Capital Goods industry and other sectors.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Zhangjiagang Furui Special Equip in Misc. Capital Goods industry. The Misc. Capital Goods 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.
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 Zhangjiagang Furui Special Equip business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Misc. Capital Goods industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Zhangjiagang Furui Special Equip can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Zhangjiagang Furui Special Equip 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 Misc. Capital Goods industry.
High dependence on third party suppliers
– Zhangjiagang Furui Special Equip 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.
Weighted SWOT Analysis of Zhangjiagang Furui Special Equip Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Zhangjiagang Furui Special Equip 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 Zhangjiagang Furui Special Equip 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 Zhangjiagang Furui Special Equip 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 Zhangjiagang Furui Special Equip 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 Zhangjiagang Furui Special Equip needs to make to build a sustainable competitive advantage.
