SWOT Analysis

SWOT analysis is analyzing the strength, weaknesses, opportunities and the threats of the business organization in question.

Strengths

The organizational strengths are what they can do best to outdo their competitors. These includes utilizing the companies available resources to maximize profits as they reduce their costs. This in turn helps them to offer their services and products at appealing prices than their competitors. Thus, they are able to obtain and maintain more customers leading a larger market share. The utilization of strengths also helps in the production of quality goods that meets customer’s preferences.

Weaknesses

This makes the company to have competitive disadvantages because they are inferior to their competitors.  For example, the company may be producing few products than its competitors or its brand may not be known n the market. It also may lack qualified personnel who relates well with the customers

Opportunities

These are what the company can utilize from the internal and the external environment to b highly placed than its competitors. This includes availability of unique formulas in their product development and ability to acquire a larger market share in a niche market.

Threats

Threats include those things that can make the competitors to have a competitive advantage over the company in question. Threats can come from both the internal and the external environment. For example, entries of new companies and substitutes goods can affect the company’s market share.

PEST analysis

PEST analysis includes the analysis of political, economic, social, and technological factos that may affect a business organization.

Political factors

This includes legal issues and government regulations under, which a firm operates. They include taxation policies, environmental regulations, employment laws, trade regulations and barriers to trade among others.

Economic factors

These factors affect the purchasing power of the customers and the firm’s cost of capital. They include economic growth, economic inflation, interest and echange rate . this affect the customer’s income direct thus, affecting their purchasing ability.

Social factors

These are demographic and cultural feature, which include health consciousness, age distribution, occupations and general population growth rates.

Technological Factors

Technological factors include things like R&D activity, rate of technological, automation and technological incentives.