I did this recently in one of my networking groups and was surprised to learn it was something many of the small business owners hadn’t done before. I firmly believe business and marketing plans should contain SWOT
analyses; I find it’s a beneficial tool to help you gauge potential business decisions and key issues. SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats. It is a tool for auditing an organization and its current environment. Generally, the strengths and weaknesses categories are a reflection of internal, while opportunities and threats are often external factors.
A SWOT analysis shows good awareness of your business and your current position in the market. Therefore, it’s important, to be honest and as thorough as you can when conducting your SWOT analysis.
Depending on the business development decision you’re considering, you may also want to put yourself in your competitor’s shoes and perform a SWOT analysis from their point of view.
Here’s what a SWOT analysis looks like:
Photo Credit: Concept Draw
Now, let’s break down the four quadrants of the SWOT:
Top Row-Strengths and Weaknesses
Your strengths show your business opportunities. Your weaknesses pose a threat to those business advancements.
A strength could be:
- A new, innovative product or service.
- Location of your business.
- Quality customer service
A weakness could be:
- Undifferentiated products or services in your market.
- Location of your business.
- Poor quality products and a damaged reputation.
Bottom Row- Opportunities and Threats
List business opportunities in the bottom left (again your strengths will guide you). For example, healthy cash flow offers the opportunity to borrow money to expand your company or hire more employees. These opportunities may help your team change focus on your marketing and business objectives so once you have the list, it’s important to prioritize what you need to be up to.
Threats go in the bottom right, and many of these will be a reflection of your current weaknesses. But many will be external factors from your competition. These threats will make it difficult to achieve your opportunities.
An opportunity could be:
- Partnerships or joint ventures
- New market segments that offer increased profits.
- Expansion to a new market.
- Growth in a market vacated by an ineffective competitor.
A threat could be:
- Price wars with competitors.
- A competitor with an innovative product or service.
- Competitors with better distribution channels.
- New competition!
The main purpose of doing a SWOT analysis is to add value to your products and services to get new customers, build loyal advocates, and stay on top of market-driven decisions. We should aim to turn our weaknesses into strengths, and our threats into opportunities; take a look to see who on your team has the personal strengths to reach your goals. A good SWOT can help your entire team develop professionally while increasing value for your clients. This turns into more opportunities down the line too!
I recommend a SWOT analysis at least once a year to stay on top of what new opportunities and threats may be in your market. This also helps to guide your marketing objectives. Contact Corin Harmon, owner of Charisma Communications in Tampa to learn more!
Do a SWOT analysis at least yearly to stay on top of opportunities & threats that may be in your market. #brandyourcharisma #marketingtips
When doing a SWOT analysis, leverage your strengths to achieve what goals make the most sense for your customers. #brandyourcharisma