business plans strengths and weakness

How to Identify Strengths & Weaknesses in a Business Plan

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How to design an effective business plan, basic dimensions of a marketing plan.

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Writing a strong business plan is easier than you might think because most business plans follow the same basic format. If you are reviewing a plan you've already written or taking a look at one for a friend, knowing how to spot the strengths and weaknesses in the business plan helps you create the most accurate plan.

Look for a Comparative Analysis

When you analyze your competition in a business plan, you should include a comparative analysis, not just a competitive analysis. A competitive analysis looks at your direct competition, while a comparative analysis looks at the indirect competition.

This means a fitness center business plan should include a competitive analysis of other gyms and fitness centers. The plan should also include a comparative analysis of other fitness options people choose instead of going to the gym.

For example, some people don't go to gyms because they jog or play tennis for fitness. A gym business plan should address why people prefer to jog or play tennis (one is solitary, and one is social) and see if they can use those factors to get people to the gym.

Check for a Broad Marketing Approach

Marketing consists of product development, pricing strategies, places of sale and the promotion of a product or service. If a business plan focuses only on the Fourth P of the Four Ps—the marketing mix—it will be weak.

The plan mustn't confine marketing to social media campaigns, advertising, public relations and other promotions. A good business plan should contain separate sections on product development, pricing strategies, distribution channels and promotions.

Anticipate Marketplace Disruption

In addition to analyzing your marketplace as it stands today, your business plan should consider what might happen in the future. You must address new technologies, economic conditions, environmental factors, consumer-buying trends and other factors that might change.

For example, a business plan for a company that makes hard hats for coal miners should address the fact that more and more coal mining is done using machines, not miners, and that environmental laws are making it more difficult for utilities and factories to burn coal. What will that do to the demand for coal miner hard hats in five years?

Reflect Staffing Details

Investors and lenders look at a business plan to see who will be managing the business, according to the U.S. Small Business Administration . If you don't know who will be handling your marketing, IT, sales and other functions, you should at least know what positions your business will have.

A business plan should include an organizational chart that shows the chain of command, who will do what work and who will report to whom. If you can, include job descriptions for the positions you plan to fill.

Analyze Financial Projections

The more you can determine the costs to launch and run your business, the stronger your business plan will be. Budget projections should include not only the cost to make a product but also the expense to run the business and sell the product.

You need to anticipate the overhead you must apply to each unit you sell if you want to know how to price your products to reach specific profits at different sales levels. As sales increase, the overhead cost for each unit decreases, increasing your profit margin. Investors and lenders want to see profit projections using conservative and optimistic forecasts.

Don't forget to include your pre-launch expenses, which have to be paid off during the first year or several, advises Smarty Cents .

• U.S. Small Business Administration: Write Your Business Plan
• Smarty Cents: How to Write a Business Plan the Right Way

Steve Milano is a journalist and business executive/consultant. He has helped dozens of for-profit companies and nonprofits with their marketing and operations. Steve has written more than 8,000 articles during his career, focusing on small business, careers, personal finance and health and fitness. Steve also turned his tennis hobby into a career, coaching, writing, running nonprofits and conducting workshops around the globe.

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SWOT analysis: Examples and templates

A SWOT analysis helps you identify strengths, weaknesses, opportunities, and threats for a specific project or your overall business plan. It’s used for strategic planning and to stay ahead of market trends. Below, we describe each part of the SWOT framework and show you how to conduct your own.

Whether you’re looking for external opportunities or internal strengths, we’ll walk you through how to perform your own SWOT analysis, with helpful examples along the way. 

What is a SWOT analysis?

A SWOT analysis is a technique used to identify strengths, weaknesses, opportunities, and threats for your business or even a specific project. It’s most widely used by organizations—from small businesses and non-profits to large enterprises—but a SWOT analysis can be used for personal purposes as well. 

While simple, a SWOT analysis is a powerful tool for helping you identify competitive opportunities for improvement. It helps you improve your team and business while staying ahead of market trends.

What does SWOT stand for?

SWOT is an acronym that stands for: 

Opportunities

When analyzed together, the SWOT framework can paint a larger picture of where you are and how to get to the next step. Let’s dive a little deeper into each of these terms and how they can help identify areas of improvement. 

Strengths in SWOT refer to internal initiatives that are performing well. Examining these areas helps you understand what’s already working. You can then use the techniques that you know work—your strengths—in other areas that might need additional support, like improving your team’s efficiency . 

When looking into the strengths of your organization, ask yourself the following questions:

What do we do well? Or, even better: What do we do best?

What’s unique about our organization?

What does our target audience like about our organization?

Which categories or features beat out our competitors?

 Example SWOT strength:

Customer service: Our world-class customer service has an NPS score of 90 as compared to our competitors, who average an NPS score of 70.

Weaknesses in SWOT refer to internal initiatives that are underperforming. It’s a good idea to analyze your strengths before your weaknesses in order to create a baseline for success and failure. Identifying internal weaknesses provides a starting point for improving those projects.

Identify the company’s weaknesses by asking:

Which initiatives are underperforming and why?

What can be improved?

What resources could improve our performance?

How do we rank against our competitors?

Example SWOT weakness:

E-commerce visibility: Our website visibility is low because of a lack of marketing budget , leading to a decrease in mobile app transactions.

Opportunities in SWOT result from your existing strengths and weaknesses, along with any external initiatives that will put you in a stronger competitive position. These could be anything from weaknesses that you’d like to improve or areas that weren’t identified in the first two phases of your analysis. 

Since there are multiple ways to come up with opportunities, it’s helpful to consider these questions before getting started:

What resources can we use to improve weaknesses?

Are there market gaps in our services?

What are our business goals for the year?

What do your competitors offer?

Example SWOT opportunities:

Marketing campaign: To improve brand visibility, we’ll run ad campaigns on YouTube, Facebook, and Instagram.

Threats in SWOT are areas with the potential to cause problems. Different from weaknesses, threats are external and ‌out of your control. This can include anything from a global pandemic to a change in the competitive landscape. 

Here are a few questions to ask yourself to identify external threats:

What changes in the industry are cause for concern?

What new market trends are on the horizon?

Where are our competitors outperforming us?

Example SWOT threats:

New competitor: With a new e-commerce competitor set to launch within the next month, we could see a decline in customers.

SWOT analysis example

One of the most popular ways to create a SWOT analysis is through a SWOT matrix—a visual representation of strengths, weaknesses, opportunities, and threats. The matrix comprises four separate squares that create one larger square. 

A SWOT matrix is great for collecting information and documenting the questions and decision-making process . Not only will it be handy to reference later on, but it’s also great for visualizing any patterns that arise. 

Check out the SWOT matrix below for a simple example. As you can see, each of the quadrants lists out the company's strengths, weaknesses, opportunities, and threats.

When used correctly and effectively, your matrix can be a great toolkit for evaluating your organization’s strengths and weaknesses. 

How to do a SWOT analysis, with examples 

A SWOT analysis can be conducted in a variety of ways. Some teams like to meet and throw ideas on a whiteboard, while others prefer the structure of a SWOT matrix. However you choose to make your SWOT analysis, getting creative with your planning process allows new ideas to flow and results in more unique solutions. 

There are a few ways to ensure that your SWOT analysis is thorough and done correctly. Let’s take a closer look at some tips to help you get started.

Tip 1: Consider internal factors 

Often, strengths and weaknesses stem from internal processes. These tend to be easier to solve since you have more control over the outcome. When you come across internal factors, you can start implementing improvements in a couple of different ways.

Meet with department stakeholders to form a business plan around how to improve your current situation.

Research and implement new tools, such as a project management tool , that can help streamline these processes for you. 

Take immediate action on anything that can be changed in 24 hours or less. If you don’t have the capacity, consider delegating these items to others with deadlines. 

The way you go about solving internal factors will depend on the type of problem. If it’s more complex, you might need to use a combination of the above or a more thorough problem management process.

Tip 2: Evaluate external factors

External factors stem from processes outside of your control. This includes competitors, market trends, and anything else that’s affecting your organization from the outside in. 

External factors are trickier to solve, as you can’t directly control the outcome. What you can do is pivot your own processes in a way that mitigates negative external factors. 

You can work to solve these issues by:

Competing with market trends

Forecasting market trends before they happen

Improving adaptability to improve your reaction time

Track competitors using reporting tools that automatically update you as soon as changes occur 

While you won’t be able to control an external environment, you can control how your organization reacts to it. 

Let’s say, for instance, that you’re looking to compete with a market trend. For example, a competitor introduced a new product to the market that’s outperforming your own. While you can’t take that product away, you can work to launch an even better product or marketing campaign to mitigate any decline in sales. 

Tip 3: Hold a brainstorming session

Brainstorming new and innovative ideas can help to spur creativity and inspire action. To host a high impact brainstorming session, you’ll want to: 

Invite team members from various departments. That way, ideas from each part of the company are represented. 

Be intentional about the number of team members you invite, since too many participants could lead to a lack of focus or participation. The sweet spot for a productive brainstorming session is around 10 teammates. 

Use different brainstorming techniques that appeal to different work types.

Set a clear intention for the session.

Tip 4: Get creative

In order to generate creative ideas, you have to first invite them. That means creating fun ways to come up with opportunities. Try randomly selecting anonymous ideas, talking through obviously bad examples, or playing team building games to psych up the team.

Tip 5: Prioritize opportunities

Now, rank the opportunities. This can be done as a team or with a smaller group of leaders. Talk through each idea and rank it on a scale of one through 10. Once you’ve agreed on your top ideas based on team capabilities, competencies, and overall impact, it’s easier to implement them.

Tip 6: Take action

It’s all too easy to feel finished at this stage —but the actual work is just beginning. After your SWOT analysis, you’ll have a list of prioritized opportunities. Now is the time to turn them into strengths. Use a structured system such as a business case , project plan, or implementation plan to outline what needs to get done—and how you plan to do it.

SWOT analysis template

A SWOT analysis template is often presented in a grid format, divided into four quadrants. Each quadrant represents one of the four elements. 

Use this free SWOT analysis template to jump-start your team’s strategic planning.

Identify the strengths that contribute to achieving your objectives. These are internal characteristics that give you an advantage. Some examples could be a strong brand reputation, an innovative culture, or an experienced management team.

Next, focus on weaknesses. These are internal factors that could serve as obstacles to achieving your objectives. Common examples might include a lack of financial resources, high operational costs, or outdated technology. 

Move on to the opportunities. These are external conditions that could be helpful in achieving your goals. For example, you might be looking at emerging markets, increased demand, or favorable shifts in regulations.

Lastly, let's address threats. These are external conditions that could negatively impact your objectives. Examples include increased competition or potential economic downturns.

Why is a SWOT analysis important?

A SWOT analysis can help you improve processes and plan for growth. While similar to a competitive analysis , it differs because it evaluates both internal and external factors. Analyzing key areas around these opportunities and threats will equip you with the insights needed to set your team up for success.

A SWOT analysis isn’t only useful for organizations. With a personal SWOT analysis, you can examine areas of your life that could benefit from improvement, from your leadership style to your communication skills. These are the benefits of using a SWOT analysis in any scenario. 

1. Identifies areas of opportunity

One of the biggest benefits of conducting an analysis is to determine opportunities for growth. It’s a great starting point for startups and teams that know they want to improve but aren’t exactly sure how to get started. 

Opportunities can come from many different avenues, like external factors such as diversifying your products for competitive advantage or internal factors like improving your team’s workflow . Either way, capitalizing on opportunities is an excellent way to grow as a team.

2. Identifies areas that could be improved

Identifying weaknesses and threats during a SWOT analysis can pave the way for a better business strategy.

Ultimately, learning from your mistakes is the best way to excel. Once you find areas to streamline, you can work with team members to brainstorm an action plan . This will let you use what you already know works and build on your company’s strengths.

3. Identifies areas that could be at risk

Whether you have a risk register in place or not, it’s always crucial to identify risks before they become a cause for concern. A SWOT analysis can help you stay on top of actionable items that may play a part in your risk decision-making process. 

It may be beneficial to pair your SWOT analysis with a PEST analysis, which examines external solutions such as political, economic, social, and technological factors—all of which can help you identify and plan for project risks .

When should you use a SWOT analysis?

You won’t always need an in-depth SWOT analysis. It’s most useful for large, general overviews of situations, scenarios, or your business.

A SWOT analysis is most helpful:

Before you implement a large change—including as part of a larger change management plan

When you launch a new company initiative

If you’d like to identify opportunities for growth and improvement

Any time you want a full overview of your business performance

If you need to identify business performance from different perspectives

SWOT analyses are general for a reason—so they can be applied to almost any scenario, project, or business. 

SWOT analysis: Pros and cons

Although SWOT is a useful strategic planning tool for businesses and individuals alike, it does have limitations. Here’s what you can expect.

The simplicity of SWOT analysis makes it a go-to tool for many. Because it is simple, it takes the mystery out of strategic planning and lets people think critically about their situations without feeling overwhelmed. 

For instance, a small bakery looking to expand its operations can use SWOT analysis to easily understand its current standing. Identifying strengths like a loyal customer base, weaknesses such as limited seating space, opportunities like a rising trend in artisanal baked goods, and threats from larger chain bakeries nearby can all be accomplished without any specialized knowledge or technical expertise.

Versatility

Its versatile nature allows SWOT analysis to be used across various domains. Whether it’s a business strategizing for the future or an individual planning their career path, SWOT analysis lends itself well. 

For example, a tech start-up in the competitive Silicon Valley landscape could employ SWOT to navigate its pathway to profitability. Strengths might include a highly skilled development team; weaknesses could be a lack of brand recognition; opportunities might lie in emerging markets; and threats could include established tech giants. 

Meaningful analysis

SWOT excels in identifying external factors that could impact performance. It nudges organizations to look beyond the present and anticipate potential future scenarios. 

A retail company, for example, could use SWOT analysis to identify opportunities in e-commerce and threats from changing consumer behavior or new competitors entering the market. By doing so, the company can strategize on how to leverage online platforms to boost sales and counteract threats by enhancing the customer experience or adopting new technologies.

Subjectivity and bias

The subjective nature of SWOT analysis may lead to biases. It relies heavily on individual perceptions, which can sometimes overlook crucial data or misinterpret information, leading to skewed conclusions. 

For example, a manufacturing company might undervalue the threat of new entrants in the market due to an overconfidence bias among the management. This subjectivity might lead to a lack of preparation for competitive pricing strategies, ultimately affecting the company's market share.

Lack of prioritization

SWOT analysis lays out issues but falls short on prioritizing them. Organizations might struggle to identify which elements deserve immediate attention and resources. 

For instance, a healthcare provider identifying numerous opportunities for expansion into new services may become overwhelmed with the choices. Without a clear way to rank these opportunities, resources could be spread too thinly or given to projects that do not have as much of an impact, leading to less-than-ideal outcomes.

Static analysis

Since SWOT analysis captures a snapshot at a particular moment, it may miss the evolving nature of challenges and opportunities, possibly leading to outdated strategies. An example could be a traditional retail business that performs a SWOT analysis and decides to focus on expanding physical stores, overlooking the growing trend of e-commerce. As online shopping continues to evolve and gain popularity, the static analysis might lead to investment in areas with diminishing returns while missing out on the booming e-commerce market trend.

SWOT analysis FAQ

What are the five elements of swot analysis.

Traditionally, SWOT stands for its four main elements: strengths, weaknesses, opportunities, and threats. However, a fifth essential element often overlooked is "actionable strategies." Originally developed by Albert Humphrey, SWOT is more than just a list—it's a planning tool designed to generate actionable strategies for making informed business decisions. This fifth element serves to tie the other four together, enabling departments like human resources and marketing to turn analysis into actionable plans.

What should a SWOT analysis include?

A comprehensive SWOT analysis should focus on the internal and external factors that affect your organization. Internally, consider your strong brand and product line as your strengths, and maybe your supply chain weaknesses. Externally, you'll want to look at market share, partnerships, and new technologies that could either pose opportunities or threats. You should also account for demographics, as it helps in market targeting and segmentation.

How do you write a good SWOT analysis?

Writing an effective SWOT analysis begins with research. Start by identifying your strengths, like a strong brand, and your weaknesses, like a small human resources department. Following that, look outward to find opportunities, possibly in technological advancement, and threats, like fluctuations in market share. Many businesses find it helpful to use a free SWOT analysis template to structure this information. A good SWOT analysis doesn't just list these elements; it integrates them to provide a clear roadmap for making business decisions.

What are four examples of threats in SWOT analysis?

New technologies: Rapid technological advancement can make your product or service obsolete.

