Daphne Int Holdings (210) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Daphne Int Holdings (Hong Kong)

Based on various researches at Oak Spring University , Daphne Int Holdings is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, there is backlash against globalization, increasing household debt because of falling income levels, etc

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Introduction to SWOT Analysis of Daphne Int Holdings

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

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Strengths of Daphne Int Holdings | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Daphne Int Holdings are -

Strong track record of project management in the Footwear industry

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

Effective Research and Development (R&D)

– Daphne Int Holdings has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Daphne Int Holdings staying ahead in the Footwear industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Innovation driven organization

– Daphne Int Holdings is one of the most innovative firm in Footwear sector.

Ability to lead change in Footwear

– Daphne Int Holdings is one of the leading players in the Footwear industry in Hong Kong. Over the years it has not only transformed the business landscape in the Footwear industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Daphne Int Holdings in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Diverse revenue streams

– Daphne Int Holdings is present in almost all the verticals within the Footwear industry. This has provided Daphne Int Holdings 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.

Sustainable margins compare to other players in Footwear industry

– Daphne Int Holdings has clearly differentiated products in the market place. This has enabled Daphne Int Holdings to fetch slight price premium compare to the competitors in the Footwear industry. The sustainable margins have also helped Daphne Int Holdings to invest into research and development (R&D) and innovation.

Highly skilled collaborators

– Daphne Int Holdings has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Footwear industry. Secondly the value chain collaborators of Daphne Int Holdings have helped the firm to develop new products and bring them quickly to the marketplace.

Learning organization

- Daphne Int Holdings is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Daphne Int Holdings is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Daphne Int Holdings emphasize – knowledge, initiative, and innovation.

Digital Transformation in Footwear industry

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

High switching costs

– The high switching costs that Daphne Int Holdings 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.

Organizational Resilience of Daphne Int Holdings

– The covid-19 pandemic has put organizational resilience at the centre of everthing Daphne Int Holdings does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

High brand equity

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

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Weaknesses of Daphne Int Holdings | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Daphne Int Holdings are -

Interest costs

– Compare to the competition, Daphne Int Holdings 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.

Ability to respond to the competition

– As the decision making is very deliberative at Daphne Int Holdings, in the dynamic environment of Footwear industry it has struggled to respond to the nimble upstart competition. Daphne Int Holdings has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

High dependence on Daphne Int Holdings ‘s star products

– The top 2 products and services of Daphne Int Holdings still accounts for major business revenue. This dependence on star products in Footwear industry has resulted into insufficient focus on developing new products, even though Daphne Int Holdings 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 Daphne Int Holdings supply chain. Even after few cautionary changes, Daphne Int Holdings is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Daphne Int Holdings vulnerable to further global disruptions in South East Asia.

Slow to harness new channels of communication

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

Workers concerns about automation

– As automation is fast increasing in the Footwear industry, Daphne Int Holdings 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.

Increasing silos among functional specialists

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

High cash cycle compare to competitors

Daphne Int Holdings has a high cash cycle compare to other players in the Footwear 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 Footwear industry

– because of the regulatory requirements in Hong Kong, Daphne Int Holdings 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 Footwear industry.

High operating costs

– Compare to the competitors, Daphne Int Holdings has high operating costs in the Footwear industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Daphne Int Holdings lucrative customers.

Slow to strategic competitive environment developments

– As Daphne Int Holdings is one of the leading players in the Footwear industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Footwear industry in last five years.

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Daphne Int Holdings Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Daphne Int Holdings 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, Daphne Int Holdings can use these opportunities to build new business models that can help the communities that Daphne Int Holdings operates in. Secondly it can use opportunities from government spending in Footwear sector.

Building a culture of innovation

– managers at Daphne Int Holdings 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 Footwear industry.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Daphne Int Holdings is facing challenges because of the dominance of functional experts in the organization. Daphne Int Holdings can utilize new technology in the field of Footwear industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

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 Daphne Int Holdings 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.

Better consumer reach

– The expansion of the 5G network will help Daphne Int Holdings to increase its market reach. Daphne Int Holdings 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.

Creating value in data economy

– The success of analytics program of Daphne Int Holdings has opened avenues for new revenue streams for the organization in Footwear industry. This can help Daphne Int Holdings to build a more holistic ecosystem for Daphne Int Holdings products in the Footwear industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Reforming the budgeting process

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

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Daphne Int Holdings 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 Daphne Int Holdings to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

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. Daphne Int Holdings 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 Daphne Int Holdings in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Footwear 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 Footwear industry, but it has also influenced the consumer preferences. Daphne Int Holdings can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Loyalty marketing

– Daphne Int Holdings 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, Daphne Int Holdings 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.

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Threats Daphne Int Holdings External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Daphne Int Holdings are -

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Daphne Int Holdings in Footwear industry. The Footwear 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.

Easy access to finance

– Easy access to finance in Footwear industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Daphne Int Holdings 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 Footwear industry are lowering. It can presents Daphne Int Holdings with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Footwear sector.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Daphne Int Holdings 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 Daphne Int Holdings prominent markets.

High dependence on third party suppliers

– Daphne Int Holdings 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.

Shortening product life cycle

– it is one of the major threat that Daphne Int Holdings is facing in Footwear sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Environmental challenges

– Daphne Int Holdings 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. Daphne Int Holdings can take advantage of this fund but it will also bring new competitors in the Footwear industry.

Stagnating economy with rate increase

– Daphne Int Holdings can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Footwear industry.

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.

Regulatory challenges

– Daphne Int Holdings 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 Footwear industry regulations.

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

– Daphne Int Holdings has witnessed rapid integration of technology during Covid-19 in the Footwear industry. As one of the leading players in the industry, Daphne Int Holdings needs to keep up with the evolution of technology in the Footwear 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 wage structure of Daphne Int Holdings

– 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 Daphne Int Holdings.

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Weighted SWOT Analysis of Daphne Int Holdings Template, Example

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

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