If you’re interested in strategic planning for your business, you’ve likely come across the term SWOT analysis. SWOT analysis identifies a business’s strengths, weaknesses, opportunities, and threats. In this article, we will share how to perform SWOT analysis of a company. So, let’s begin. 

What is SWOT analysis? 

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. The first two represent internal factors – elements that your organization has some control over. The latter two, on the other hand, are external factors – conditions in the market or broader environment that are out of your direct control but can still significantly impact your business. 

SWOT analysis provides a structured method to explore these elements, helping businesses to build robust strategies and make informed decisions.

Preparing for SWOT analysis. 

Before diving into the SWOT analysis, understanding everything about the company, business, and operating environment is essential. You should have clear objectives for the SWOT analysis. Ideally, you should define why you want to conduct a SWOT analysis now. 

• Is it about launching a new product?
• Do you want to enter a new market?
• Do you want to improve your internal processes? 

An underlying goal will help gather and review relevant data about your business and its environment, setting the stage for a well-informed SWOT analysis.

Simple framework to conduct SWOT analysis. 

Identifying your business’s strengths, weaknesses, opportunities, and threats is an easy way to identify early wins and market opportunities for growth. Here’s how to perform a SWOT analysis of a company: 

Step 1: Identify external factors — threats and opportunities. 

Contrary to the order of the letters in the acronym, start your SWOT analysis with external factors, opportunities, and threats. 

This approach allows you to understand the broader context in which your organization operates before examining its internal strengths and weaknesses.

Look at market trends, industry developments, socio-economic factors, technological advancements, and regulatory changes to identify potential opportunities and threats.

Also Read: Market Research Trends

Step 2: Outline the internal factors — strengths and weaknesses. 

Once you’ve identified external factors, it’s time to focus on your strengths and weaknesses. 

You can look for these in your USP, positioning, product attributes, and a general understanding of the product/service. 

A great way to identify the strengths and weaknesses is to use online reviews. Your customers must’ve left reviews about your service, product, shopping experience, and other things online.

Use GapScout to scan for online reviews and gather inputs for your SWOT analysis on autopilot. 

Step 3: Analyzing and organizing SWOT data. 

Once you’ve gathered and populated all the data, you should document the SWOT analysis in quadrants and analyze the insights. 

The process might include planning the future roadmap or optimizing your existing plan based on the data or insights you gathered. For example, utilizing the identified opportunities to grow faster using your strengths. 

Section 4: From SWOT analysis to strategic planning. 

SWOT analysis in itself won’t give you any actionable insights. Instead, it will provide a roadmap to refine your future actions. You really need to turn the analysis into actionable strategies, like plugging your weaknesses to mitigate all the threads. Here are a few applications and real-world examples of how one can use SWOT analysis for their business: 

• Product Development: A tech company can leverage a SWOT analysis to assess market opportunities, threats, and internal strengths and weaknesses to develop the product and achieve PMF faster.
• Market Expansion: A retail company can use SWOT analysis to assess the new market opportunities and threats, along with their strengths and weaknesses, to power their market penetration growth strategy.
• Mergers and Acquisitions: Companies can use a SWOT analysis to evaluate the pros and cons of a potential merger or acquisition, informing their decision-making process and integration strategy.
• Crisis Management: SWOT analysis can help companies assess threats and opportunities during a crisis and their internal strengths and weaknesses to develop a comprehensive crisis management strategy.
• Strategic Reorientation: Companies can use a SWOT analysis to identify new opportunities and threats, and reassess their strengths and weaknesses, to develop a new strategic direction for growth and competitiveness.

Real-world example of SWOT analysis. 

Sometime back, we used ChatGPT for market research for a hypothetical online-only dog food brand in the US. Let’s assume the company needs to do a SWOT analysis for its growth plan. Here’s how the SWOT would look for the brand: 

Strengths

Sample strengths:

1. High-quality, nutritionally balanced dog food formulated by veterinary nutritionists.
2. User-friendly website and mobile app providing a seamless shopping experience.
3. Strong online presence and active engagement with customers on social media platforms.
4. Subscription model for recurring deliveries, offering convenience for customers and predictable revenue for the company.

Weaknesses

Sample weaknesses:

1. Limited physical presence due to being an online-only brand, which might limit reach to customers who prefer buying in physical stores.
2. Higher price point compared to some competitors due to premium ingredients, potentially limiting market share among cost-conscious customers.
3. Reliance on third-party logistics, which could potentially lead to shipping delays or issues.

Opportunities

Sample opportunities:

1. Increasing trend of pet humanization, where pet parents are willing to spend more on premium pet food and products.
2. Growing market of pet parents in the 26-35 age group who are tech-savvy and comfortable with online shopping.
3. Potential partnerships with pet influencers and veterinarians could boost brand visibility and credibility.

Threats

Sample threats:

1. High competition in the online pet food market, with several established brands.
2. Potential supply chain disruptions could impact the availability of premium ingredients.
3. Regulatory changes that could impact online businesses or pet food standards.

This SWOT analysis can help them in several ways. For example, they might leverage their strengths by collaborating with pet influencers to boost their online presence further and reach their target market more effectively (strength-opportunity strategy). 

They might also consider strategies to make their premium product more affordable or provide more value to cost-conscious customers to overcome their weakness of a higher price point (weakness-opportunity strategy).

Want to know more about how we did market research for this company using ChatGPT? Check out the full blog here.

Now you know how to leverage the SWOT analysis, get to work! 

Top up your SWOT analysis with real-time customer insights. 

SWOT analysis can open up doors to hidden opportunities when done at the right time. It’s like holding up a mirror in your face and looking at yourself (and your surroundings) to introspect yourself and get a clear picture of where you stand – the good, the bad, and the ugly. 

The challenge with SWOT lies in gathering valuable insights and documenting them without bias. Using AI tools like GapScout to gather and analyze real-time insights can help you improve the process of conducting SWOT analysis. So, why not start gathering customer insights right away with Gapscout? 

Also Read:

• How to create a competitive business plan?
• How to identify market opportunities?
• 3 types of customer analysis to drive revenue growth