Supply chain disruptions: Whether due to natural disasters or geopolitical tensions, an unstable supply chain can seriously jeopardize your operations.

Emerging competitors: New players entering the market can erode your market share and offer alternative solutions to your customer base.

Regulatory changes: New laws or regulations can add costs and complexity to your business, affecting your competitiveness.

How do you use a SWOT analysis?

Once you've completed a SWOT analysis, use the results as a decision-making aid. It can help prioritize actions, develop strategic plans that play to your strengths, improve weaknesses, seize opportunities, and counteract threats. It’s a useful tool for setting objectives and creating a roadmap for achieving them.

Plan for growth with a SWOT analysis

A SWOT analysis can be an effective technique for identifying key strengths, weaknesses, opportunities, and threats. Understanding where you are now can be the most impactful way to determine where you want to go next. 

Don’t forget, a bit of creativity and collaboration can go a long way. Encourage your team to think outside of the box with 100+ team motivational quotes .

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SWOT Analysis: How To Do One [With Template & Examples]

Published: October 05, 2023

As your business grows, you need a roadmap to help navigate the obstacles, challenges, opportunities, and projects that come your way. Enter: the SWOT analysis.

This framework can help you develop a plan to determine your priorities, maximize opportunities, and minimize roadblocks as you scale your organization. Below, let’s go over exactly what a SWOT analysis is, a few SWOT analysis examples, and how to conduct one for your business.

When you’re done reading, you’ll have all the inspiration and tactical advice you need to tackle a SWOT analysis for your business.

What is a SWOT analysis? Importance of a SWOT Analysis How to Write a Good SWOT Analysis SWOT Analysis Examples How to Act on a SWOT Analysis

What is a SWOT analysis?

A SWOT analysis is a strategic planning technique that puts your business in perspective using the following lenses: Strengths, Weaknesses, Opportunities, and Threats. Using a SWOT analysis helps you identify ways your business can improve and maximize opportunities, while simultaneously determining negative factors that might hinder your chances of success.

While it may seem simple on the surface, a SWOT analysis allows you to make unbiased evaluations on:

• Your business or brand.
• Market positioning.
• A new project or initiative.
• A specific campaign or channel.

Practically anything that requires strategic planning, internal or external, can have the SWOT framework applied to it, helping you avoid unnecessary errors down the road from lack of insight.

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Importance of a SWOT Analysis

You’ve noticed by now that SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. The framework seems simple enough that you’d be tempted to forgo using it at all, relying instead on your intuition to take these things into account.

But you shouldn’t. Doing a SWOT analysis is important. Here’s why.

SWOT gives you the chance to worry and to dream.

A SWOT analysis is an important step in your strategic process because it gives you the opportunity to explore both the potential risks and the exciting possibilities that lie ahead.  You’re giving yourself the space to dream, evaluate, and worry before taking action. Your insights then turn into assets as you create the roadmap for your initiative.

For instance, when you consider the weaknesses and threats that your business may face, you can address any concerns or challenges and strategize on how to mitigate those risks. At the same time, you can identify strengths and opportunities, which can inspire innovative ideas and help you dream big. Both are equally important. 

SWOT forces you to define your variables.

Instead of diving head first into planning and execution, you’re taking inventory of all your assets and roadblocks. This process will help you  develop strategies that leverage your strengths and opportunities while addressing and mitigating the impact of weaknesses and threats.

As a result, you'll gain a comprehensive understanding of your current situation and create a more specific and effective roadmap. Plus, a SWOT analysis is inherently proactive. That means you'll be better equipped to make informed decisions, allocate resources effectively, and set realistic goals. 

SWOT allows you to account for mitigating factors.

As you identify weaknesses and threats, you’re better able to account for them in your roadmap, improving your chances of success.

Moreover, accounting for mitigating factors allows you to allocate your resources wisely and make informed decisions that lead to sustainable growth. With a SWOT analysis as a guide, you can confidently face challenges and seize opportunities.

SWOT helps you keep a written record.

As your organization grows and changes, you’ll be able to strike things off your old SWOTs and make additions. You can look back at where you came from and look ahead at what’s to come.

In other words, SWOT analyses serve as a tangible history of your progress and provide a reference point for future decision-making. With each update, your SWOT analysis becomes a living document that guides your strategic thinking and helps you stay agile and adaptable in an ever-changing business landscape.

By maintaining this written record, you foster a culture of continuous improvement and empower your team to make data-driven decisions and stay aligned with your long-term vision.

Parts of a SWOT Analysis

Conducting a SWOT analysis will help you strategize effectively, unlock valuable insights, and make informed decisions. But what exactly does a SWOT analysis include?

Let’s explore each component: Strengths, Weaknesses, Opportunities, and Threats.

Your strengths are the unique advantages and internal capabilities that give your company a competitive edge in the market. A strong brand reputation, innovative products or services, or exceptional customer service are just a few examples. By identifying and capitalizing on your strengths, you can foster customer loyalty and build a solid foundation for growth.

No business is flawless. Weaknesses are areas where you may face challenges or fall short of your potential. It could be outdated processes, skill gaps within the team, or inadequate resources. By acknowledging these weaknesses, you can establish targeted initiatives for improvement, upskill your team, adopt new technologies, and enhance your overall operational efficiency.

Opportunities are external factors that can contribute to your company's progress. These may include emerging markets, technological advancements, changes in consumer behavior, or gaps in the market that your company can fill. By seizing these opportunities, you can expand your market reach, diversify your product offerings, forge strategic partnerships, or even venture into untapped territories.

Threats are external factors that are beyond your control and pose challenges to your business. Increased competition, economic volatility, evolving regulatory landscapes, or even changing market trends are examples of threats. By proactively assessing and addressing them, you can develop contingency plans, adjust your strategies, and minimize their impact on your operations.

In a SWOT analysis, you’ll have to take both internal and external factors into account. We’ll cover those next.

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SWOT Analysis Internal and External Factors

A SWOT analysis typically has internal (i.e., within your organization) and external (i.e., outside your organization) factors at play. Here's a breakdown of each.

Internal Factors

Internal factors refer to the characteristics and resources within your organization that directly influence its operations and performance. These factors are completely within your organization's control, so they can be modified, improved, or capitalized upon.

In a SWOT analysis, strengths and weaknesses are categorized as internal factors. Let’s look at a few examples.

• Brand reputation
• Unique expertise
• Loyal customer base
• Talented workforce
• Efficient processes
• Proprietary technology
• Outdated technology
• Inadequate resources
• Poor financial health
• Inefficient processes
• Skill gaps within the team

External Factors

External factors are elements outside the organization's control that have an impact on its operations, market position, and success. These factors arise from the industry climate and the broader business environment. You typically have no control over external factors, but you can respond to them.

In a SWOT analysis, opportunities and threats are categorized as external factors. Let’s look at a few examples.

• Emerging markets
• Changing consumer trends
• Technological advancements
• Positive shifts in regulations
• New gaps in the market you could fill
• Intense competition
• Economic downturns
• Disruptive technologies
• Changing regulations
• Negative shifts in consumer behavior

Remember, a well-rounded SWOT analysis empowers you to capitalize on strengths, address weaknesses, seize opportunities, and navigate threats — all while making informed decisions for the future.

Now, let’s take a look at how you can write a good SWOT analysis for yourself or for stakeholders.

How do you write a good SWOT analysis?

There are several steps you’ll want to take when evaluating your business and conducting a strategic SWOT analysis.

1. Download HubSpot's SWOT Analysis Template.

There’s no need to start from scratch for your analysis. Instead, start by downloading a free, editable template from HubSpot. Feel free to use the model yourself, or create your own as it suits your needs.

3. Identify your objective.

Before you start writing things down, you’ll need to figure out what you’re evaluating with your SWOT analysis.

Be specific about what you want to analyze. Otherwise, your SWOT analysis may end up being too broad, and you’ll get analysis paralysis as you are making your evaluations.

If you’re creating a new social media program, you’ll want to conduct an analysis to inform your content creation strategy. If you’re launching a new product, you’ll want to understand its potential positioning in the space. If you’re considering a brand redesign, you’ll want to consider existing and future brand conceptions.

All of these are examples of good reasons to conduct a SWOT analysis. By identifying your objective, you’ll be able to tailor your evaluation to get more actionable insights.

4. Identify your strengths.

“Strengths” refers to what you are currently doing well. Think about the factors that are going in your favor as well as the things you offer that your competitors just can’t beat.

For example, let’s say you want to use a SWOT analysis to evaluate your new social media strategy.

If you’re looking at a new social media program, perhaps you want to evaluate how your brand is perceived by the public. Is it easily recognizable and well-known? Even if it’s not popular with a widespread group, is it well-received by a specific audience?

Next, think about your process: Is it effective or innovative? Is there good communication between marketing and sales?

Finally, evaluate your social media message, and in particular, how it differs from the rest of the industry. I’m willing to bet you can make a lengthy list of some major strengths of your social media strategy over your competitors, so try to dive into your strengths from there.

5. Identify your weaknesses.

In contrast to your strengths, what are the roadblocks hindering you from reaching your goals? What do your competitors offer that continues to be a thorn in your side?

This section isn’t about dwelling on negative aspects. Rather, it’s critical to foresee any potential obstacles that could mitigate your success.

When identifying weaknesses, consider what areas of your business are the least profitable, where you lack certain resources, or what costs you the most time and money. Take input from employees in different departments, as they’ll likely see weaknesses you hadn’t considered.

If you’re examining a new social media strategy, you might start by asking yourself these questions: First, if I were a consumer, what would prevent me from buying this product, or engaging with this business? What would make me click away from the screen?

Second, what do I foresee as the biggest hindrance to my employees’ productivity, or their ability to get the job done efficiently? What derails their social media efforts?

6. Consider your opportunities.

This is your chance to dream big. What are some opportunities for your social media strategy you hope, but don’t necessarily expect, to reach?

For instance, maybe you’re hoping your Facebook ads will attract a new, larger demographic. Maybe you’re hoping your YouTube video gets 10,000 views and increases sales by 10%.

Whatever the case, it’s important to include potential opportunities in your SWOT analysis. Ask yourself these questions:

• What technologies do I want my business to use to make it more effective?
• What new target audience do I want to reach?
• How can the business stand out more in the current industry?
• Is there something our customers complain about that we could fix?

The opportunities category goes hand-in-hand with the weaknesses category. Once you’ve made a list of weaknesses, it should be easy to create a list of potential opportunities that could arise if you eliminate your weaknesses.

7. Contemplate your threats.

It’s likely, especially if you’re prone to worry, you already have a good list of threats in your head.

If not, gather your employees and brainstorm. Start with these questions:

• What obstacles might prevent us from reaching our goals?
• What’s going on in the industry, or with our competitors, that might mitigate our success?
• Is there new technology out there that could conflict with our product?

Writing down your threats helps you evaluate them objectively.

For instance, maybe you list your threats in terms of least and most likely to occur and divide and conquer each. If one of your biggest threats is your competitor’s popular Instagram account, you could work with your marketing department to create content that showcases your product’s unique features.

SWOT Analysis Chart

Download a free SWOT analysis chart included in HubSpot’s free market research kit .

A SWOT analysis doesn’t have to be fancy. Our SWOT analysis chart provides a clear and structured framework for capturing and organizing your internal strengths and weaknesses, and external opportunities and threats. It's the perfect visual aid to make sense of the wealth of information gathered during your analysis.

(Plus, you can always customize and paste it into a document you plan to share with stakeholders.)

But remember: Filling out the SWOT chart is just one step in the process. Combine it with our entire market research kit , and you'll have all the tools necessary to help your organization navigate new opportunities and threats.

SWOT Analysis Examples

The template above helps get you started on your own SWOT analysis.

But, if you’re anything like me, it’s not enough to see a template. To fully understand a concept, you need to see how it plays out in the real world.

These SWOT examples are not exhaustive. However, they are a great starting point to inspire you as you do your own SWOT analysis.

Apple’s SWOT analysis

Here’s how we’d conduct a SWOT analysis on Apple.

First off, strengths. While Apple has many strengths, let’s identify the top three:

• Brand recognition.
• Innovative products.
• Ease of use.

Apple’s brand is undeniably strong, and its business is considered the most valuable in the world . Since it’s easily recognized, Apple can produce new products and almost ensure a certain degree of success by virtue of the brand name itself.

Apple’s highly innovative products are often at the forefront of the industry. One thing that sets Apple apart from the competition is its product inter-connectivity.

For instance, an Apple user can easily sync their iPhone and iPad together. They can access all of their photos, contacts, apps, and more no matter which device they are using.

Lastly, customers enjoy how easy it is to use Apple’s products. With a sleek and simple design, each product is developed so that most people can quickly learn how to use them.

Next, let’s look at three of Apple’s weaknesses.

• High prices
• Closed ecosystem
• Lack of experimentation

While the high prices don’t deter Apple’s middle- and upper-class customer base, they do hinder Apple’s ability to reach a lower-class demographic.

Apple also suffers from its own exclusivity. Apple controls all its services and products in-house, and while many customers become loyal brand advocates for this reason, it means all burdens fall on Apple employees.

Ultimately, Apple’s tight control over who distributes its products limits its market reach.

Lastly, Apple is held to a high standard when it comes to creating and distributing products. Apple’s brand carries a high level of prestige. That level of recognition inhibits Apple from taking risks and experimenting freely with new products that could fail.

Now, let’s take a look at opportunities for Apple.

It’s easy to recognize opportunities for improvement, once you consider Apple’s weaknesses. Here’s a list of three we came up with:

• Expand distribution options.
• Create new product lines.
• Technological advancement.

One of Apple’s biggest weaknesses is its distribution network, which, in the name of exclusivity, remains relatively small. If Apple expanded its network and enabled third-party businesses to sell its products, it could reach more people globally, while alleviating some of the stress currently put on in-house employees.

There are also plenty of opportunities for Apple to create new products. Apple could consider creating more affordable products to reach a larger demographic, or spreading out into new industries — Apple self-driving cars, perhaps?

Finally, Apple could continue advancing its products’ technology. Apple can take existing products and refine them, ensuring each product offers as many unique features as possible.

Finally, let’s look at threats to Apple.

Believe it or not, they do exist.

Here are three of Apple’s biggest threats:

• Tough competition.
• International issues.

Apple isn’t the only innovative tech company out there, and it continues to face tough competition from Samsung, Google, and other major forces. In fact, Samsung sold more smartphones than Apple did in Q1 of 2022 , shipping 17 million more units than Apple and holding 24% of the market share.

Many of Apple’s weaknesses hinder Apple’s ability to compete with the tech corporations that have more freedom to experiment, or that don’t operate in a closed ecosystem.

A second threat to Apple is lawsuits. Apple has faced plenty of lawsuits, particularly between Apple and Samsung . These lawsuits interfere with Apple’s reputable image and could steer some customers to purchase elsewhere.

Finally, Apple needs to improve its reach internationally. The company isn’t number one in China and doesn’t have a very positive relationship with the Chinese government. In India, which has one of the largest consumer markets in the world, Apple’s market share is low , and the company has trouble bringing stores to India’s market.

If Apple can’t compete globally the way Samsung or Google can, it risks falling behind in the industry.

Starbucks SWOT Analysis

Now that we’ve explored the nuances involved with a SWOT analysis, let’s fill out a SWOT template using Starbucks as an example.

Here’s how we’d fill out a SWOT template if we were Starbucks:

Download this Template for Free

Restaurant Small Business SWOT Analysis

Some small business marketers may have difficulty relating to the SWOTs of big brands like Apple and Starbucks. Here’s an example of how a dine-in Thai restaurant might visualize each element.

Small restaurants can lean into their culinary expertise and service skills to find opportunities for growth and brand awareness. A SWOT analysis can also help identify weaknesses that can be improved, such as menu variation and pricing.

While a restaurant might not be as worried about high-level lawsuits, a small business might be more concerned about competitors or disruptors that might enter the playing field.

Local Boutique SWOT Analysis

In another small business example, let’s take a look at a SWOT analysis for a local boutique.

This shop might be well known in its neighborhood, but it also might take time to build an online presence or get its products in an online store.

Because of this, some of its strengths and opportunities might relate to physical factors while weaknesses and threats might relate to online situations.

How to Act on a SWOT Analysis

After conducting a SWOT analysis, you may be asking yourself: What’s next?

Putting together a SWOT analysis is only one step. Executing the findings identified by the analysis is just as important — if not more.

Put your insights into action using the following steps.

Take advantage of your strengths.

Use your strengths to pursue opportunities from your analysis.

For example, if we look at the local boutique example above, the strength of having affordable prices can be a value proposition. You can emphasize your affordable prices on social media or launch an online store.

