China Putian Food (1699) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for China Putian Food (Hong Kong)

Based on various researches at Oak Spring University , China Putian Food is operating in a macro-environment that has been destablized by – increasing commodity prices, technology disruption, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, etc

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Introduction to SWOT Analysis of China Putian Food

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that China Putian Food can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the China Putian Food, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which China Putian Food 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 China Putian Food can be done for the following purposes –
1. Strategic planning of China Putian Food
2. Improving business portfolio management of China Putian Food
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Fish/Livestock sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of China Putian Food

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Strengths of China Putian Food | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of China Putian Food are -

Sustainable margins compare to other players in Fish/Livestock industry

– China Putian Food has clearly differentiated products in the market place. This has enabled China Putian Food to fetch slight price premium compare to the competitors in the Fish/Livestock industry. The sustainable margins have also helped China Putian Food to invest into research and development (R&D) and innovation.

Analytics focus

– China Putian Food 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 Fish/Livestock 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.

High switching costs

– The high switching costs that China Putian Food 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.

Operational resilience

– The operational resilience strategy of China Putian Food comprises – understanding the underlying the factors in the Fish/Livestock 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.

Strong track record of project management in the Fish/Livestock industry

– China Putian Food is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Cross disciplinary teams

– Horizontal connected teams at the China Putian Food 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.

Successful track record of launching new products

– China Putian Food has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. China Putian Food 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 brand equity

– China Putian Food has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled China Putian Food to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Low bargaining power of suppliers

– Suppliers of China Putian Food in the Consumer/Non-Cyclical sector have low bargaining power. China Putian Food has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps China Putian Food to manage not only supply disruptions but also source products at highly competitive prices.

Superior customer experience

– The customer experience strategy of China Putian Food in Fish/Livestock industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Ability to recruit top talent

– China Putian Food is one of the leading players in the Fish/Livestock industry in Hong Kong. It is in a position to attract the best talent available in Hong Kong. The firm has a robust talent identification program that helps in identifying the brightest.

Digital Transformation in Fish/Livestock industry

- digital transformation varies from industry to industry. For China Putian Food digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. China Putian Food 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.

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Weaknesses of China Putian Food | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of China Putian Food are -

High bargaining power of channel partners in Fish/Livestock industry

– because of the regulatory requirements in Hong Kong, China Putian Food 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 Fish/Livestock industry.

Employees’ less understanding of China Putian Food strategy

– From the outside it seems that the employees of China Putian Food don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

High dependence on China Putian Food ‘s star products

– The top 2 products and services of China Putian Food still accounts for major business revenue. This dependence on star products in Fish/Livestock industry has resulted into insufficient focus on developing new products, even though China Putian Food has relatively successful track record of launching new products.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, China Putian Food is slow explore the new channels of communication. These new channels of communication can help China Putian Food to provide better information regarding Fish/Livestock products and services. It can also build an online community to further reach out to potential customers.

High operating costs

– Compare to the competitors, China Putian Food has high operating costs in the Fish/Livestock industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract China Putian Food lucrative customers.

Compensation and incentives

– The revenue per employee of China Putian Food is just above the Fish/Livestock 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.

No frontier risks strategy

– From the 10K / annual statement of China Putian Food, it seems that company is thinking out the frontier risks that can impact Fish/Livestock 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 cash cycle compare to competitors

China Putian Food has a high cash cycle compare to other players in the Fish/Livestock industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Products dominated business model

– Even though China Putian Food has some of the most successful models in the Fish/Livestock industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. China Putian Food should strive to include more intangible value offerings along with its core products and services.

Slow to strategic competitive environment developments

– As China Putian Food is one of the leading players in the Fish/Livestock industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Fish/Livestock industry in last five years.

Skills based hiring in Fish/Livestock industry

– The stress on hiring functional specialists at China Putian Food has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.

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China Putian Food Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of China Putian Food are -

Lowering marketing communication costs

– 5G expansion will open new opportunities for China Putian Food in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Fish/Livestock industry, and it will provide faster access to the consumers.

Loyalty marketing

– China Putian Food 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, China Putian Food 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, China Putian Food is facing challenges because of the dominance of functional experts in the organization. China Putian Food can utilize new technology in the field of Fish/Livestock industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Building a culture of innovation

– managers at China Putian Food 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 Fish/Livestock industry.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects China Putian Food can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Creating value in data economy

– The success of analytics program of China Putian Food has opened avenues for new revenue streams for the organization in Fish/Livestock industry. This can help China Putian Food to build a more holistic ecosystem for China Putian Food products in the Fish/Livestock industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Buying journey improvements

– China Putian Food can improve the customer journey of consumers in the Fish/Livestock 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.

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. China Putian Food 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 Fish/Livestock industry, but it has also influenced the consumer preferences. China Putian Food can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

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 China Putian Food 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for China Putian Food 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 China Putian Food to hire the very best people irrespective of their geographical location.

Leveraging digital technologies

– China Putian Food 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.

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Threats China Putian Food External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of China Putian Food are -

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for China Putian Food in Fish/Livestock industry. The Fish/Livestock 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.

Technology acceleration in Forth Industrial Revolution

– China Putian Food has witnessed rapid integration of technology during Covid-19 in the Fish/Livestock industry. As one of the leading players in the industry, China Putian Food needs to keep up with the evolution of technology in the Fish/Livestock 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, China Putian Food may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Fish/Livestock sector.

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. China Putian Food 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. China Putian Food needs to understand the core reasons impacting the Fish/Livestock industry. This will help it in building a better workplace.

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 China Putian Food in the Fish/Livestock sector and impact the bottomline of the organization.

Increasing wage structure of China Putian Food

– 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 China Putian Food.

High dependence on third party suppliers

– China Putian Food 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.

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 China Putian Food business can come under increasing regulations regarding data privacy, data security, etc.

Environmental challenges

– China Putian Food 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. China Putian Food can take advantage of this fund but it will also bring new competitors in the Fish/Livestock industry.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Fish/Livestock industry are lowering. It can presents China Putian Food with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Fish/Livestock sector.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, China Putian Food 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 China Putian Food prominent markets.

Easy access to finance

– Easy access to finance in Fish/Livestock industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. China Putian Food can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

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Weighted SWOT Analysis of China Putian Food Template, Example

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

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