Based on various researches at Oak Spring University , Perfect Shape Beauty Tech is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, technology disruption, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices,
increasing household debt because of falling income levels, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Perfect Shape Beauty Tech
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Perfect Shape Beauty Tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Perfect Shape Beauty Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Perfect Shape Beauty Tech operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Perfect Shape Beauty Tech can be done for the following purposes –
1. Strategic planning of Perfect Shape Beauty Tech
2. Improving business portfolio management of Perfect Shape Beauty Tech
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Personal Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Perfect Shape Beauty Tech
Strengths of Perfect Shape Beauty Tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Perfect Shape Beauty Tech are -
Sustainable margins compare to other players in Personal Services industry
– Perfect Shape Beauty Tech has clearly differentiated products in the market place. This has enabled Perfect Shape Beauty Tech to fetch slight price premium compare to the competitors in the Personal Services industry. The sustainable margins have also helped Perfect Shape Beauty Tech to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Perfect Shape Beauty Tech in Personal Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Perfect Shape Beauty Tech is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Personal Services industry. The technology infrastructure of Hong Kong 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.
Digital Transformation in Personal Services industry
- digital transformation varies from industry to industry. For Perfect Shape Beauty Tech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Perfect Shape Beauty Tech has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to lead change in Personal Services
– Perfect Shape Beauty Tech is one of the leading players in the Personal Services industry in Hong Kong. Over the years it has not only transformed the business landscape in the Personal Services industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Perfect Shape Beauty Tech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Perfect Shape Beauty Tech in the Services sector have low bargaining power. Perfect Shape Beauty Tech has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Perfect Shape Beauty Tech to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Perfect Shape Beauty Tech is present in almost all the verticals within the Personal Services industry. This has provided Perfect Shape Beauty Tech a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High brand equity
– Perfect Shape Beauty Tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Perfect Shape Beauty Tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy of Perfect Shape Beauty Tech comprises – understanding the underlying the factors in the Personal Services industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Successful track record of launching new products
– Perfect Shape Beauty Tech has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Perfect Shape Beauty Tech 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 Perfect Shape Beauty Tech 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.
Strong track record of project management in the Personal Services industry
– Perfect Shape Beauty Tech is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Perfect Shape Beauty Tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Perfect Shape Beauty Tech are -
High operating costs
– Compare to the competitors, Perfect Shape Beauty Tech has high operating costs in the Personal Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Perfect Shape Beauty Tech lucrative customers.
Interest costs
– Compare to the competition, Perfect Shape Beauty Tech has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
No frontier risks strategy
– From the 10K / annual statement of Perfect Shape Beauty Tech, it seems that company is thinking out the frontier risks that can impact Personal Services 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.
High bargaining power of channel partners in Personal Services industry
– because of the regulatory requirements in Hong Kong, Perfect Shape Beauty Tech 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 Personal Services industry.
Capital Spending Reduction
– Even during the low interest decade, Perfect Shape Beauty Tech has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Personal Services industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Perfect Shape Beauty Tech is slow explore the new channels of communication. These new channels of communication can help Perfect Shape Beauty Tech to provide better information regarding Personal Services products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Perfect Shape Beauty Tech has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Personal Services industry over the last five years. Perfect Shape Beauty Tech even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on Perfect Shape Beauty Tech ‘s star products
– The top 2 products and services of Perfect Shape Beauty Tech still accounts for major business revenue. This dependence on star products in Personal Services industry has resulted into insufficient focus on developing new products, even though Perfect Shape Beauty Tech has relatively successful track record of launching new products.
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 Perfect Shape Beauty Tech supply chain. Even after few cautionary changes, Perfect Shape Beauty Tech is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Perfect Shape Beauty Tech vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Perfect Shape Beauty Tech is dominated by functional specialists. It is not different from other players in the Personal Services industry, but Perfect Shape Beauty Tech needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Perfect Shape Beauty Tech to focus more on services in the Personal Services industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Perfect Shape Beauty Tech is one of the leading players in the Personal Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Personal Services industry in last five years.
Perfect Shape Beauty Tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Perfect Shape Beauty Tech are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Perfect Shape Beauty Tech can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Perfect Shape Beauty Tech 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Perfect Shape Beauty Tech is facing challenges because of the dominance of functional experts in the organization. Perfect Shape Beauty Tech can utilize new technology in the field of Personal Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of Perfect Shape Beauty Tech has opened avenues for new revenue streams for the organization in Personal Services industry. This can help Perfect Shape Beauty Tech to build a more holistic ecosystem for Perfect Shape Beauty Tech products in the Personal Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Perfect Shape Beauty Tech can use the latest technology developments to improve its manufacturing and designing process in Personal Services sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
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 Perfect Shape Beauty Tech to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Loyalty marketing
– Perfect Shape Beauty Tech has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Developing new processes and practices
– Perfect Shape Beauty Tech can develop new processes and procedures in Personal 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Perfect Shape Beauty Tech can use these opportunities to build new business models that can help the communities that Perfect Shape Beauty Tech operates in. Secondly it can use opportunities from government spending in Personal Services sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Perfect Shape Beauty Tech in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Personal Services industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Personal Services industry, but it has also influenced the consumer preferences. Perfect Shape Beauty Tech 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
– Perfect Shape Beauty Tech has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Personal Services sector. This continuous investment in analytics has enabled Perfect Shape Beauty Tech to build a competitive advantage using analytics. The analytics driven competitive advantage can help Perfect Shape Beauty Tech to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Perfect Shape Beauty Tech to increase its market reach. Perfect Shape Beauty Tech will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Threats Perfect Shape Beauty Tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Perfect Shape Beauty Tech are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Personal Services industry are lowering. It can presents Perfect Shape Beauty Tech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Personal Services sector.
Consumer confidence and its impact on Perfect Shape Beauty Tech demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Personal Services industry and other sectors.
Shortening product life cycle
– it is one of the major threat that Perfect Shape Beauty Tech is facing in Personal Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Perfect Shape Beauty Tech business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Personal Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Perfect Shape Beauty Tech can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Perfect Shape Beauty Tech 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.
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. Perfect Shape Beauty Tech needs to understand the core reasons impacting the Personal Services industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Perfect Shape Beauty Tech in Personal Services industry. The Personal Services 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.
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 Perfect Shape Beauty Tech in the Personal Services sector and impact the bottomline of the organization.
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.
Technology acceleration in Forth Industrial Revolution
– Perfect Shape Beauty Tech has witnessed rapid integration of technology during Covid-19 in the Personal Services industry. As one of the leading players in the industry, Perfect Shape Beauty Tech needs to keep up with the evolution of technology in the Personal 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.
Regulatory challenges
– Perfect Shape Beauty Tech needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Personal Services industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Perfect Shape Beauty Tech 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 Services sector.
Weighted SWOT Analysis of Perfect Shape Beauty Tech Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Perfect Shape Beauty Tech needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Perfect Shape Beauty Tech is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Perfect Shape Beauty Tech is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Perfect Shape Beauty Tech to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Perfect Shape Beauty Tech needs to make to build a sustainable competitive advantage.