Address your weaknesses.

Back to the boutique example, one of its weaknesses is having a poor social media presence. To mitigate this, the boutique could hire a social media consultant to improve its strategy. They may even tap into the expertise of a social-savvy employee.

Make note of the threats.

Threats are often external factors that can’t be controlled, so it’s best to monitor the threats outlined in your SWOT analysis to be aware of their impacts on your business.

When to Use a SWOT Analysis

While the examples above focus on business strategy in general, you can also use a SWOT analysis to evaluate and predict how a singular product will play out in the market.

Ultimately, a SWOT analysis can measure and tackle both big and small challenges, from deciding whether or not to launch a new product to refining your social media strategy.

Editor's note: This post was originally published in May 2018 and has been updated for comprehensiveness.

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How to Identify Strengths & Weaknesses in a Business Plan

by Brian Hill

Published on 1 Jan 2021

In a business plan, the discussion of a company's strengths and weaknesses is often included in a section known as SWOT -- strengths, weaknesses, opportunities and threats. Strengths are what the company does particularly well. It could be offering superior products or being particularly efficient in manufacturing. Weaknesses are things that keep the company from achieving the revenue growth or profitability the business owner seeks. Small businesses often find that one of their weaknesses is a lack of financial resources.

Compare the Company to the Ideal

One of the first steps in creating a business plan is establishing a long-range vision for the company -- how the owner sees the company growing and becoming more profitable in the future. He creates his own picture of what the company will look like if everything goes as well as planned. This ideal future version of his company will undoubtedly being doing some things much better than the current company is. He evaluates what current weaknesses need to be addressed that are roadblocks to reaching his ideal future.

Compare the Company to Major Competitors

A small business owner must know his competitors' strengths and weaknesses in addition to those of his own company. Including a side-by-side comparison of these strengths and weaknesses in his business plan gives the owner a good idea of how to build competitive advantage -- he markets to his strengths and tries to avoid competing head-on with competitors where they are strongest or where his company may be weak.

Review Actual Financial Results

The company's strengths and weaknesses show up in the financial results -- its profit and loss statement. The business owner should produce a financial report that compares actual results to the forecast numbers in the business plan. Each month, or at least each quarter, he should analyze the largest categories of revenues and expenses, and determine the reason for any variances, whether positive or negative. If profits continue to rise because gross margin percentages are increasing, he knows that production efficiency is becoming one of the company's strengths. Continued revenue shortfalls are an indication that the company's marketing strategy is not working; it is a weakness that requires the business owner's immediate attention.

Compare Performance to Industry Averages

Many industries have trade associations that survey members and publish statistics about how, on average, companies in the industry are performing. If the business owner sees that his own statistics vary significantly from industry averages, such as in gross margin percentage or profit as a percentage of sales, he can get a good idea of his company's relative strengths and weaknesses. If a company spends a much higher percentage on personnel costs than industry averages, the owner could conclude that employee productivity is one of the company's weaknesses. He would devise strategies and tactics to address this issue in the business plan.

Solicit Advice From All Team Members

A company may have hidden strengths that the owner is unaware of -- things that could be developed into opportunities to increase revenue. A business owner may also be unaware of things that are seen as weaknesses by the company's customers. Employees who come into close contact with customers every day would be aware of those weaknesses. Asking employees for input during the planning process is essential to having an accurate depiction of the company's current position, including its strengths and weaknesses, and that awareness forms the basis of a sound plan for the future.

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What Is a SWOT Analysis and How to Do It Right (With Examples)

Posted february 2, 2021 by noah parsons.

A SWOT analysis is an incredibly simple, yet powerful tool to help you develop your business strategy, whether you’re building a startup or guiding an existing company.

What is a SWOT Analysis?

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats.

Strengths and weaknesses are internal to your company—things that you have some control over and can change. Examples include who is on your team, your patents and intellectual property, and your location.

Opportunities and threats are external—things that are going on outside your company, in the larger market. You can take advantage of opportunities and protect against threats, but you can’t change them. Examples include competitors, prices of raw materials, and customer shopping trends.

A SWOT analysis organizes your top strengths, weaknesses, opportunities, and threats into an organized list and is usually presented in a simple two-by-two grid. Go ahead and download our free template if you just want to dive right in and get started.

Why do a SWOT Analysis?

When you take the time to do a SWOT analysis, you’ll be armed with a solid strategy for prioritizing the work that you need to do to grow your business.

You may think that you already know everything that you need to do to succeed, but a SWOT analysis will force you to look at your business in new ways and from new directions. You’ll look at your strengths and weaknesses, and how you can leverage those to take advantage of the opportunities and threats that exist in your market.

Who should do a SWOT Analysis?

For a SWOT analysis to be effective, company founders and leaders need to be deeply involved. This isn’t a task that can be delegated to others.

But, company leadership shouldn’t do the work on their own , either. For best results, you’ll want to gather a group of people who have different perspectives on the company. Select people who can represent different aspects of your company, from sales and customer service to marketing and product development. Everyone should have a seat at the table.

Innovative companies even look outside their own internal ranks when they perform a SWOT analysis and get input from customers to add their unique voice to the mix.

If you’re starting or running a business on your own, you can still do a SWOT analysis. Recruit additional points of view from friends who know a little about your business, your accountant, or even vendors and suppliers. The key is to have different points of view.

Existing businesses can use a SWOT analysis to assess their current situation and determine a strategy to move forward . But, remember that things are constantly changing and you’ll want to reassess your strategy, starting with a new SWOT analysis every six to 12 months.

For startups, a SWOT analysis is part of the business planning process. It’ll help codify a strategy so that you start off on the right foot and know the direction that you plan to go.

How to do a SWOT analysis the right way

As I mentioned above, you want to gather a team of people together to work on a SWOT analysis. You don’t need an all-day retreat to get it done, though. One or two hours should be more than plenty.

1. Gather the right people

Gather people from different parts of your company and make sure that you have representatives from every department and team. You’ll find that different groups within your company will have entirely different perspectives that will be critical to making your SWOT analysis successful.

2. Throw your ideas at the wall

Doing a SWOT analysis is similar to brainstorming meetings, and there are right and wrong ways to run them. I suggest giving everyone a pad of sticky-notes and have everyone quietly generate ideas on their own to start things off. This prevents groupthink and ensures that all voices are heard.

After five to 10 minutes of private brainstorming, put all the sticky-notes up on the wall and group similar ideas together. Allow anyone to add additional notes at this point if someone else’s idea sparks a new thought.

3. Rank the ideas

Once all of the ideas are organized, it’s time to rank the ideas. I like using a voting system where everyone gets five or ten “votes” that they can distribute in any way they like. Sticky dots in different colors are useful for this portion of the exercise.

Based on the voting exercise, you should have a prioritized list of ideas. Of course, the list is now up for discussion and debate, and someone in the room should be able to make the final call on the priority. This is usually the CEO, but it could be delegated to someone else in charge of business strategy.

You’ll want to follow this process of generating ideas for each of the four quadrants of your SWOT analysis: Strengths, Weaknesses, Opportunities, and Threats.

Questions that can help inspire your analysis

Here are a few questions that you can ask your team when you’re building your SWOT analysis. These questions can help explain each section and spark creative thinking.

Strengths are internal, positive attributes of your company. These are things that are within your control.

• What business processes are successful?
• What assets do you have in your teams? (ie. knowledge, education, network, skills, and reputation)
• What physical assets do you have, such as customers, equipment, technology, cash, and patents?
• What competitive advantages do you have over your competition?

Weaknesses are negative factors that detract from your strengths. These are things that you might need to improve on to be competitive.

• Are there things that your business needs to be competitive?
• What business processes need improvement?
• Are there tangible assets that your company needs, such as money or equipment?
• Are there gaps on your team?
• Is your location ideal for your success?

Opportunities

Opportunities are external factors in your business environment that are likely to contribute to your success.

• Is your market growing and are there trends that will encourage people to buy more of what you are selling?
• Are there upcoming events that your company may be able to take advantage of to grow the business?
• Are there upcoming changes to regulations that might impact your company positively?
• If your business is up and running, do customers think highly of you?

Threats are external factors that you have no control over. You may want to consider putting in place contingency plans for dealing with them if they occur.

• Do you have potential competitors who may enter your market?
• Will suppliers always be able to supply the raw materials you need at the prices you need?
• Could future developments in technology change how you do business?
• Is consumer behavior changing in a way that could negatively impact your business?
• Are there market trend s that could become a threat?

SWOT Analysis example

To help you get a better sense of what at SWOT example actually looks like, we’re going to look at UPer Crust Pies, a specialty meat and fruit pie cafe in Michigan’s Upper Peninsula. They sell hot, ready-to-go pies and frozen take-home options, as well as an assortment of fresh salads and beverages.

The company is planning to open its first location in downtown Yubetchatown and is very focused on developing a business model that will make it easy to expand quickly and that opens up the possibility of franchising. Here’s what their SWOT analysis might look like:

SWOT analysis for UPer Crust Pies

How to use your SWOT Analysis

With your SWOT analysis complete, you’re ready to convert it into a real strategy. After all, the exercise is about producing a strategy that you can work on during the next few months.

The first step is to look at your strengths and figure out how you can use those strengths to take advantage of your opportunities. Then, look at how your strengths can combat the threats that are in the market . Use this analysis to produce a list of actions that you can take.

With your action list in hand, look at your company calendar and start placing goals (or milestones) on it. What do you want to accomplish in each calendar quarter (or month) moving forward?

You’ll also want to do this by analyzing how external opportunities might help you combat your own, internal weaknesses. Can you also minimize those weaknesses so you can avoid the threats that you identified?

Again, you’ll have an action list that you’ll want to prioritize and schedule.

UPer Crust Pies — Potential strategies for growth

Back to the UPer Crust Pies example: Based on their SWOT analysis, here are a few potential strategies for growth to help you think through how to translate your SWOT into actionable goals.

• Investigate investors. UPer Crust Pies might investigate its options for obtaining capital.
• Create a marketing plan. Because UPer Crust Pies wants to execute a specific marketing strategy—targeting working families by emphasizing that their dinner option is both healthy and convenient—the company should develop a marketing plan.
• Plan a grand opening. A key piece of that marketing plan will be the store’s grand opening, and the promotional strategies necessary to get UPer Crust Pies’ target market in the door.

Next steps with your SWOT Analysis

With your goals and actions in hand, you’ll be a long way toward completing a strategic plan for your business. I like to use the Lean Planning methodology for strategic plans as well as regular business planning. The actions that you generate from your SWOT analysis will fit right into the milestones portion of your Lean Plan and will give you a concrete foundation that you can grow your business from. You can download our free Lean Plan template to help you get started.

If you have additional ideas for how a SWOT analysis can help your business and how it fits into your regular business planning, I’d love to hear from you. You can find me on Twitter @noahparsons .

Editor’s note: This article was originally published in 2018 and updated for 2021.

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How to Write a SWOT Analysis for a Business Plan

• March 21, 2024
• Business Plan , How to Write

Navigating the complexities of business requires a clear understanding of your strategic position, and a SWOT analysis is an essential tool to help you achieve this clarity. It’s a straightforward method that breaks down into Strengths, Weaknesses, Opportunities, and Threats, providing a snapshot of where your business stands and guiding your future strategic moves.

With this guide, you’ll learn how to leverage your advantages, address challenges, seize new opportunities, and guard against potential threats. Let’s dive into the process together and set a strong foundation for your business’s strategic planning. Let’s dive in!

What is a SWOT Analysis?

A SWOT analysis is a strategic planning tool used to identify and understand the Strengths, Weaknesses, Opportunities, and Threats related to business competition or project planning. This method helps organizations in assessing both internal and external factors that could impact their objectives.

• Strengths : Positive attributes internal to the organization and within its control. Strengths are resources and capabilities that can be used as a basis for developing a competitive advantage.
• Weaknesses : Factors that are within an organization’s control but detract from its ability to attain the desired goal. These are areas the business needs to improve to remain competitive.
• Opportunities : External chances to improve performance in the environment. Opportunities reflect the potential you can leverage to grow your business or project.
• Threats : External challenges to the business’s performance or project’s success. Threats might stem from various sources, such as economic downturns, increased competition, or changes in regulatory landscapes.

Why Use a SWOT Analysis?

We use a SWOT analysis for several important reasons in business and strategic planning:

• Strategic Overview : It provides a concise and comprehensive overview of the current strategic position of the business or project. By examining internal and external factors, stakeholders can get a clear picture of their situation.
• Decision Making : SWOT analysis aids in decision-making by highlighting the strengths to leverage, weaknesses to address, opportunities to pursue, and threats to mitigate. It helps in prioritizing actions based on the analysis.
• Opportunity Identification : SWOT analysis is instrumental in identifying new opportunities for growth and expansion. Opportunities might come from market trends , economic shifts, or changes in technology.
• Risk Management : By identifying threats, organizations can develop strategies to address or mitigate these risks before they become significant issues. It’s a proactive approach to managing potential external challenges.
• Resource Allocation : Understanding the organization’s strengths and weaknesses helps in the effective allocation of resources. Resources can be directed to areas where they are needed most or where they will have the highest impact.
• Competitive Advantage : It helps businesses identify unique features and capabilities that give them a competitive edge in the market. Recognizing these strengths can guide marketing strategies and business development.

How to Write a SWOT Analysis

Writing a strength in a SWOT analysis involves identifying and articulating the internal attributes and resources of a business or project that contribute to its success and competitive advantage. Here’s how to effectively write a strength in a SWOT analysis:

• Identify Internal Positive Attributes : Focus on internal factors that are within the control of the business. These can include resources, skills, or other advantages relative to competitors. Consider areas like strong brand reputation, proprietary technology, skilled workforce, financial resources, strategic location, and efficient processes.
• Be Specific and Relevant : General statements like “we have a good team” are less helpful than specific ones like “our team includes industry-recognized experts in X field.” The more precise you are, the more actionable your analysis will be. Ensure that the strengths are directly relevant to achieving the business’s goals and objectives.
• Use Quantifiable Data When Possible : Whenever you can, back up your strengths with quantifiable data. For example, “a customer satisfaction rate of 95%” or “a 20% lower production cost than industry average” provides concrete evidence of your strengths.
• Compare to Competitors : Strengths are often relative to the competition. Identify areas where your business outperforms competitors or fills a gap in the market. This might involve superior product quality, a unique service model, or a more extensive distribution network.

Example: Instead of simply stating “Experienced management team” as a strength, you could write: “Our management team has over 50 years of combined experience in the tech industry, including a track record of successful product launches and market expansions. This depth of experience provides us with strategic insights and operational expertise that have consistently resulted in market share growth and above-industry-average profitability.”

Writing a weakness in a SWOT analysis involves acknowledging and detailing the internal factors that limit or challenge your business or project’s ability to achieve its goals. Here’s a structured approach to effectively articulate weaknesses in a SWOT analysis:

• Identify Internal Limitations : Focus on internal attributes that are within the control of the organization but currently act as disadvantages. Weaknesses might include insufficient resources, lack of expertise, outdated technology, poor location, limited product range, or inefficiencies in processes.
• Be Specific and Honest : It’s important to be honest and specific about your organization’s weaknesses. Vague statements won’t help in addressing these issues. For instance, rather than saying “we need to improve our marketing,” specify “our current marketing strategy does not effectively reach our target demographic of 18-25-year-olds on digital platforms.”
• Use Internal Comparisons and Feedback : Compare your performance, processes, and resources against your own past performance or industry benchmarks. Utilize customer feedback, employee insights, and performance data to identify areas of weakness.
• Keep it Constructive : While it’s crucial to be honest about weaknesses, frame them in a way that focuses on potential for improvement. Consider each weakness as an area for development and growth.

Example: Instead of a broad statement like “Inadequate online presence,” a more effective description would be: “Our business currently lacks a robust online presence, reflected in our outdated website and minimal engagement on key social media platforms. This limits our ability to attract younger demographics who predominantly discover and interact with brands online. Improving our online visibility and engagement could enhance brand awareness and customer acquisition.”

Opportunities

Writing opportunities in a SWOT analysis involves identifying and articulating external factors that your business or project could exploit to its advantage. Opportunities are elements in the environment that, if leveraged effectively, could provide a pathway for growth, improvement, or competitive advantage. Here’s how to systematically approach writing opportunities in your SWOT analysis:

• Spot External Trends : Focus on the trends and changes outside your organization that could be beneficial. These might include technological advancements, shifts in consumer behavior, market gaps, regulatory changes, or economic trends.
• Be Relevant and Actionable : Ensure that the opportunities you identify are relevant to your business and actionable. They should align with your business’s strengths and capabilities, allowing you to take practical steps toward capitalizing on them.
• Use Market Research : Base your identification of opportunities on solid market research. Understand your target market , industry trends, and the competitive landscape to pinpoint where the real opportunities lie.
• Detail Potential Benefits : Clearly articulate how each opportunity could benefit your business. Whether it’s entering a new market, launching a new product line, or adopting new technology, explain the potential impact on your business growth and success.

