Agriculture Reference
In-Depth Information
Assessing the fi rm's strengths and weaknesses
A fi nal key part of the SWOT analysis involves understanding what the fi rm does well
(strengths) and areas the fi rm could improve (weaknesses). This evaluation plays an
important role in the market planning process.
First, the marketer may identify a unique strength that can be cultivated into an advan-
tage. Perhaps the fi rm has the most extensive distribution system in the market and therefore
has an advantage in terms of moving product to customers quickly. Second, the fi rm may
identify an area where improvement is needed if a particular customer group is to be served.
An example here might be a retail plant food operation that wants to target larger grain pro-
ducers, yet fi nds its key sales personnel lacking in agronomic expertise. To be successful in
this market the fi rm will need to invest in people and training to enhance the expertise of its
fi eld sales presence. Finally, the fi rm may identify a weakness of such magnitude that it
becomes a constraint on decision-making. A small feed mill may fi nd that it does not have
the scale of operations to serve a very large, integrated pork production operation in its local
market area—and investment in such capacity may not be a prudent business decision.
Like assessing the marketplace, such an internal evaluation typically involves a careful
review of the fi rm's entire operation. Some of the key questions to be asked are shown in
Table 6.2.
Making an objective evaluation can be a challenge. It is easy to be biased when
assessing the fi rm's operation. Securing outside feedback is very important here. Many of
Table 6.2
Assessing internal strengths and weaknesses
Marketing
How effective are our product development activities?
How do our prices compare with the competition?
How much do we spend on advertising and promotion compared to the competition?
Is our social networking strategy driving relationships effectively with our targeted customers?
How satisfi ed are our customers?
How does our sales force compare to the best sales force in our industry?
Finance
How profi table is our organization?
What is our debt position?
Do we use our investment in current assets such as receivables effectively?
How well do we manage cash fl ow during the seasonal swings of our business?
Do we do an effective job of investing in new technology and replacing old assets?
Operations/Logistics
Do we deliver to our customers on time and accurately?
How well do we manage our investment in inventory?
How well do we manage quality through our production process?
What are our transportation costs relative to those of our competitors?
Have we effectively managed the risks in our supply chain—both risks to our employees and risks
to our customers?
Human Resources
How does our training program compare to those of the best fi rms in the market?
Do we have an effective compensation program?
What do our turnover rates look like relative to industry standards?
Do we provide advancement opportunities for employees?
Do we have an effective work environment—do employees enjoy working here?
