SWOT Analysis / TOWS Matrix for Liuzhou Liangmianzhen (China)
Based on various researches at Oak Spring University , Liuzhou Liangmianzhen is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , geopolitical disruptions, increasing transportation and logistics costs, there is backlash against globalization, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation,
increasing commodity prices, technology disruption, etc
Introduction to SWOT Analysis of Liuzhou Liangmianzhen
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Liuzhou Liangmianzhen can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Liuzhou Liangmianzhen, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen can be done for the following purposes –
1. Strategic planning of Liuzhou Liangmianzhen
2. Improving business portfolio management of Liuzhou Liangmianzhen
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 Liuzhou Liangmianzhen
Strengths of Liuzhou Liangmianzhen | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Liuzhou Liangmianzhen are -
Strong track record of project management in the Personal & Household Prods. industry
– Liuzhou Liangmianzhen is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Liuzhou Liangmianzhen 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.
Highly skilled collaborators
– Liuzhou Liangmianzhen has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Personal & Household Prods. industry. Secondly the value chain collaborators of Liuzhou Liangmianzhen have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Personal & Household Prods. industry
– Liuzhou Liangmianzhen has clearly differentiated products in the market place. This has enabled Liuzhou Liangmianzhen to fetch slight price premium compare to the competitors in the Personal & Household Prods. industry. The sustainable margins have also helped Liuzhou Liangmianzhen to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Liuzhou Liangmianzhen in the Consumer/Non-Cyclical sector have low bargaining power. Liuzhou Liangmianzhen has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Liuzhou Liangmianzhen to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Liuzhou Liangmianzhen
– The covid-19 pandemic has put organizational resilience at the centre of everthing Liuzhou Liangmianzhen does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Liuzhou Liangmianzhen has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Liuzhou Liangmianzhen staying ahead in the Personal & Household Prods. industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Liuzhou Liangmianzhen in Personal & Household Prods. industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Liuzhou Liangmianzhen 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.
Diverse revenue streams
– Liuzhou Liangmianzhen is present in almost all the verticals within the Personal & Household Prods. industry. This has provided Liuzhou Liangmianzhen 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 lead change in Personal & Household Prods.
– Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Liuzhou Liangmianzhen 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.
Weaknesses of Liuzhou Liangmianzhen | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Liuzhou Liangmianzhen are -
High dependence on Liuzhou Liangmianzhen ‘s star products
– The top 2 products and services of Liuzhou Liangmianzhen still accounts for major business revenue. This dependence on star products in Personal & Household Prods. industry has resulted into insufficient focus on developing new products, even though Liuzhou Liangmianzhen has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Liuzhou Liangmianzhen 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, Liuzhou Liangmianzhen is slow explore the new channels of communication. These new channels of communication can help Liuzhou Liangmianzhen 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.
Slow to strategic competitive environment developments
– As Liuzhou Liangmianzhen is one of the leading players in the Personal & Household Prods. industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Personal & Household Prods. industry in last five years.
Aligning sales with marketing
– From the outside it seems that Liuzhou Liangmianzhen needs to have more collaboration between its sales team and marketing team. Sales professionals in the Personal & Household Prods. industry have deep experience in developing customer relationships. Marketing department at Liuzhou Liangmianzhen can leverage the sales team experience to cultivate customer relationships as Liuzhou Liangmianzhen is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Liuzhou Liangmianzhen 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.
Compensation and incentives
– The revenue per employee of Liuzhou Liangmianzhen 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.
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 Liuzhou Liangmianzhen supply chain. Even after few cautionary changes, Liuzhou Liangmianzhen is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Liuzhou Liangmianzhen vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the Personal & Household Prods. industry, Liuzhou Liangmianzhen 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.
Products dominated business model
– Even though Liuzhou Liangmianzhen 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. Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen, in the dynamic environment of Personal & Household Prods. industry it has struggled to respond to the nimble upstart competition. Liuzhou Liangmianzhen has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Liuzhou Liangmianzhen Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Liuzhou Liangmianzhen are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Liuzhou Liangmianzhen can use these opportunities to build new business models that can help the communities that Liuzhou Liangmianzhen operates in. Secondly it can use opportunities from government spending in Personal & Household Prods. sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Personal & Household Prods. industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Liuzhou Liangmianzhen 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. Liuzhou Liangmianzhen 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Liuzhou Liangmianzhen 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.
Developing new processes and practices
– Liuzhou Liangmianzhen can develop new processes and procedures in Personal & Household Prods. 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.
Use of Bitcoin and other crypto currencies for transactions in Personal & Household Prods. industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Liuzhou Liangmianzhen in the Personal & Household Prods. industry. Now Liuzhou Liangmianzhen can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Liuzhou Liangmianzhen has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Personal & Household Prods. sector. This continuous investment in analytics has enabled Liuzhou Liangmianzhen to build a competitive advantage using analytics. The analytics driven competitive advantage can help Liuzhou Liangmianzhen to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Liuzhou Liangmianzhen 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
– Liuzhou Liangmianzhen 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen to hire the very best people irrespective of their geographical location.
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. Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen 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.
Leveraging digital technologies
– Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Liuzhou Liangmianzhen are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Liuzhou Liangmianzhen may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Personal & Household Prods. sector.
Shortening product life cycle
– it is one of the major threat that Liuzhou Liangmianzhen is facing in Personal & Household Prods. sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Liuzhou Liangmianzhen
– 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 Liuzhou Liangmianzhen.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen 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.
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. Liuzhou Liangmianzhen 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Personal & Household Prods. industry are lowering. It can presents Liuzhou Liangmianzhen with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Personal & Household Prods. sector.
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 Liuzhou Liangmianzhen in the Personal & Household Prods. sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Liuzhou Liangmianzhen has witnessed rapid integration of technology during Covid-19 in the Personal & Household Prods. industry. As one of the leading players in the industry, Liuzhou Liangmianzhen needs to keep up with the evolution of technology in the Personal & Household Prods. 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen prominent markets.
Environmental challenges
– Liuzhou Liangmianzhen 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. Liuzhou Liangmianzhen can take advantage of this fund but it will also bring new competitors in the Personal & Household Prods. industry.
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. Liuzhou Liangmianzhen can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Weighted SWOT Analysis of Liuzhou Liangmianzhen Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen 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 Liuzhou Liangmianzhen needs to make to build a sustainable competitive advantage.