Example: Rather than vaguely stating “New market segments,” a more strategic description of an opportunity could be: “With increasing consumer interest in sustainable living, there’s a growing market segment for eco-friendly products. Our business’s strong commitment to sustainability and existing lineup of environmentally friendly products positions us well to capture this emerging market. Expanding our product range to include more items that cater to eco-conscious consumers can tap into this trend, potentially opening up new revenue streams and enhancing our brand’s reputation as a leader in sustainability.”

Writing threats in a SWOT analysis involves identifying external challenges that could pose risks to your business or project’s success. These are factors outside your control that have the potential to harm your operations, financial performance, or strategic positioning. Addressing threats effectively in a SWOT analysis requires a focused approach:

• Identify External Challenges : Start by pinpointing the external factors that could negatively impact your business. This can include new competitors entering the market, changes in consumer preferences, technological advancements that render your product less desirable, regulatory changes, or economic downturns.
• Be Precise and Realistic : Clearly define each threat in specific terms, avoiding vague descriptions. Being realistic about the level of risk each threat poses is crucial; not every external challenge is a dire threat, but understanding the potential impact is key for strategic planning.
• Assess the Impact : For each threat identified, evaluate how it could impact your business. Consider the worst-case scenario and more likely outcomes to gauge the potential severity of the threat. This helps in prioritizing which threats need immediate attention and strategic response.
• Use Reliable Sources : Base your identification of threats on solid, reliable information. This might include industry reports, economic forecasts, and news sources that provide insights into market dynamics and external conditions.
• Consider Your Weaknesses : Link potential threats to your identified weaknesses. Understanding how external threats could exploit your vulnerabilities offers valuable insights for fortifying your business against these challenges.

Example: Instead of broadly stating “Economic uncertainty,” a more actionable description of a threat would be: “The looming economic downturn poses a significant threat to discretionary consumer spending. Given our business’s reliance on non-essential luxury products, a reduction in consumer spending could directly impact sales. This economic uncertainty requires us to diversify our product offerings and identify more value-oriented options to maintain customer engagement and spending during tighter economic conditions.”

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Frequently Asked Questions

Swot analysis: how to strengthen your business plan.

Introduction

Every business, big or small needs a solid plan to succeed. A well-constructed business plan takes into account the strengths and weaknesses of a company and the opportunities and threats present in the marketplace. One of the most useful tools for assessing these factors is the SWOT analysis as it provides a comprehensive overview of a company's current situation and potential for growth. In this article, we will discuss what a SWOT analysis is, why it is important for businesses, who should conduct it, and how to conduct it effectively.

What is a SWOT analysis?

Have you ever wondered how businesses manage to evaluate all the internal and external factors that could affect their success? Welcome to the SWOT analysis. It's a strategic planning tool that helps businesses identify their Strengths, Weaknesses, Opportunities, and Threats.

Strengths refer to internal factors that give a company an edge over its competitors. Think of a strong brand, loyal customer base, experienced employees, or efficient operations. Weaknesses, on the other hand, are internal factors that put a company at a disadvantage. These could be a weak brand, lack of funding, inexperienced employees, or outdated technology .

But what about external factors that could impact a business's success? That's where Opportunities and Threats come in. Opportunities are external factors that could help a company grow and succeed. This could include a growing market, new trends, technological advancements, or changes in regulations. Threats, on the other hand, are external factors that could harm a company's growth and success. Examples of threats could be economic downturns, increased competition, changes in consumer behavior, or natural disasters.

By conducting a SWOT analysis, businesses can make informed decisions about their strategic initiatives. By focusing their resources on areas with the greatest potential for growth and competitive advantage, businesses can increase their profitability, market share, and long-term success. So, whether you're a business strategist, executive, manager, or consultant, SWOT analysis can provide a fresh perspective on your company's current situation and potential for growth .

Why is a SWOT analysis important for businesses?

A SWOT analysis is essential for developing a business plan that maximizes a company's strengths, minimizes its weaknesses, and takes advantage of opportunities while mitigating threats.

Here are some of the reasons why a SWOT analysis is important for businesses:

• Identifies key areas for improvement By conducting the SWOT analysis, businesses can gain a better understanding of their internal weaknesses and external threats, which enables them to prioritize areas for improvement. They can then focus their resources and efforts on those areas, which can help them become more competitive and improve their overall performance.
• Maximizes the strength of businesses In addition to identifying areas for improvement, SWOT analysis also helps businesses identify their strengths. By leveraging these strengths, businesses can differentiate themselves from their competitors and take advantage of their competitive advantages. This can lead to increased market share, improved profitability, and overall success.
• Mitigates threats SWOT analysis can help businesses identify potential threats to their operations and take proactive measures to mitigate them. This could include diversifying their product or service offerings, investing in risk management strategies, or developing contingency plans to minimize the impact of unforeseen events.
• Takes advantage of potential opportunities In addition to mitigating threats, SWOT analysis can also help businesses identify potential opportunities for growth and success. By capitalizing on these opportunities, businesses can increase their market share, expand their customer base, and improve their overall performance.
• Provides a comprehensive overview Finally, SWOT analysis provides a comprehensive overview of a company's internal and external factors. This can help businesses develop a well-informed business plan that takes into account their current situation and potential for growth. By developing a strategic plan based on the SWOT analysis, businesses can increase their chances of success and achieve their long-term goals.

How to conduct a SWOT analysis?

Now that we know what a SWOT analysis is and why it is important for businesses, let's discuss how to conduct a SWOT analysis effectively. Here are the steps involved:

• Define the objective: The first step in conducting a SWOT analysis is to define the objective. What is the purpose of the analysis? What are the specific goals that the analysis aims to achieve? Defining the objective will help focus the analysis and ensure that it is relevant to the specific needs of the business.
• Gather information: Once you have defined the objective, the next step is to gather information about the business, its industry, and its competitors. This can include things like financial reports, customer feedback, market research, and competitor analysis.
• Identify strengths: What are the things that the business does well? What advantages does it have over its competitors? This can include things like a strong brand, loyal customer base, experienced employees, and efficient operations.
• Identify weaknesses: The next step is to identify the weaknesses of the business. What are the areas that need improvement? What disadvantages does it have compared to its competitors? This can include things like a weak brand, lack of funding, inexperienced employees, and outdated technology.
• Identify opportunities: To identify the opportunities available to the business , you need to address questions such as, What are the trends in the industry? What changes in regulations could benefit the business? What new technologies are emerging? This can include things like a growing market, new trends, technological advancements, and changes in regulations.
• Identify threats: The final step is to identify the threats to the business. What are the economic, social, and environmental factors that could impact the business negatively? What are the risks associated with the current situation and potential growth opportunities? This can include things like economic downturns, increased competition, changes in consumer behavior, and natural disasters.

Once the SWOT analysis is complete, the next step is to use the information to develop a strategic plan that maximizes the strengths of the business, minimizes its weaknesses, takes advantage of opportunities, and mitigates threats.

Who should conduct a SWOT analysis and what are the benefits?

A SWOT analysis can be conducted by anyone involved in the strategic planning process of a business. This can include business strategists , executives, managers, and consultants. Here are some of the benefits of conducting a SWOT analysis:

• Provides a fresh perspective on a company's strengths, weaknesses, opportunities, and threats, allowing for a more objective view of the situation.
• Facilitates strategic decision-making that enables businesses to make informed strategic decisions based on their current situation and potential for growth.
• Helps prioritize action items based on their importance and potential impact to the business.
• Encourages collaboration among team members, allowing for a more comprehensive analysis of the situation.
• Enables risk assessment associated with their current situation and potential growth opportunities.
• Improves communication among team members, ensuring that everyone is on the same page regarding the current situation and potential for growth.

This information helps businesses to prioritize their key strategic initiatives, focus their resources on areas with the greatest potential for growth and competitive advantage, and develop a strategic plan that aligns with their goals and objectives. Ultimately, a SWOT analysis helps businesses to make more effective strategic decisions that can lead to increased profitability, market share, and long-term success.

Example of a SWOT analysis

To help illustrate the SWOT analysis process, let's take a look at an example of a SWOT analysis for a company in the fashion industry:

• Strong brand recognition
• Innovative designs
• Loyal customer base
• Experienced and skilled designers and staff
• Efficient production processes
• Limited distribution channels
• Dependence on a few key suppliers
• High production costs
• Lack of international presence
• Limited online presence

Opportunities

• Growing demand for sustainable fashion
• Emerging markets in Asia and South America
• Expansion into e-commerce
• Partnership with influencers and celebrities
• Diversification of product offerings
• Economic downturns and recessions
• Increased competition from established and emerging brands
• Shifting consumer preferences and trends
• Changes in regulations and trade policies
• Disruptive technologies and innovations

Using this SWOT analysis, the company could focus on expanding its distribution channels and international presence, reducing production costs, and investing in sustainable and diverse product offerings.

Q: Is a SWOT analysis only for large businesses? A: No, a SWOT analysis is beneficial for businesses of all sizes, including small businesses.

Q: Can a SWOT analysis be conducted for a specific project or product? A: Yes, a SWOT analysis can be conducted for a specific project or product to evaluate its strengths, weaknesses, opportunities, and threats.

Q: How often should a SWOT analysis be conducted? A: It is recommended to conduct a SWOT analysis at least once a year or whenever there are significant changes in the industry, competition, or business environment.

Q: What should I do with the information gathered from a SWOT analysis? A: The information gathered from a SWOT analysis should be used to develop a strategic plan that maximizes strengths, minimizes weaknesses, takes advantage of opportunities, and mitigates threats.

In conclusion, a SWOT analysis is an important tool that can help businesses of all sizes and industries to identify their strengths, weaknesses, opportunities, and threats. By conducting a SWOT analysis, businesses can gain a better understanding of their current situation and potential growth opportunities, enabling them to make informed business decisions and develop effective business strategies. As a strategic leader or business strategist, it is important to conduct a SWOT analysis regularly to stay up-to-date with changes in the industry and competition, and ensure that your business plan is relevant and effective in achieving your business goals.

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A SWOT analysis can help a small business owner or business assess a company’s position to determine the most optimal strategy going forward. This business practice can help you identify what you’re doing well, what you want to do better, and what kinds of obstacles you might encounter along the way.

This guide will walk you through everything you need to know about a SWOT analysis: what it is, how it works, and how to do it. We’ll also include an example and a template to help guide you as you perform your own SWOT analysis.

What Is a SWOT Analysis?

A SWOT analysis is a strategic planning technique that outlines an organization’s strengths, weaknesses, opportunities, and threats. Assessing business competition in this way can help an organization plan strategically and execute more effectively.

The 4 Parts of a SWOT Analysis

Your business’s strengths SWOT section should include anything that your business does differently or better than competitors. Think about your unique value proposition, trends you’ve noticed in positive customer feedback, operational strengths, and company culture. This section is the perfect place to name and celebrate anything you’re already doing well.

Don’t be afraid to toot your own horn (while also remaining objective). Clearly identifying your business’s strengths not only helps you keep your spirits balanced as you address your weaknesses, it will also give you a sense of where to concentrate your resources. It’s easier to build a successful business when you’re working towards something, rather than acting in opposition.

Questions to help you determine your strengths:

• What is your business’s unique value proposition?
• What common compliments do you receive from your customers?
• What does your business do particularly well?
• How do you operate differently from your competitors?
• What gives you an edge on the competition ? (This can include something product-related like “better access to raw materials” or “lower cost of goods,” or it can be an internal strength like “strong company culture” or “employee motivation.”)
• What might your competitors name as your strengths?

Your weaknesses are the areas in which the business has room for improvement. You should include structural weaknesses in this section—those that relate to your systems, procedures, resources, and personnel. This is a great place to look at common feedback from employees (either from exit interviews, anonymous surveys, or other sources) and recurring customer complaints.

Questions to help you determine your weaknesses:

• What areas of your business could stand to improve?
• What are common hiccups in your customer experience ?
• How do you use your resources? Is there room for improvement?
• What improvements are needed in your employee experience?
• What weaknesses might your customers see that you tend to overlook?
• What weaknesses might your competitors think you have?

Opportunities

Your opportunities are the positive, external factors that your business might benefit from… but cannot directly control. That might include market opportunities, consumer purchasing trends, legal or regulatory changes, population changes, the cost of raw materials, and more. For example, businesses that provide accessibility for aging seniors might recognize the forthcoming “silver tsunami” of Baby Boomers entering the target demographic. This would be a clear opportunity to expand their customer base.

Questions to help you determine your opportunities:

• What trends might affect your industry?
• How might the right talent create new opportunities?
• your customers ask for anything you don’t offer (but could)?
• How might population changes affect your business opportunities? (think: generational shifts)
• Is there a need in the industry that you’re not creating, but could?
• Do your competitors have any weaknesses that could be opportunities for you?
• Is there a way to repackage current products to demand a higher price?
• Are there any new, or potential, regulatory or tax changes that might provide a new opportunity?

Your threats are the external factors that have the potential to negatively affect your business. A threat can be specific and competitor-based or more structural. buy clomid online buy clomid online no prescription Examples of structural threats could be supply chain challenges, shifts in market requirements, talent shortages, or changes to social media algorithms (especially if your business heavily relies on social media marketing). You might also face a threat (or threats) from your competitors. This can include the way they operate, how they’re marketing, or the products they offer.

Identifying every external threat your business faces is essential for your business to identify how it must adapt in order to meet and overcome these challenges.

Questions to help you determine threats:

• What happens if a supplier or manufacturer runs out of materials you use?
• What if a natural disaster (like a pandemic) strikes? buy amitriptyline online buy amitriptyline online no prescription
• Is your market shrinking?
• What are your competitors offering? Are they expanding or offering different products?
• How are your competitors marketing?
• What technological threats are you vulnerable to (website security, social media algorithm changes)?
• Are there any businesses that aren’t competitors now but could become competitors in the future?

The Benefits of a SWOT Analysis

SWOT analyses offer a variety of benefits for businesses and personal brands. Here are some of the most common benefits of a SWOT analysis:

• You can use it to determine a strategic plan.
• You can use it to drive an innovative, informed marketing plan.
• It can help you identify external opportunities.
• It can help you identify external threats.
• It can reveal environmental factors that might affect your business, either positively or negatively.
• You can develop a plan for how to tackle internal weaknesses.

How to Do a SWOT Analysis

You can approach SWOT analyses in multiple ways. You can conduct a personal SWOT analysis for yourself as an individual, you can perform a marketing SWOT analysis to determine a competitive advantage in your marketing , or you can use a SWOT analysis as a part of broader strategic planning.

Whatever your end goal for a SWOT analysis, follow these steps.

1. Create a SWOT Matrix

Use a SWOT template or create your own. You can create your SWOT framework on the computer or on a whiteboard—if you choose to do the latter, be sure that someone is in charge of recording the responses so that you don’t lose key insights (you can also take a picture at the end of the SWOT session).

2. Assemble Key Stakeholders

A SWOT analysis is most effective when it collects a variety of perspectives. Gathering key stakeholders with various perspectives will help you see more than you would have seen alone. Marketing leaders might be able to give you a more specific sense of the opportunities and threats related to your content marketing efforts. Your people team is closest to all personnel changes and feedback, so they’ll have the clearest sense of an organization’s strengths and what is driving employee retention (or challenging it). Sales leaders can help translate opportunities into a cohesive business strategy.

It’s simple: when it comes to a SWOT analysis, more heads are better than one.

3. Brainstorm Around Your Companies’ Strengths, Weaknesses, Opportunities, and Threats

Go through each field of the SWOT diagram, spending some time with each one. Ask the group the guiding questions to ensure you’re developing a comprehensive picture of the internal and external environment. There are no bad ideas in brainstorming. You’re just trying to get thoughts flowing. Something that feels like a “bad idea” might lead to discovering a potential threat you’d never thought of before or nuanced analysis of how you stack up to your nearest competitor. The key here is to keep the brainstorm going.

4. Record Relevant Thoughts in Their Respective Sections

As you brainstorm, record points and ideas when they are relevant. At the end of the session, your SWOT analysis should leave you with a clear sense of the organization’s strengths and company’s weaknesses that you can use to guide your strategy formulation.

