SDIC Zhonglu Fruit Juice (600962) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for SDIC Zhonglu Fruit Juice (China)

Based on various researches at Oak Spring University , SDIC Zhonglu Fruit Juice is operating in a macro-environment that has been destablized by – there is backlash against globalization, increasing household debt because of falling income levels, technology disruption, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, geopolitical disruptions, etc

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Introduction to SWOT Analysis of SDIC Zhonglu Fruit Juice

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that SDIC Zhonglu Fruit Juice can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the SDIC Zhonglu Fruit Juice, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which SDIC Zhonglu Fruit Juice 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of SDIC Zhonglu Fruit Juice can be done for the following purposes –
1. Strategic planning of SDIC Zhonglu Fruit Juice
2. Improving business portfolio management of SDIC Zhonglu Fruit Juice
3. Assessing feasibility of the new initiative in China
4. Making a Beverages (Nonalcoholic) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of SDIC Zhonglu Fruit Juice

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Strengths of SDIC Zhonglu Fruit Juice | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of SDIC Zhonglu Fruit Juice are -

Ability to recruit top talent

– SDIC Zhonglu Fruit Juice is one of the leading players in the Beverages (Nonalcoholic) 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.

Superior customer experience

– The customer experience strategy of SDIC Zhonglu Fruit Juice in Beverages (Nonalcoholic) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Sustainable margins compare to other players in Beverages (Nonalcoholic) industry

– SDIC Zhonglu Fruit Juice has clearly differentiated products in the market place. This has enabled SDIC Zhonglu Fruit Juice to fetch slight price premium compare to the competitors in the Beverages (Nonalcoholic) industry. The sustainable margins have also helped SDIC Zhonglu Fruit Juice to invest into research and development (R&D) and innovation.

Analytics focus

– SDIC Zhonglu Fruit Juice is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Beverages (Nonalcoholic) 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.

Highly skilled collaborators

– SDIC Zhonglu Fruit Juice has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Beverages (Nonalcoholic) industry. Secondly the value chain collaborators of SDIC Zhonglu Fruit Juice have helped the firm to develop new products and bring them quickly to the marketplace.

Successful track record of launching new products

– SDIC Zhonglu Fruit Juice has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. SDIC Zhonglu Fruit Juice has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.

High switching costs

– The high switching costs that SDIC Zhonglu Fruit Juice has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.

Diverse revenue streams

– SDIC Zhonglu Fruit Juice is present in almost all the verticals within the Beverages (Nonalcoholic) industry. This has provided SDIC Zhonglu Fruit Juice 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.

Cross disciplinary teams

– Horizontal connected teams at the SDIC Zhonglu Fruit Juice 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.

Training and development

– SDIC Zhonglu Fruit Juice 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.

Strong track record of project management in the Beverages (Nonalcoholic) industry

– SDIC Zhonglu Fruit Juice is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Ability to lead change in Beverages (Nonalcoholic)

– SDIC Zhonglu Fruit Juice is one of the leading players in the Beverages (Nonalcoholic) industry in China. Over the years it has not only transformed the business landscape in the Beverages (Nonalcoholic) industry in China but also across the existing markets. The ability to lead change has enabled SDIC Zhonglu Fruit Juice in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

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Weaknesses of SDIC Zhonglu Fruit Juice | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of SDIC Zhonglu Fruit Juice are -

High cash cycle compare to competitors

SDIC Zhonglu Fruit Juice has a high cash cycle compare to other players in the Beverages (Nonalcoholic) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

High bargaining power of channel partners in Beverages (Nonalcoholic) industry

– because of the regulatory requirements in China, SDIC Zhonglu Fruit Juice 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 Beverages (Nonalcoholic) industry.

Compensation and incentives

– The revenue per employee of SDIC Zhonglu Fruit Juice is just above the Beverages (Nonalcoholic) 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.

Increasing silos among functional specialists

– The organizational structure of SDIC Zhonglu Fruit Juice is dominated by functional specialists. It is not different from other players in the Beverages (Nonalcoholic) industry, but SDIC Zhonglu Fruit Juice needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help SDIC Zhonglu Fruit Juice to focus more on services in the Beverages (Nonalcoholic) industry rather than just following the product oriented approach.

Capital Spending Reduction

– Even during the low interest decade, SDIC Zhonglu Fruit Juice has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Beverages (Nonalcoholic) industry using digital technology.

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 SDIC Zhonglu Fruit Juice supply chain. Even after few cautionary changes, SDIC Zhonglu Fruit Juice is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left SDIC Zhonglu Fruit Juice vulnerable to further global disruptions in South East Asia.

Aligning sales with marketing

– From the outside it seems that SDIC Zhonglu Fruit Juice needs to have more collaboration between its sales team and marketing team. Sales professionals in the Beverages (Nonalcoholic) industry have deep experience in developing customer relationships. Marketing department at SDIC Zhonglu Fruit Juice can leverage the sales team experience to cultivate customer relationships as SDIC Zhonglu Fruit Juice is planning to shift buying processes online.