5. Edit Your List

Revisit the SWOT diagram at a later time and edit it, culling out anything you don’t really need. You can also polish up some of the key insights gleaned in the brainstorming session. This is especially important if you plan to use your SWOT analysis as a more formal document that might be disseminated broadly.

6. Create a More Formal Version (Optional)

The final step, if you choose to do it, is to take your SWOT takeaways and put them together in a polished document that you can share.

A SWOT Analysis Example

It can be easier to understand how to approach a SWOT analysis if you’ve seen a SWOT analysis example. For the sake of this example, we will imagine a hypothetical company and what its SWOT analysis might look like.

The Business

An Instagram-friendly fitness business offering virtual workouts.

• The business is not limited to a specific geographic area.
• The company offers great benefits so employees tend to stay.
• Workouts look really good, so they market well on social media (particularly Instagram).
• The app experience can be glitchy.
• High customer churn rate.
• Competitors let you filter classes by the instructor. Ours doesn’t offer that.
• There is growing interest in our type of workout.
• As a result of the pandemic, consumers are more interested in at-home workouts.
• We could start offering retail products and branded workout equipment like our competitors do.
• Our app is vulnerable to hacking.
• If Instagram changes its algorithm, we may become wholly dependent on paid ads instead of organic posts.

A SWOT Analysis Template

Use this template to create your own SWOT analysis.

Strengths Section: What Your Company Does Well

Weaknesses section: what your company could improve, opportunities section: external factors you could use to your advantage, threats section: external factors that could harm your business, owning the hard truths of a swot analysis.

A SWOT analysis can bring up a lot of hard truths. It’s difficult to confront your company’s weaknesses and sometimes looking at threats can make them feel like the existential kind. Overcome these obstacles and give yourself the fortitude to confront business challenges head on with the Mental Toughness mini-course. The best part? It’s free.

About Mary Kate Miller

Mary Kate Miller writes about small business, real estate, and finance. In addition to writing for Foundr, her work has been published by The Washington Post, Teen Vogue, Bustle, and more. She lives in Chicago.

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Swot analysis guide: powerful examples and a free template.

Table of Contents

What is a SWOT Analysis

For example, a dip in profit margins for a business can be scrutinized using a SWOT analysis. This tool helps identify internal factors, such as inefficient practices or inflated costs, that might be causing this dip. Using the SWOT pillars – strengths, weaknesses, opportunities, and threats – one can derive strategies to rectify the problem and enhance profit margins.

A SWOT analysis serves as a cornerstone for strategic planning, enabling businesses to align their goals with internal capabilities and market realities. Strengths and Weaknesses are introspective elements, helping businesses to capitalize on their unique competencies and address internal shortcomings.

Be sure to watch SmartDraw’s insightful video, ‘What is SWOT? Definition, Examples and How to Do a SWOT Analysis.’ It’s a great addition to our comprehensive SWOT Analysis Guide, reinforcing key concepts and showcasing practical examples. This video enhances your understanding and makes the whole process of performing a SWOT analysis more digestible and engaging.

What is the Goal of a SWOT Analysis?

By understanding the internal and external factors that impact the business, organizations can make informed decisions about allocating resources, pursuing growth opportunities, and minimizing risks.

Pros of SWOT Analysis

Cons of swot analysis, breaking down a swot analysis (strengths, weaknesses, opportunities, and threats).

Writing a good SWOT analysis is crucial for small businesses looking to expand quickly and maintain a competitive edge over emerging competitors. It serves as a strategic planning tool that enables businesses to assess their internal strengths and weaknesses, as well as external opportunities and threats.

This could include external environment factors such as pricing, competition, lowered demand, and more. It can also include internal weaknesses that negatively affect the business, such as a lack of budget, small teams, etc.

Opportunities

The threats part of SWOT analyses can also scare off many. Essentially, the goal here is to look at potential threats that could negatively impact your business. Again, this can include internal issues and external threats that you identify.

By methodically examining these elements, a business can develop strategies that leverage their strong points, improve weaknesses, reinforce opportunities, and guard against external threats.

External and Internal Factors

Internal factors.

It is essential to understand your strengths and weaknesses in these areas to make strategic decisions and strengthen your competitive position.

It enables you to make informed financial decisions, such as allocating funds for research and development, marketing campaigns, or infrastructure improvements.

External Factors

External factors can present opportunities or threats to your business. For example, a growing market or favorable economic conditions can create opportunities for expansion and increased demand for your products or services.

Home Depot Example

Home Depot identified several noteworthy strengths, including high-quality customer service, strong brand recognition, and positive supplier relationships. Conversely, its weaknesses were identified as a constrained supply chain, reliance on the U.S. market, and a business model that could be easily replicated.

How do You do a SWOT Analysis?

The following table breaks down the SWOT analysis that follows into simple steps, making it easy to understand and follow. It serves as a concise, clear guide, making the process less overwhelming and more manageable.

Step 1: Gather Data

Financial statements, employee feedback.

Employee feedback is an essential resource for any company looking to conduct an effective SWOT Analysis. This data can provide insight into the issues facing your business, as well as potential solutions that could be beneficial for the company.

Step 2: Brainstorm

As an illustration, let’s consider a hedge fund that has devised an exclusive trading strategy generating exceptional returns that outperform the market. The fund now faces the task of determining the most effective approach to utilize these outcomes in order to appeal to prospective investors and expand its investor base.

Step 3: Analyze Strengths

The next step is analyzing the strength category by asking questions such as what are your main advantages, what resources do you have access to, or what makes your company stand out in the market. Looking at these inquiries objectively will allow you to gain insight into what makes you or your company successful.

Unique Features

Step 4: analyze weaknesses.

Where can decisions be better informed? Allowing yourself and your team time to think about areas that need attention ensures that possible solutions can be discussed further down the line.

Improvements

Decision-making, step 5: identify opportunities.

In order to find potential opportunities for change and growth look toward external factors such as what new technologies are emerging, what regulations are changing, and whether there are gaps in current products or services providing space for improvement. Keeping up with current events opens your mind up to alternative options.

Step 6: Analyze Threats

Step 7: construct an action plan + implement solutions, swot analysis template.

Now that we’ve gone through some examples in different industries, how do you get started on creating a SWOT analysis of your own? Luckily, this kind of analysis is pretty easy to structure. You can create one using your computer or even just divide a piece of paper into four quadrants and start writing.

SWOT Analysis Examples

When trying to come up with a SWOT analysis for your own business, it’s sometimes easier to see what others in your industry are doing. Before conducting a SWOT analysis for your company, you can look at some examples below to get some inspiration.

SWOT Analysis Example: Small Business

Marketing swot analysis, 3. company swot analysis example, swot analysis example for a restaurant.

Food service businesses tend to have their own unique challenges, so identifying potential strategies is often difficult. However, using a Restaurant SWOT analysis example, you can build off it and create a SWOT analysis for your business that’s reflective of the market.

Acting on Your Results

Swot analysis tips.

A strong SWOT analysis is about diving deep into your business and collating all the information in an organized way. The more you’re able to tap into what makes your business unique and what needs to improve, the more actionable your SWOT analysis will be.

Don’t be Afraid

Ask for feedback, be systematic.

Sometimes, the easiest way to fill out a SWOT analysis is to have a system. That can mean going through internal issues across each quadrant first and then moving to external factors. Or you can choose to do two quadrants at a time, such as strengths and opportunities if that is easier.

Create Timelines

Learn business abbreviations and acronyms, the takeaways.

By conducting a thorough SWOT analysis, businesses can gain valuable insights into their current position and make informed decisions to drive success and growth.

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What Is SWOT Analysis?

Understanding swot analysis, how to do a swot analysis, the bottom line.

• Fundamental Analysis

SWOT Analysis: How To With Table and Example

These frameworks are essential to fundamentally analyzing companies

Ariel Courage is an experienced editor, researcher, and former fact-checker. She has performed editing and fact-checking work for several leading finance publications, including The Motley Fool and Passport to Wall Street.

SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework used to evaluate a company's competitive position and to develop strategic planning. SWOT analysis assesses internal and external factors, as well as current and future potential.

A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the strengths and weaknesses of an organization, initiatives, or within its industry. The organization needs to keep the analysis accurate by avoiding pre-conceived beliefs or gray areas and instead focusing on real-life contexts. Companies should use it as a guide and not necessarily as a prescription.

Subscribe to 'Term of the Day' and learn a new financial term every day. Stay informed and make smart financial decisions. Sign up now .

Key Takeaways

• SWOT analysis is a strategic planning technique that provides assessment tools.
• Identifying core strengths, weaknesses, opportunities, and threats leads to fact-based analysis, fresh perspectives, and new ideas.
• A SWOT analysis pulls information internal sources (strengths of weaknesses of the specific company) as well as external forces that may have uncontrollable impacts to decisions (opportunities and threats).
• SWOT analysis works best when diverse groups or voices within an organization are free to provide realistic data points rather than prescribed messaging.
• Findings of a SWOT analysis are often synthesized to support a single objective or decision that a company is facing.

Investopedia / Xiaojie Liu

SWOT analysis is a technique for assessing the performance, competition, risk, and potential of a business, as well as part of a business such as a product line or division, an industry, or other entity.

Using internal and external data , the technique can guide businesses toward strategies more likely to be successful, and away from those in which they have been, or are likely to be, less successful. Independent SWOT analysts, investors, or competitors can also guide them on whether a company, product line, or industry might be strong or weak and why.

SWOT analysis was first used to analyze businesses. Now, it's often used by governments, nonprofits, and individuals, including investors and entrepreneurs. There is seemingly limitless applications to the SWOT analysis.

Components of SWOT Analysis

Investopedia / Julie Bang

Every SWOT analysis will include the following four categories. Though the elements and discoveries within these categories will vary from company to company, a SWOT analysis is not complete without each of these elements:

Strengths describe what an organization excels at and what separates it from the competition : a strong brand, loyal customer base, a strong balance sheet, unique technology, and so on. For example, a hedge fund may have developed a proprietary trading strategy that returns market-beating results. It must then decide how to use those results to attract new investors.

Weaknesses stop an organization from performing at its optimum level. They are areas where the business needs to improve to remain competitive: a weak brand, higher-than-average turnover, high levels of debt, an inadequate supply chain, or lack of capital.

Opportunities

Opportunities refer to favorable external factors that could give an organization a competitive advantage. For example, if a country cuts tariffs, a car manufacturer can export its cars into a new market, increasing sales and market share .

Threats refer to factors that have the potential to harm an organization. For example, a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop yield. Other common threats include things like rising costs for materials, increasing competition, tight labor supply. and so on.

Analysts present a SWOT analysis as a square segmented into four quadrants, each dedicated to an element of SWOT. This visual arrangement provides a quick overview of the company’s position. Although all the points under a particular heading may not be of equal importance, they all should represent key insights into the balance of opportunities and threats, advantages and disadvantages, and so forth.

The SWOT table is often laid out with the internal factors on the top row and the external factors on the bottom row. In addition, the items on the left side of the table are more positive/favorable aspects, while the items on the right are more concerning/negative elements.

A SWOT analysis can be broken into several steps with actionable items before and after analyzing the four components. In general, a SWOT analysis will involve the following steps.

Step 1: Determine Your Objective

A SWOT analysis can be broad, though more value will likely be generated if the analysis is pointed directly at an objective. For example, the objective of a SWOT analysis may focused only on whether or not to perform a new product rollout . With an objective in mind, a company will have guidance on what they hope to achieve at the end of the process. In this example, the SWOT analysis should help determine whether or not the product should be introduced.

Step 2: Gather Resources

Every SWOT analysis will vary, and a company may need different data sets to support pulling together different SWOT analysis tables. A company should begin by understanding what information it has access to, what data limitations it faces, and how reliable its external data sources are.

In addition to data, a company should understand the right combination of personnel to have involved in the analysis. Some staff may be more connected with external forces, while various staff within the manufacturing or sales departments may have a better grasp of what is going on internally. Having a broad set of perspectives is also more likely to yield diverse, value-adding contributions.

Step 3: Compile Ideas

For each of the four components of the SWOT analysis, the group of people assigned to performing the analysis should begin listing ideas within each category. Examples of questions to ask or consider for each group are in the table below.

Internal Factors

What occurs within the company serves as a great source of information for the strengths and weaknesses categories of the SWOT analysis. Examples of internal factors include financial and human resources , tangible and intangible (brand name) assets, and operational efficiencies.

Potential questions to list internal factors are:

• (Strength) What are we doing well?
• (Strength) What is our strongest asset?
• (Weakness) What are our detractors?
• (Weakness) What are our lowest-performing product lines?

External Factors

What happens outside of the company is equally as important to the success of a company as internal factors. External influences, such as monetary policies , market changes, and access to suppliers, are categories to pull from to create a list of opportunities and weaknesses.

Potential questions to list external factors are:

• (Opportunity) What trends are evident in the marketplace?
• (Opportunity) What demographics are we not targeting?
• (Threat) How many competitors exist, and what is their market share?
• (Threat) Are there new regulations that potentially could harm our operations or products?

Companies may consider performing this step as a "white-boarding" or "sticky note" session. The idea is there is no right or wrong answer; all participants should be encouraged to share whatever thoughts they have. These ideas can later be discarded; in the meantime, the goal should be to come up with as many items as possible to invoke creativity and inspiration in others.

Step 4: Refine Findings

With the list of ideas within each category, it is now time to clean-up the ideas. By refining the thoughts that everyone had, a company can focus on only the best ideas or largest risks to the company. This stage may require substantial debate among analysis participants, including bringing in upper management to help rank priorities.

Step 5: Develop the Strategy

Armed with the ranked list of strengths, weaknesses, opportunities, and threats, it is time to convert the SWOT analysis into a strategic plan. Members of the analysis team take the bulleted list of items within each category and create a synthesized plan that provides guidance on the original objective.

For example, the company debating whether to release a new product may have identified that it is the market leader for its existing product and there is the opportunity to expand to new markets. However, increased material costs, strained distribution lines, the need for additional staff, and unpredictable product demand may outweigh the strengths and opportunities. The analysis team develops the strategy to revisit the decision in six months in hopes of costs declining and market demand becoming more transparent.

Use a SWOT analysis to identify challenges affecting your business and opportunities that can enhance it. However, note that it is one of many techniques, not a prescription.

Benefits of SWOT Analysis

A SWOT analysis won't solve every major question a company has. However, there's a number of benefits to a SWOT analysis that make strategic decision-making easier.

• A SWOT analysis makes complex problems more manageable. There may be an overwhelming amount of data to analyze and relevant points to consider when making a complex decision. In general, a SWOT analysis that has been prepared by paring down all ideas and ranking bullets by importance will aggregate a large, potentially overwhelming problem into a more digestible report.
• A SWOT analysis requires external consider. Too often, a company may be tempted to only consider internal factors when making decisions. However, there are often items out of the company's control that may influence the outcome of a business decision. A SWOT analysis covers both the internal factors a company can manage and the external factors that may be more difficult to control.
• A SWOT analysis can be applied to almost every business question. The analysis can relate to an organization, team, or individual. It can also analyze a full product line , changes to brand, geographical expansion, or an acquisition. The SWOT analysis is a versatile tool that has many applications.
• A SWOT analysis leverages different data sources. A company will likely use internal information for strengths and weaknesses. The company will also need to gather external information relating to broad markets, competitors, or macroeconomic forces for opportunities and threats. Instead of relying on a single, potentially biased source, a good SWOT analysis compiles various angles.
• A SWOT analysis may not be overly costly to prepare. Some SWOT reports do not need to be overly technical; therefore, many different staff members can contribute to its preparation without training or external consulting.

SWOT Analysis Example

In 2015, a Value Line SWOT analysis of The Coca-Cola Company noted strengths such as its globally famous brand name, vast distribution network, and opportunities in emerging markets. However, it also noted weaknesses and threats such as foreign currency fluctuations, growing public interest in "healthy" beverages, and competition from healthy beverage providers.

Its SWOT analysis prompted Value Line to pose some tough questions about Coca-Cola's strategy, but also to note that the company "will probably remain a top-tier beverage provider" that offered conservative investors "a reliable source of income and a bit of capital gains exposure."

Five years later, the Value Line SWOT analysis proved effective as Coca-Cola remains the 6th strongest brand in the world (as it was then). Coca-Cola's shares (traded under ticker symbol KO) have increased in value by over 60% during the five years after the analysis was completed.

To get a better picture of a SWOT analysis, consider the example of a fictitious organic smoothie company. To better understand how it competes within the smoothie market and what it can do better, it conducted a SWOT analysis. Through this analysis, it identified that its strengths were good sourcing of ingredients, personalized customer service, and a strong relationship with suppliers. Peering within its operations, it identified a few areas of weakness: little product diversification, high turnover rates, and outdated equipment.

Examining how the external environment affects its business, it identified opportunities in emerging technology, untapped demographics, and a culture shift towards healthy living. It also found threats, such as a winter freeze damaging crops, a global pandemic, and kinks in the supply chain. In conjunction with other planning techniques, the company used the SWOT analysis to leverage its strengths and external opportunities to eliminate threats and strengthen areas where it is weak.

What Is an Example of SWOT Analysis?

Home Depot conducted a SWOT analysis, creating a balanced list of its internal advantages and disadvantages and external factors threatening its market position and growth strategy. High-quality customer service, strong brand recognition, and positive relationships with suppliers were some of its notable strengths; whereas, a constricted supply chain, interdependence on the U.S. market, and a replicable business model were listed as its weaknesses.

Closely related to its weaknesses, Home Depot's threats were the presence of close rivals, available substitutes, and the condition of the U.S. market. It found from this study and other analysis that expanding its supply chain and global footprint would be key to its growth.

What Are the 4 Steps of SWOT Analysis?

The four steps of SWOT analysis comprise the acronym SWOT: strengths, weaknesses, opportunities, and threats. These four aspects can be broken into two analytical steps. First, a company assesses its internal capabilities and determines its strengths and weaknesses. Then, a company looks outward and evaluates external factors that impact its business. These external factors may create opportunities or threaten existing operations.

How Do You Write a Good SWOT Analysis?

Creating a SWOT analysis involves identifying and analyzing the strengths, weaknesses, opportunities, and threats of a company. It is recommended to first create a list of questions to answer for each element. The questions serve as a guide for completing the SWOT analysis and creating a balanced list. The SWOT framework can be constructed in list format, as free text, or, most commonly, as a 4-cell table, with quadrants dedicated to each element. Strengths and weaknesses are listed first, followed by opportunities and threats.

Why Is SWOT Analysis Used?

A SWOT analysis is used to strategically identify areas of improvement or competitive advantages for a company. In addition to analyzing thing that a company does well, SWOT analysis takes a look at more detrimental, negative elements of a business. Using this information, a company can make smarter decisions to preserve what it does well, capitalize on its strengths, mitigate risk regarding weaknesses, and plan for events that may adversely affect the company in the future.

A SWOT analysis is a great way to guide business-strategy meetings. It's powerful to have everyone in the room discuss the company's core strengths and weaknesses, define the opportunities and threats, and brainstorm ideas. Oftentimes, the SWOT analysis you envision before the session changes throughout to reflect factors you were unaware of and would never have captured if not for the group’s input.

A company can use a SWOT for overall business strategy sessions or for a specific segment such as marketing, production, or sales. This way, you can see how the overall strategy developed from the SWOT analysis will filter down to the segments below before committing to it. You can also work in reverse with a segment-specific SWOT analysis that feeds into an overall SWOT analysis.

Although a useful planning tool, SWOT has limitations. It is one of several business planning techniques to consider and should not be used alone. Also, each point listed within the categories is not prioritized the same. SWOT does not account for the differences in weight. Therefore, a deeper analysis is needed, using another planning technique.

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SWOT Analysis: Identify Business Strengths and Weaknesses

SWOT Analysis is a simple four-box process that can be applied to all most any business and in any industry. Offering a way to discover and evaluate internal and external strengths and weaknesses. By identifying these factors, a business can develop strategies to take advantage of its strengths and opportunities while also addressing its weaknesses and threats.

This can help a business to improve its performance, competitiveness, and overall success. We will discuss the basics of SWOT analysis, including what it is, how it’s done, and the benefits it can provide to businesses. We will also be providing some examples and case studies to help illustrate the concepts and make it easier for you to understand. So, whether you’re a small business owner or a manager at a large corporation, this will provide valuable information that can help you improve your business.

What is SWOT analysis?

A SWOT analysis evaluates a business’s strengths, weaknesses, opportunities, and threats. The is where the name comes from and the acronym SWOT stands for Strengths, Weaknesses, Opportunities, and Threats . Sometimes reffered to as situational assessment or situational analysis.

A SWOT analysis is a strategic process planning tool that helps businesses evaluate their internal strengths and weaknesses and external opportunities and threats.

A SWOT analysis is used to identify and understand the internal and external factors that can have an impact on the success of a business or organization. By identifying these factors, a business can develop strategies to take advantage of its strengths and opportunities while also addressing its weaknesses and threats.

The creator and inventor of SWOT analysis framework are not fully known but are primarily credited to Albert Humphrey , Stanford Research Institute (SRI), in the late 1960s early 1970s. 

This can help a business to improve its performance, competitiveness, and overall success.

How to perform a SWOT Analysis?

SWOT Analysis is a low-cost way of assessing a business without needing expensive software or an external consultant. You don’t need special training or technical skills to complete the analysis process. 

This makes it easy for anyone and any size business can do this. Simplicity makes it easy for any team member to have input, regardless of their position within the business.

To conduct a SWOT analysis, a business should follow these steps:

• STRENGTHS – Identify the business’s strengths. These internal factors give the business an advantage over its competitors, such as a strong brand, skilled workforce, or proprietary technology.
• WEAKNESSES – Identify the business’s weaknesses. These internal factors put the business at a disadvantage, such as high operational costs, limited target market, or lack of brand recognition.
• OPPORTUNITIES – Identify external opportunities. These are external factors that the business can take advantage of to improve its performance, such as changes in market conditions, new technologies, or emerging trends.
• THREATS – Identify external threats. These external factors can negatively impact the business, such as competition, changes in consumer preferences, or economic downturns.

Once the SWOT analysis is complete, the business can use the information to develop strategies to take advantage of its strengths and opportunities while also addressing its weaknesses and threats. This can help a business to improve its performance, competitiveness, and overall success.

It’s worth noting that SWOT analysis can be used for various aspects of the business, like products, services, marketing, finances, processes, procedures and operations. It’s a flexible tool that can be used for different purposes and applied to different levels of the organization.

SWOT Analysis Process

There are number of steps that need to be considered in the SWOT Analysis Process:

• Personnel Involved  – Who is going to be involved? Make sure it comprises various people representing various positions, departments, demographics, and experiences. The swot analysis team needs a broad selection of people who can offer excellent feedback, but too many can be challenging will so many opinions
• SWOT Leader  – Someone outside the primary team without biases that could affect the outcome.
• Objective Strategy  – Why are you carrying out this SWOT analysis? Has some event triggered the need? New competitors, new products, new market? Revenues have reduced; why? What are the circumstances for the SWOT Analysis?
• Brainstorm SWOT  –Each team member involved in the analysis must discuss the business’s strengths and document people’s opinions. This can be as easy as sitting around a table and everyone having their input, and someone writing down comments. This is not about evaluating every response but documenting everyone’s input. Next, move onto weaknesses, opportunities and threats.
• Summary Input  – Discuss the next steps and how to move forward using the information gathered. How are you going to implement the results?
• Assign Tasks  – This is about getting the right people to implement change. After the improvement steps have been decided, each of the points identified in each stage of the SWOT strengths, weaknesses, opportunities, and threats must be implemented.

Why Is a SWOT Analysis Important?

SWOT Analysis makes businesses and their leaders stop what look and assess what direction the business is going. It opens up discussion on the future and the business’s short- and long-term goals.  

Sometimes when we are focused on running a business, it is easy to forget to assess how we are getting on and the opportunities for the business to grow moving forward. 

This can help the business to develop effective strategies for growth and success.

What are the benefits of swot analysis?

SWOT analysis can provide several benefits to businesses, including:

• Identifying Strengths and Weaknesses : Help a business identify its internal strengths and weaknesses, which can improve business performance and competitiveness.
• Identifying Opportunities and Threats : Help a business to identify external opportunities and threats, which can be used to develop strategies to take advantage of opportunities and mitigate threats.
• Strategic Options : By identifying internal and external factors, you can help a business to prioritize strategic options and make better-informed decisions.
• Communication and Alignment : The tool aids communication and alignment, as it can help ensure everyone knows the internal and external factors affecting the business.
• Gaps in Strategy or Planning : Identify potential gaps in strategy or planning which must be addressed.
• Benchmarking : Comparing the business with its competitors or industry standards and identifying areas of improvement.
• New Business Opportunities : Identify new opportunities for growth and expansion, such as new markets or products.
• Risks and Challenges : Help a business identify potential risks and challenges and develop strategies to mitigate them.

In summary, SWOT analysis can provide a comprehensive understanding of a business and its environment, which can be used to develop effective strategies, improve performance and competitiveness, productivity and achieve overall success.

SWOT Examples

Sure, here are a few examples and case studies that can help illustrate the concepts of SWOT analysis and make it easier to understand:

• Example: A small retail store that specializes in handmade crafts.
• Strengths: Unique product offerings, a strong reputation in the community, dedicated customer base.
• Weaknesses: Limited target market, high cost of goods sold, small store size.
• Opportunities: Expansion into online sales and partnerships with other businesses to increase visibility.
• Threats: Competition from larger retail chains and changes in consumer preferences.
• Case Study: Starbucks
• Strengths: Strong brand recognition, a worldwide market, a wide range of products, diversified revenue streams (e.g. licensing agreements, food offerings)
• Weaknesses: Dependence on a small number of key markets, high operational costs, and bottlenecks.
• Opportunities: Expansion into new international markets, increasing demand for convenient and high-quality food and beverages. Be more environmentally friendly.
• Threats: Intense competition, changing consumer preferences for healthier options, increased labour costs, store overheads.
• Example: A social media management company
• Strengths: Strong team of experienced professionals, successful track record of delivering results for clients
• Weaknesses: Limited focus on a specific industry, reliance on a small number of key clients
• Opportunities: Expansion into new markets and industries, development of new services (e.g. video content creation)
• Threats: Rapidly changing technology and algorithms, increased competition from larger companies entering the market

These examples and case studies demonstrate how SWOT analysis can be used to identify internal and external factors that can impact a business’s performance and competitiveness. By identifying these factors, a business can develop strategies to take advantage of its strengths and opportunities while also addressing its weaknesses and threats.

SWOT Overview

A SWOT analysis can be used to evaluate a business’s current position and identify potential opportunities for growth and improvement.

• A business can build on its strengths to improve performance and competitiveness by identifying its strengths.
• A business can develop strategies to mitigate or overcome its weaknesses by identifying them.
• A business can use external factors to improve performance by identifying opportunities.
• By identifying threats, a business can develop strategies to mitigate or overcome potential negative impacts on its operations.

In summary, SWOT analysis helps a business to identify its internal and external factors that are favourable or unfavourable to achieving its objectives.

Consider then introducing KPIs and OKRs as part of setting business goals from your decisions from SWOT results

How Checkify Help Implement Change from SWOT Analysis?

Checkify is a business process management software (BPMS); wondering what this is. Well, think of checklists with superpowers. Create a new business process to implement your change. Document what you want to be done and how to do it. Like a how-to guide to ensure everyone knows exactly what is changing, why and what the new process will be.

Break each process into individual tasks that can be assigned to different people. This removes the chances for mistakes and offers traceability and tracking of where everyone is within a process.

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What Is A SWOT Analysis? Download Our Free Template

Updated: May 28, 2024, 9:59pm

A SWOT analysis is a framework used in a business’s strategic planning to evaluate its competitive positioning in the marketplace. The analysis looks at four key characteristics that are typically used to compare how competitive the business can be within its industry. A proper SWOT analysis can give you a fact-based analysis to make decisions from, or it could spark your creativity for new products or directions.

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The Four Points of SWOT

The four points of a proper SWOT analysis are Strengths, Weaknesses, Opportunities and Threats. Strengths and Weaknesses focus internally on the business being evaluated, while Opportunities and Threats look at competition and things going on externally. Let’s look at the four points in more detail to determine how you can correctly evaluate each one.

• Strengths. Your Strengths are internal positives about your company that you can control and that often provide you with a competitive advantage. Some examples might be the quality of your product, the effectiveness of your processes, your access to physical or team assets or other competitive advantages.
• Weaknesses. A Weakness is an adverse internal attribute about your company that negatively takes away from your Strengths. Some examples might include knowledge gaps on your team, a low-quality product, a lack of money or other tangible assets, bad locations and more.
• Opportunities. An Opportunity is an external factor that provides promise or is likely to contribute to your potential success. Some examples might include the growth rate in your industry, specific laws or policies that will benefit the need for your product, positive customer feedback or technology advancements.
• Threats. A Threat is an external factor that you have no control over, which could negatively impact your success. These are typically acknowledged so that you can provide a plan to overcome each one. Some examples include potential future competitors, costs of supply, upcoming market trends, negative technology changes and upcoming regulations or laws.

The key to a strong SWOT analysis is accuracy in your research across all four points. Once you have the right information, you need to display it in an efficient and appealing way so that the data can easily be shared across your organization, with potential investors or with whoever might benefit the most from receiving it.

Downloadable SWOT Template

A SWOT analysis is usually presented in a grid form that provides the most important information from the analysis in each of the four points or areas. We have created a downloadable template that you can use to easily make your own SWOT analysis and include it as part of your next presentation or proposal. If preferred, you can also make a copy in Google Docs.

Download Free Template

How To Do an Effective SWOT Analysis

Every SWOT analysis is somewhat unique to each business but, ultimately, there is a straightforward process that can work for everyone. For example, you’ll have to complete all four points for a proper SWOT analysis but the research and method of getting the information could vary. The depth of each point might also vary depending on the age of your business, and the competition or opportunity in your industry.

The three steps to complete a proper SWOT analysis are:

• Gather the right stakeholders together. You need to involve more than yourself when going through a SWOT analysis. Key leaders and decision makers in your organization should be involved in going through the exercise. If you’re starting a business, you should include all who are involved in the business at this point in time.
• Brainstorm and capture SWOT data. The second step is to go through the process of identifying the information related to each of the four points. Everyone should do this independently as well as collectively.
• Analyze the data. Take all of the information collected through the brainstorming and come to an agreement on what factors should be represented in each of the main points. Then you can plug your information into the SWOT analysis template above and use this to strategically plan for future growth.

Questions To Aide Your Research for Each SWOT Point

When conducting the SWOT analysis, the most important part is making sure you’re as inclusive as possible with the analysis of each point. We’ve compiled a list of questions that you can use to start working through each point in your SWOT analysis so that you don’t leave anything off your list.

Use-case Examples

You can use a SWOT analysis for a number of activities, from deciding whether to invest in a business to helping an individual perform better at a non-profit. The use of SWOT is industry agnostic, as long as there are both internal and external factors that relate to the team, business or person being evaluated.

Some use-case examples for SWOT analysis include:

• A new business venture. Whenever a new business is launching it is a good idea to create a SWOT analysis to see where your Strengths and shortcomings lie. If you’re looking to raise money, then it will be expected that you’ve completed this analysis.
• Launching a new product. Whenever you’re launching a new product, you can treat it like a new business and complete the SWOT analysis to ensure success. Not doing your research beforehand could lead to targeting the wrong customers or not preparing for the competitive landscape.
• Improving team processes. From time to time, it could be beneficial to evaluate the performance of your team and see where you’re succeeding and what Opportunities exist to improve.
• Product team adding features. Every time a new feature is added to your product, your team can complete a SWOT analysis to see what impact it could have on the competitive landscape.
• Marketing team launching a campaign. Whenever a new target audience or method for reaching them is considered, the marketing team can complete a SWOT analysis to determine its potential.

As you can see, the sky’s the limit for use cases since you can use a SWOT analysis to determine the potential Strengths or roadblocks for just about anything.

Alternatives To SWOT Analysis

Depending on your situation, or your business, you may want to consider an alternative to a SWOT analysis. There are several options that can give you similar results, but these four alternatives are the most popular amongst businesses and teams looking at SWOT.

• SOAR analysis. SOAR stands for Strengths, Opportunities, Aspirations and Results. This is the most positive analysis on the list and is one of the most popular with those who dislike the SWOT analysis. This method requires you to evaluate the “six Is” of collaboration (initiate, inquire, imagine, innovate, inspire and implement).
• SCORE analysis. SCORE stands for Strengths, Challenges, Options, Responses and Effectiveness. Many like the “challenges” point of SCORE because it encompasses Threats, Weaknesses and obstacles in a single point while making all of them more of a positive opportunity. The SCORE methodology also focuses on actions you can take to improve instead of just focusing on the information from the analysis.
• NOISE analysis. NOISE stands for Needs, Opportunities, Improvements, Strengths and exceptions. The needs point focuses on the things your business or team needs to succeed instead of focusing on your shortcomings as things that stand in your way. This approach really trains you to see potential growth instead of roadblocks.
• Gap analysis. Gap is the only analysis on this list that doesn’t stand for anything. A gap analysis looks at where you’re at right now, where you want to go and how you close the gap between the two.