Workers concerns about automation

– As automation is fast increasing in the Beverages (Nonalcoholic) industry, SDIC Zhonglu Fruit Juice 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.

Need for greater diversity

– SDIC Zhonglu Fruit Juice has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.

High dependence on SDIC Zhonglu Fruit Juice ‘s star products

– The top 2 products and services of SDIC Zhonglu Fruit Juice still accounts for major business revenue. This dependence on star products in Beverages (Nonalcoholic) industry has resulted into insufficient focus on developing new products, even though SDIC Zhonglu Fruit Juice has relatively successful track record of launching new products.

No frontier risks strategy

– From the 10K / annual statement of SDIC Zhonglu Fruit Juice, it seems that company is thinking out the frontier risks that can impact Beverages (Nonalcoholic) 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.

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SDIC Zhonglu Fruit Juice Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of SDIC Zhonglu Fruit Juice are -

Identify volunteer opportunities

– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. SDIC Zhonglu Fruit Juice can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Beverages (Nonalcoholic) industry, but it has also influenced the consumer preferences. SDIC Zhonglu Fruit Juice can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Using analytics as competitive advantage

– SDIC Zhonglu Fruit Juice has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Beverages (Nonalcoholic) sector. This continuous investment in analytics has enabled SDIC Zhonglu Fruit Juice to build a competitive advantage using analytics. The analytics driven competitive advantage can help SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice to hire the very best people irrespective of their geographical location.

Lowering marketing communication costs

– 5G expansion will open new opportunities for SDIC Zhonglu Fruit Juice in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Beverages (Nonalcoholic) industry, and it will provide faster access to the consumers.

Leveraging digital technologies

– SDIC Zhonglu Fruit Juice 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, SDIC Zhonglu Fruit Juice is facing challenges because of the dominance of functional experts in the organization. SDIC Zhonglu Fruit Juice can utilize new technology in the field of Beverages (Nonalcoholic) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Buying journey improvements

– SDIC Zhonglu Fruit Juice can improve the customer journey of consumers in the Beverages (Nonalcoholic) 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

– SDIC Zhonglu Fruit Juice can develop new processes and procedures in Beverages (Nonalcoholic) 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.

Loyalty marketing

– SDIC Zhonglu Fruit Juice 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.

Use of Bitcoin and other crypto currencies for transactions in Beverages (Nonalcoholic) industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for SDIC Zhonglu Fruit Juice in the Beverages (Nonalcoholic) industry. Now SDIC Zhonglu Fruit Juice can target international markets with far fewer capital restrictions requirements than the existing system.

Creating value in data economy

– The success of analytics program of SDIC Zhonglu Fruit Juice has opened avenues for new revenue streams for the organization in Beverages (Nonalcoholic) industry. This can help SDIC Zhonglu Fruit Juice to build a more holistic ecosystem for SDIC Zhonglu Fruit Juice products in the Beverages (Nonalcoholic) industry by providing – data insight services, data privacy related products, data based consulting services, etc.

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Threats SDIC Zhonglu Fruit Juice External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of SDIC Zhonglu Fruit Juice are -

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 SDIC Zhonglu Fruit Juice business can come under increasing regulations regarding data privacy, data security, etc.

Environmental challenges

– SDIC Zhonglu Fruit Juice 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. SDIC Zhonglu Fruit Juice can take advantage of this fund but it will also bring new competitors in the Beverages (Nonalcoholic) industry.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for SDIC Zhonglu Fruit Juice in Beverages (Nonalcoholic) industry. The Beverages (Nonalcoholic) 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 SDIC Zhonglu Fruit Juice 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 Beverages (Nonalcoholic) industry and other sectors.

Easy access to finance

– Easy access to finance in Beverages (Nonalcoholic) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. SDIC Zhonglu Fruit Juice can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Beverages (Nonalcoholic) industry are lowering. It can presents SDIC Zhonglu Fruit Juice with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Beverages (Nonalcoholic) sector.

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.

Increasing wage structure of SDIC Zhonglu Fruit Juice

– 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 SDIC Zhonglu Fruit Juice.

Technology acceleration in Forth Industrial Revolution

– SDIC Zhonglu Fruit Juice has witnessed rapid integration of technology during Covid-19 in the Beverages (Nonalcoholic) industry. As one of the leading players in the industry, SDIC Zhonglu Fruit Juice needs to keep up with the evolution of technology in the Beverages (Nonalcoholic) 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.

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. SDIC Zhonglu Fruit Juice needs to understand the core reasons impacting the Beverages (Nonalcoholic) industry. This will help it in building a better workplace.

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.

Shortening product life cycle

– it is one of the major threat that SDIC Zhonglu Fruit Juice is facing in Beverages (Nonalcoholic) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice prominent markets.

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Weighted SWOT Analysis of SDIC Zhonglu Fruit Juice Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice 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 SDIC Zhonglu Fruit Juice needs to make to build a sustainable competitive advantage.

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