Check out our full guide to cost benefit analysis .

When To Use SWOT

When you need a broad analysis of your business, department, organizational or team potential, you should look no further than the SWOT analysis. It can provide a good overview of all of the major points that add up to potential success and help you draft a road map for potential growth. A SWOT analysis is also a good fit if you just need a quick comparison of your business to the competitive landscape that is out there.

When To Use an Alternative

If you need to dive deeper into specific factors or points of your business or team potential, then you may want to consider another alternative to the SWOT analysis. Alternatively, many pundits think that the word choices in SWOT are either vague or that they promote defeat. If you agree with that before you begin the SWOT analysis, then another option might be best for you so that the end goal of growing your business or team is met without obstacles.

Frequently Asked Questions

Who should complete a swot analysis.

Anyone looking to determine how a business or organization matches up against the competition, if there are both internal and external factors involved, should do a SWOT analysis. While a SWOT analysis is mostly used by new businesses or businesses launching a new product, it can also be used for any other type of organization and even for your local economy .

When should you do a SWOT analysis?

If you want to change your strategic positioning or launch a new product or service, then you should complete a SWOT analysis. Some also complete the exercise if they are just curious about their current positioning in their market or industry.

How do you write a good SWOT analysis?

A good SWOT analysis includes a full analysis of each point (Strengths, Weaknesses, Opportunities, Threats) as well as a clear and concise way of displaying the end results. The three primary steps to writing a good SWOT analysis are:

• Gather the right stakeholders together.
• Brainstorm and capture SWOT data.
• Analyze the data.

What are examples of threats in a SWOT analysis?

Threats are often external influences outside of your control; things that you risk by doing business. Inclement weather is one good example of something that you can’t combat and will have to deal with as it happens. Having a plan in place for dangerous storms will help you be prepared when they inevitably happen. Waiting for permits, supply chain failures and manufacturing errors can all impact your business negatively.

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What is a SWOT Analysis? (And When To Use It)

Use a SWOT (strengths, weaknesses, opportunities, threats) analysis to grow your business.

Table of Contents

A SWOT analysis is a planning process that helps your company overcome challenges and determine which new leads to pursue. “SWOT” stands for strengths, weaknesses, opportunities and threats. You should perform a SWOT analysis before you commit to any sort of company action, whether you are exploring new initiatives, revamping internal policies, considering opportunities to pivot or altering a plan midway through its execution.

While there are numerous ways to assess your company, one of the most effective is to conduct a SWOT analysis. Learn all about this approach below.

What is the objective of a SWOT analysis?

The primary objective of a SWOT analysis is to help organizations develop a full awareness of all the factors involved in making a business decision . Albert Humphrey of the Stanford Research Institute created this method in the 1960s during a study conducted to identify why corporate planning consistently failed. Since its creation, the SWOT analysis has become one of the most useful tools for business owners to start and grow their companies.

“It is impossible to accurately map out a small business’s future without first evaluating it from all angles, which includes an exhaustive look at all internal and external resources and threats,” Bonnie Taylor, chief marketing officer at CCS Innovations, told Business News Daily. “A SWOT accomplishes this in four straightforward steps that even rookie business owners can understand and embrace.”

When to perform a SWOT analysis

Employ a SWOT analysis before you commit to any company action, whether that’s exploring new initiatives, revamping internal policies, considering opportunities to pivot or altering a plan midway through its execution. Sometimes it’s wise to perform a general SWOT analysis to check on the current landscape of your business and improve operations as needed. The analysis can show you key areas where your organization is performing optimally and areas where operations need adjustment.

Don’t make the mistake of thinking about your business operations informally, in hopes that they will all come together on their own. If you take the time to put together a formal SWOT analysis, you’ll be able to see the whole picture of your business. From there, you can discover ways to improve or eliminate your company’s weaknesses and capitalize on its strengths.

While the business owner should certainly be involved in creating a SWOT analysis, it is often helpful to include other team members in the process. Ask for input from a variety of team members and openly discuss any contributions made. The collective knowledge of the team will allow you to adequately analyze your business from all sides. 

You can also conduct a personal SWOT analysis in your own life, whether for professional or other purposes. 

What does a SWOT analysis include?

A SWOT analysis focuses on the four elements of the acronym, allowing companies to identify the forces influencing a strategy, action or initiative. Knowing these positive and negative elements can help companies more effectively communicate what parts of a plan need to be recognized.

When drafting a SWOT analysis, individuals typically create a table split into four columns to list each impacting element side by side for comparison. Strengths and weaknesses won’t typically match listed opportunities and threats verbatim, although they should correlate, since they are tied together.

Billy Bauer, owner of ROYCE New York, noted that pairing external threats with internal weaknesses can highlight the most serious issues a company faces.

“Once you’ve identified your risks, you can then decide whether it is most appropriate to eliminate the internal weakness by assigning company resources to fix the problems, or to reduce the external threat by abandoning the threatened area of business and meeting it after strengthening your business,” said Bauer.

Internal factors

Strengths (S) and weaknesses (W) refer to internal factors, which are the resources and experience readily available to you.

These are some common internal factors:

• Financial resources (funding, sources of income and investment opportunities)
• Physical resources (location, facilities and equipment)
• Human resources (employees, volunteers and target audiences)
• Access to natural resources, trademarks , patents and copyrights
• Current processes (employee programs, department hierarchies and software systems) [See related articles: Best CRM software of 2024 and The Best Business Accounting Software Services of 2024 ]

External factors

External forces influence and affect every company, organization and individual. Whether these factors are connected directly or indirectly to opportunities (O) or threats (T), it is important to note and document each one.

External factors are typically things you or your company do not control, such as the following:

• Market trends (new products, technology advancements and shifts in audience needs)
• Economic trends (local, national and international financial trends)
• Funding (donations, legislature and other sources)
• Demographics
• Relationships with suppliers and partners
• Political, environmental and economic regulations

After you create your SWOT framework and fill out your SWOT analysis, you will need to come up with some recommendations and strategies based on the results. Linda Pophal, strategic marketing communication consultant and content marketer at Strategic Communications, said these strategies should focus on leveraging strengths and opportunities to overcome weaknesses and threats.

“This is actually the area of strategy development where organizations have an opportunity to be most creative and where innovative ideas can emerge, but only if the analysis has been appropriately prepared in the first place,” said Pophal.

SWOT examples

Bryan Weaver, an in-house advisor to Scholefield Construction Attorneys, was heavily involved in creating a SWOT analysis for his firm. He provided Business News Daily with a sample SWOT analysis template and example that was used in the firm’s decision to expand its practice to include dispute mediation services. His SWOT matrix included the following:

Resulting strategy: Take mediation courses to eliminate weaknesses and launch Scholefield Mediation, which uses name recognition with the law firm, and highlights that the firm’s construction and construction law experience makes it different.

“Our SWOT analysis forced us to methodically and objectively look at what we had to work with and what the marketplace was offering,” Weaver said. “We then crafted our business plan to emphasize the advantages of our strongest features while exploiting opportunities based on marketplace weaknesses.”

Additional business analysis strategies

The SWOT analysis is a simple but comprehensive strategy for identifying not only the weaknesses and threats of an action plan, but also the strengths and opportunities it makes possible. However, a SWOT analysis is just one tool in your business strategy. Additional analytic tools to consider include the PEST analysis (political, economic, social and technological), MOST analysis (mission, objective, strategies and tactics) and SCRS analysis (strategy, current state, requirements and solution).

Consistent business analysis and strategic planning is the best way to keep track of growth, strengths and weaknesses. Use a series of analysis strategies, like SWOT, in your decision-making process to examine and execute strategies in a more balanced, in-depth way.

Max Freedman and Nicole Fallon contributed to this article. Some source interviews were conducted for a previous version of this article.

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How to Do a SWOT Analysis for Better Strategic Planning

6 min. read

Updated October 27, 2023

Conducting a SWOT analysis of your business is a lot more fun than it sounds. It won’t take much time, and doing it forces you to think about your business in a whole new way.

The point of a SWOT analysis is to help you develop a strong business strategy by making sure you’ve considered all of your business’s strengths and weaknesses, as well as the opportunities and threats it faces in the marketplace.

• What is a SWOT analysis?

S.W.O.T. is an acronym that stands for Strengths, Weaknesses, Opportunities, and Threats. A SWOT analysis is an organized list of your business’s greatest strengths, weaknesses, opportunities, and threats.

Strengths and weaknesses are internal to the company (think: reputation, patents, location). You can change them over time but not without some work. Opportunities and threats are external (think: suppliers, competitors, prices)—they are out there in the market, happening whether you like it or not. You can’t change them.

Existing businesses can use a SWOT analysis, at any time, to assess a changing environment and respond proactively. In fact, I recommend conducting a strategy review meeting at least once a year that begins with a SWOT analysis.

New businesses should use a SWOT analysis as a part of their planning process. There is no “one size fits all” plan for your business, and thinking about your new business in terms of its unique “SWOTs” will put you on the right track right away, and save you from a lot of headaches later on.

Looking to get started right away? Download our free SWOT Analysis template.

In this article, I will cover the following:

• How to conduct a SWOT analysis
• Questions to ask during a SWOT analysis
• Example of a SWOT analysis
• TOWS analysis: Developing strategies for your SWOT analysis

To get the most complete, objective results, a SWOT analysis is best conducted by a group of people with different perspectives and stakes in your company. Management, sales, customer service, and even customers can all contribute valid insight. Moreover, the SWOT analysis process is an opportunity to bring your team together and encourage their participation in and adherence to your company’s resulting strategy.

A SWOT analysis is typically conducted using a four-square SWOT analysis template, but you could also just make lists for each category. Use the method that makes it easiest for you to organize and understand the results.

I recommend holding a brainstorming session to identify the factors in each of the four categories. Alternatively, you could ask team members to individually complete our free SWOT analysis template, and then meet to discuss and compile the results. As you work through each category, don’t be too concerned about elaborating at first; bullet points may be the best way to begin. Just capture the factors you believe are relevant in each of the four areas.

Once you are finished brainstorming, create a final, prioritized version of your SWOT analysis, listing the factors in each category in order of highest priority at the top to lowest priority at the bottom.

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I’ve compiled some questions below to help you develop each section of your SWOT analysis. There are certainly other questions you could ask; these are just meant to get you started.

Strengths (internal, positive factors)

Strengths describe the positive attributes, tangible and intangible, internal to your organization. They are within your control.

• What do you do well?
• Positive attributes of people , such as knowledge, background, education, credentials, network, reputation, or skills.
• Tangible assets of the company , such as capital, credit, existing customers or distribution channels, patents, or technology.
• What advantages do you have over your competition?
• Do you have strong research and development capabilities? Manufacturing facilities?
• What other positive aspects, internal to your business, add value or offer you a competitive advantage?

Weaknesses (internal, negative factors)

Weaknesses are aspects of your business that detract from the value you offer or place you at a competitive disadvantage. You need to enhance these areas in order to compete with your best competitor.

• What factors that are within your control detract from your ability to obtain or maintain a competitive edge?
• What areas need improvement to accomplish your objectives or compete with your strongest competitor?
• What does your business lack (for example, expertise or access to skills or technology)?
• Does your business have limited resources?
• Is your business in a poor location?

Opportunities (external, positive factors)

Opportunities are external attractive factors that represent reasons your business is likely to prosper.

• What opportunities exist in your market or the environment that you can benefit from?
• Is the perception of your business positive?
• Has there been recent market growth or have there been other changes in the market the create an opportunity?
• Is the opportunity ongoing, or is there just a window for it? In other words, how critical is your timing?

Threats (external, negative factors)

Threats include external factors beyond your control that could place your strategy, or the business itself, at risk. You have no control over these, but you may benefit by having contingency plans to address them if they should occur.

• Who are your existing or potential competitors?
• What factors beyond your control could place your business at risk?
• Are there challenges created by an unfavorable trend or development that may lead to deteriorating revenues or profits?
• What situations might threaten your marketing efforts?
• Has there been a significant change in supplier prices or the availability of raw materials?
• What about shifts in consumer behavior, the economy, or government regulations that could reduce your sales?
• Has a new product or technology been introduced that makes your products, equipment, or services obsolete?
• Examples of a SWOT analysis

For illustration, here’s a brief SWOT example from a hypothetical, medium-sized computer store in the United States:

See our SWOT analysis examples article for in-depth examples of SWOT analyses for several different industries and business types or download our free SWOT analysis template .

• TOWS analysis: Developing strategies from your SWOT analysis

Once you have identified and prioritized your SWOT results, you can use them to develop short-term and long-term strategies for your business. After all, the true value of this exercise is in using the results to maximize the positive influences on your business and minimize the negative ones.

But how do you turn your SWOT results into strategies? One way to do this is to consider how your company’s strengths, weaknesses, opportunities, and threats overlap with each other. This is sometimes called a TOWS analysis.

For example, look at the strengths you identified, and then come up with ways to use those strengths to maximize the opportunities (these are strength-opportunity strategies). Then, look at how those same strengths can be used to minimize the threats you identified (these are strength-threats strategies).

Continuing this process, use the opportunities you identified to develop strategies that will minimize the weaknesses (weakness-opportunity strategies) or avoid the threats (weakness-threats strategies).

The following table might help you organize the strategies in each area:

Once you’ve developed strategies and included them in your strategic plan, be sure to schedule regular review meetings. Use these meetings to talk about why the results of your strategies are different from what you’d planned (because they always will be) and decide what your team will do going forward.

Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

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How To Write a SWOT Analysis For a Business Plan

An acronym standing for Strengths, Weaknesses, Opportunities, and Threats, a SWOT Analysis is designed to help you analyze your company’s capabilities against the realities of your business environment. Doing so allows you to direct your business toward areas where your abilities are the strongest and your opportunities are abundant. It also allows you to develop short and long-term strategies for your business. A well-developed SWOT analysis will:

• capture business opportunities by capitalizing on business strengths
• overcome weaknesses to take advantage of business opportunities
• monitor potentially threatening outside forces while maintaining or developing internal strength response capabilities
• eliminate weaknesses to protect your business from threats

Writing a SWOT Analysis  

When writing your SWOT Analysis, we recommend involving employees with different perspectives and stakes in your company, for example, management, sales, customer service, and customers.

To write a SWOT Analysis for a business plan, we recommend following these four steps. You can use a four-square SWOT Analysis template, or if more manageable, you can make lists for each category.

Example of a four-square template:

After you’ve gathered the right group of employees together, brainstorm your company’s strengths and weaknesses and its opportunities and threats, first individually and then collectively.

Strengths and weaknesses are internal to your company and can change over time with work. Examples of internal factors include:

• Company culture
• Company image
• Operational efficiency
• Operational capacity
• Brand awareness
• Market share
• Financial resources
• Organizational structure

Opportunities and threats are external, happening whether you want them to or not, and can’t be changed. Examples of external factors include:

• Societal changes
• Competitors
• Economic environment
• Government regulations
• Market trends

Strengths refer to the positive, tangible and intangible attributes internal to your company that are within your control.

To help you determine what your company’s strengths are, ask yourself:

• What does the company do well?
• The positive attributes of your employees (knowledge, background, education, credentials, network, reputation, or skills)
• The tangible assets of the company (capital, credit, existing customers or distribution channels, patents, or technology)
• What advantages does the company have over our competitors?
• Do we have strong research and development capabilities? What about manufacturing facilities?
• What other positive aspects, internal to the business, add value or offer us a competitive advantage?

Any aspect of your business that detracts from the value you offer or places you at a competitive disadvantage is a weakness. To determine your company’s weaknesses, ask yourself these questions:

• What factors detract from a competitive edge?
• To accomplish my objectives or compete with my strongest competitor, what areas need to improve?
• What does the business lack? Is it expertise? Maybe it’s access to skills or technology?
• Does the company have limited resources?
• Is my business in a poor location?

Opportunities

Opportunities are attractive external factors that denote reasons your business is likely to thrive. To identify your business opportunities, ask yourself:

• What opportunities are there in my market or my environment that I can benefit from?
• Does my business have a positive perception?
• Has my market recently grown, or have there been other changes that have created an opportunity?
• Is this opportunity ongoing or time-limited? How critical is my timing?

Any external factor beyond your control that could place your strategy, or the business itself, at risk is a threat. Although you have no control over threats, you can benefit by having a contingency plan to address them if and when they occur. To identify threats, ask yourself:

• Who are my existing or potential competitors?
• What factors beyond my control could place my business at risk?
• Are there challenges created by an unfavourable trend or development that could lead to declining revenues or profits?
• What situations could threaten my marketing efforts?
• Have supplier prices or the availability of raw materials significantly changed?
• Are there any shifts in consumer behaviour, the economy, or government regulations that could reduce my sales?
• Are any of my products, equipment, or services obsolete due to the introduction of a new product or technology in the market?

Once you’ve brainstormed your lists of strengths, weaknesses, opportunities, and threats, we recommend ranking them through a voting process. At the end of this process, you should have a prioritized list of ideas, with one person, usually the CEO, having the final call on priority.

Divide your strengths into two groups:

• Group 1: Strengths that can help you take advantage of opportunities facing your business.
• Group 2: Strengths that can help you head off potential threats.

Divide your weaknesses into two groups:

• Group 1: Weaknesses that require improvement before you can take advantage of opportunities.
• Group 2: Weaknesses that you need to completely and quickly overhaul and convert into strengths to avert potential threats to your business.

Continually refer to your lists as you make decisions that contribute to your business, including developing strategies and actions for capitalizing on opportunities. Questions that can guide your decision making include:

• Do strengths open any opportunities?
• How can we convert weaknesses to strengths?
• What do we have to do to take advantage of opportunities?
• How can we best neutralize threats?

SWOT Analysis For a Business Plan Conclusion

Once you have finalized your SWOT Analysis and added it to your business plan, don’t just leave it and forget it. A SWOT Analysis is a crucial element in any business plan and should be revisited regularly, at least annually.

Suppose your business is facing significant changes in the marketplace or competitive conditions, experiencing growth problems, or failing to meet goals. In that case, you may want to revisit your SWOT Analysis more frequently.

It should reflect the world around you as it is, not the way it was. It’s an invaluable tool for leveraging your company’s strengths, minimizing threats, taking advantage of available opportunities, strategic planning, and determining company objectives.

At Bsbcon, we are available to provide support and guidance with your company’s SWOT Analysis, ensuring that it reflects the current state of your business and considers all factors needed to ensure your business’s short and long-term goals and successes. Once your SWOT Analysis is complete, we will work with you to incorporate it seamlessly into your business plan.

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SWOT Analysis In Business (With Examples)

• Business Growth

Here is a simple strategic SWOT analysis that you can use as a highly effective method for creating an edge in the market and to insure long term success.

SWOT is an acronym for the Strengths and Weakness of a business and the Opportunities and Threats facing the business. It is used to understand Current and Future, Internal and External factors that may have an effect on a  business results and success.

The Strengths and weaknesses are focused inward to analyze what your company does well and where it could be better. Opportunities and Threats are focused externally towards the industry, which analyze any potential negative effect on the business.

How To Carry Out A SWOT Analysis In Business

To carry out a SWOT analysis for your business, summarize the strengths, weaknesses, opportunities and threats of your business relative to competitors. A SWOT analysis is a simple, yet highly effective method for conducting an analysis on a business, product or service. Before you try writing a business or marketing plan, it is highly recommended that you first complete a SWOT analysis.

A SWOT approach to planning requires owners to look very closely and analytically at every aspect of their operation, so that objectives can be evaluated as achievable, while also building up a clear picture of the strategies that need to be adopted under the constraints that have been recognized.

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.” 

- Sun Tzu,  The Art Of War -

When completing a SWOT analysis, the aim is to reflect on all aspects of your business’s operations. You may wish to do this exercise alone or include your staff, spouse or business advisor. Whether you choose to do it alone or with others, make sure you allow a solid chunk of time to complete the analysis without being interrupted.

A SWOT analysis is a brainstorming exercise and to get the best results I suggest you allow yourself at least thirty minutes, or preferably an hour. This allows your mind to free itself of the multitude of thoughts and minor details of day to- day living. It takes time to get a flow of ideas going, so be patient and allow yourself time. Once you have allotted sufficient time to focus on this exercise it is time to get started.

SWOT Analysis Template: Excel Download

SWOT Analysis

Download SWOT Analysis Excel Template

This link will open as an Excel spreadsheet and is ready, and

easy to use but you can follow these video instructions for more information. 

SWOT Analysis Template Video

The SWOT Analysis Goal 

After you have successfully completed the SWOT analysis, take some time to explore ways to consolidate your strengths, minimize your weaknesses, take advantages of the opportunities and be prepared for the threats.

Your priorities should be to:

• Consolidate a strength
• Use a strength to address an opportunity or threat
• Use a strength to minimize a weakness or threat
• Convert a weakness to strength
• Convert a threat to an opportunity

SWOT Analysis Template: PDF Download

Download swot analysis pdf.

A SWOT analysis is a simple, yet highly effective method for conducting an analysis on a business, product or service. Before you try writing a business growth or marketing plan, it is highly recommended that you first complete a SWOT analysis.

S WOT Analysis - STRENGTH  

The first step is to reflect on what you do really well. What is working for you at the moment? Can you consolidate on any of these strengths and make them an even bigger advantage for your business? Try asking yourself the following questions

What are your business’s strengths?

• Attractive shopfront
• Operating hours
• Industry experience
• Follow-up service
• What do you do well?
• What unique resources can you draw on?
• What do others see as your strengths?
• How are you superior to your competitors?
• Why are your products or services so good?
• What is it that makes your business unique?

Potential Internal Strengths Can Be:

• Adequate financial resources.
• Well thought of by buyers.
• An acknowledged market leader.
• Well-conceived functional area strategies.
• Insulated from strong competitive pressure.
• Proprietary technology.
• Cost advantages.
• Better advertising campaigns.
• Product innovation skills.
• Proven management.
• Better manufacturing capability.
• Superior technological skills.

 “Appear weak when you are strong, and strong when you are weak.” 

- Sun Tzu, The Art Of War -

S W OT Analysis - WEAKNESS Examples

Weaknesses need to be understood so you can compensate or improve them. This is not the time to start beating yourself up for being less than perfect. Everyone has weaknesses. Your first task is to identify anything you think you need to improve. These could include:

• Time management
• Marketing strategy
• Certain products or services
• Cleaning up your work environment
• Follow-up procedures
• What could you improve?
• Where do you have fewer resources than others?
• What are others likely to see as weaknesses?

Potential Internal Weaknesses Can Be:

• No clear strategic direction.
• Obsolete facilities.
• Low profitability because …
• Lack of managerial depth and talent.
• Poor track record in implementing strategy.
• Internal operating problems.
• Too marrow a product line.
• Weak market image.
• Weak distribution network.
• Below-average marketing skills.
• Unable to finance needed changes.
• Higher overall costs relative to key competitors.

Make a comprehensive list and start reviewing which ones you could start transferring into strengths. If you find it difficult to be objective, ask someone you trust for his or her feedback on your perceived weaknesses.

“So in war, the way is to avoid what is strong, and strike at what is weak.”

SW O T Analysis - OPPORTUNITY 

The third stage of the analysis process is to look at the opportunities that your business has available. Where could you start gaining an advantage over your competitors? The more you know about what your competitors are doing, the easier it will be for you to see opportunities to create something different and compelling. Another great way to discover possible opportunities is to ask your current customers. They will often have all the answers if you are brave enough to ask the question.

• What external factors can you take advantage of?
• Are there current resources that are underutilized?
• How can you turn your strengths into opportunities?
• What trends could you take advantage of?
• What good opportunities are open to you?

Potential External Opportunities Can Be:

• Serve additional customer groups.
• Enter new markets or segments.
• Expand product line to meet broader range of customer needs.
• Diversify into related products.
• Falling trade barriers in attractive foreign markets.
• Complacency among rival firms.
• Faster market growth.

There are always opportunities. Take the time to brainstorm a comprehensive list and don’t sensor your ideas. There will be time to eliminate the most impractical ideas later. For now, just get the ideas down on paper.

“In the midst of chaos, there is also opportunity” 

SWO T  Analysis - THREAT  

Finally, you need to assess any current or future threats to your business. All potential threats should be brainstormed. It is better to be aware of problems that might arise than to be hit with them out of the blue. This list could include things like changes in legislation, a multinational competitor opening a store or a lack of products due to importing issues. Whatever the possible threats, list them and assess whether they are real or unlikely. Are there any threats to your current market share? When all areas have been plotted and identified, you will be in a much better position to plan your future.

Take the time to complete this exercise thoroughly as the benefits are very real.

• What threats do your weaknesses expose you to?
• What is your competition doing?
• What trends could harm you?

Potential External Threats Can Be:

• Entry of lower-cost foreign competitors.
• Rising sales of substitute products.
• Slower market growth.
• Adverse shifts in foreign exchange rates and trade policies of foreign governments.
• Costly regulatory requirements.
• Changing buyer needs.
• Adverse demographic changes.

SW OT Analysis Examples  

• Sample SWOT Ideas for a Local Restaurant
• Example SWOT for a Small, Local Coffee Chop Chain

“Who wishes to fight must first count the cost” 

About the Author Hans

Hans had 40 of his own businesses over the last 30 years and is famous for creating fast-growing businesses” He is an author, speaker, coach, and consultant and a specialist in business optimization and turnaround, helping smaller business owners eliminate business limitations, threats, and growth challenges in achieving their sales, profit, cash flow, and income goals with sniper precision.

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Why You Need a SWOT Analysis for Your Business

A SWOT analysis helps you make smart, informed business decisions.

Table of Contents

Understanding your company’s position within your market or industry and knowing how and where you can grow is critical for any business owner. This knowledge allows you to develop your company strategically rather than wasting your efforts trying to expand into a market that doesn’t align with your business or being steamrolled by a surprise competitor.

What is a SWOT analysis?

SWOT — which stands for “strengths, weaknesses, opportunities and threats” — is a type of analysis that helps you develop your business strategy by comparing internal factors (strengths and weaknesses) against external factors (opportunities and threats). Examples of internal factors include things that you have control over and can change, such as your staff or your intellectual property. External factors are things that you cannot control, such as consumer trends or competitors.

A SWOT analysis has four quadrants:

The analysis provides you with an accurate picture of what your business is currently doing well and how it can improve.

“[A SWOT analysis] gives you a firm grasp of what is affecting your business internally and externally,” said Lynne Pratt, creative content expert. “By carefully evaluating the analysis, a business can find new ways of progressing and achieving growth .”

Why should you do a SWOT analysis?

A SWOT analysis gives you a detailed, unbiased overview of your business as a whole or a specific product or campaign. It can also help train your brain to consider every factor that could affect your project or business. When you’re facing a tough issue or if you’re just unsure of your current strategy, a SWOT analysis illuminates details so you can formulate actionable plans based on each of the four quadrants.

For example, if you were considering opening a new location for your business, you could run a SWOT analysis to see if you are in a good position to do so. You could also use it to identify outside factors that you will need to plan for.

“A SWOT analysis is useful so that you don’t get caught entirely off-guard,” said David LaVine, founder of RocLogic Marketing. “You [should] do a SWOT analysis for each application area you’re considering operating in.”

“We conduct [analyses] every six months as a rule in our business,” said Alistair Dodds, marketing director and co-founder of Ever Increasing Circles. “They act as a great check on how the competition has evolved in that time period.” [Discover five effective ways to differentiate your product .] 

Who should conduct a SWOT analysis?

A SWOT analysis should be a collaborative effort between several levels of employment within your company. Founders and leaders should be the most closely involved, but to gain a true picture of your business, gather input from a group of people that can contribute several perspectives.

“It’s vital to go through your analysis with key stakeholders,” said Dodds. “When you identify weaknesses, it’s a great time to get other department heads and staff to suggest solutions — you’ll be amazed at the creativity and problem-solving inherent in your team if they are given the opportunity [for] input.” 

If you’re a solo operation, ask close friends or related professionals, such as your accountant, lawyer or advisor, for input. Having plenty of outside perspectives helps make your analysis as well-rounded and objective as possible. 

How to do a SWOT analysis

The first step of a SWOT analysis is to create your grid. Start with strengths in the upper left corner, then weaknesses in the upper right corner, opportunities in the bottom left and threats at the bottom right of the grid.

Next, fill in each quadrant. An easy way to do this is to ask yourself questions that apply to each box. Here are some suggestions.

• What do you do well?
• What unique skills or services do you have?
• What experiences do you have that can help you achieve your goal?
• What do you do better than your competitors?
• Where are you most profitable? Why?
• What aspects of your business could hinder your progress?
• What skills or resources are you lacking?
• What is costing you money?
• Is there anything you feel like you’re failing at?

Opportunities

• What can you improve?
• What external conditions can help you achieve your business goals ?
• Are there new audiences you could potentially reach?
• Is there technology you could use to enhance your business?
• Can you do more for your existing customers?
• Where or how could you expand your business?
• What external conditions could damage your progress or performance?
• What do your competitors do well?
• What are your competitors doing that you are not?
• What is going on in your industry?
• What is happening (or could happen) in the economy that could harm your business?
• Are there new competitors in your market?
• Is your target audience shrinking?

Here are some additional points to consider as you fill in your quadrants:

Your quadrants do not have to be perfect — you can always create multiple drafts of your analysis, editing what you have filled in as you go. Host a brainstorming meeting to complete your first draft.

After you have filled in the quadrants, review each quadrant and evaluate your results.

In preparation for these conversations, review some of the most important terms for business owners to enhance your ability to assess each area of the SWOT analysis and brainstorm solutions. 

How to evaluate your results

To evaluate your SWOT analysis effectively, start with your strengths and don’t brush them off, said Pratt. “You might feel that because you’ve got these nailed down that you don’t need to do anything with them, but this is wrong,” she said. “There is always room for improvement and working on your strengths, as well as [with] the [other quadrants], will help them remain your strengths.”

Next, look at your weaknesses and identify which aspects of your business each weakness is related to. For example, is poor customer retention due to staff? Location? Competitors? “Identify where the problem is coming from so you can begin to plan to address it,” said Pratt.

Then, you can see which of your threats are related to your weaknesses and if any of them are caused by something you can change. Try to connect your strengths to ways you can combat threats.

Finally, consider whether there are time constraints that could impact your opportunities. Are any of them short-term or seasonal? If so, make it a priority to hit those opportunities first and create an action plan for taking advantage of them.

Nathan Thompson, e-commerce and growth lead at The Others Beauty Co., said his company splits their business opportunities into short-, mid- and long-term goals. They set deadlines for each goal to ensure it gets done. “SWOT results should be analyzed and evaluated in order of actionability,” he said. “Having deadlines set for each milestone ensures accountability for all parties.”

As you’re evaluating your results, remember that your SWOT analysis is only a starting point, not an actionable plan. “Don’t confuse SWOT for strategy,” said Greg Githens, executive and leadership coach at Catalyst and Cadre. You are still responsible for developing a strategy that will take you from where you are to where you want to be, and SWOT provides a roadmap for that strategy.

A sample of SWOT in action

To see how SWOT analysis works, consider this example:

Soft-Touch makes pads that attach by Velcro to the plastic face mask worn by sleep apnea sufferers to help them breathe while they sleep. The company founder herself has sleep apnea, and she developed the product to increase the comfort of wearing the mask and to eliminate the marks it left on her face the following morning.

The company has largely grown its sales through word-of-mouth. A major sleep apnea equipment maker wants Soft-Touch to supply the pads for all of its masks. To satisfy the increased demand, Soft-Touch would have to outsource its manufacturing.

Here is a sample SWOT analysis for Soft-Touch as they consider this opportunity: 

Notice that the SWOT analysis doesn’t provide an answer; rather, it provides a framework to help formulate an answer and allows you to see exactly what the opportunities are (an expanded market share and increased revenue), what weaknesses currently limit the company (lack of funding and marketing expertise, limited manufacturing capacity), its current strengths (unique proposition and trusted brand) and the threats it could face if it takes the opportunity (less control and need for financing).

“Taking time to think strategically will lead to ways you can streamline to get more done as well as take your business into new directions that can benefit (or even save) the company,” said Joshua Ladick, president of GSA Focus.

Additional reporting by Sean Peek.

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SWOT analysis: Do you know your business’s strengths and weaknesses?

9-minute read

Strategic planning is essential for realizing your company's potential. Essential to that plan is an awareness of your company’s strengths and weaknesses, as well as understanding opportunities and threats facing your business.

A SWOT analysis takes a global view of your company but also evaluates smaller-scale elements of the business. It points out where you are strong, or not so strong, and can help you explore the opportunities and threats existing in your market. It’s this type of knowledge that makes your strategic planning that much more robust.

This is not an intellectual exercise. A SWOT analysis is the foundation of your strategic planning.

Michelle Feder

Director, Financial and People Strategies, Advisory Services at BDC

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What does SWOT stand for?

SWOT is an acronym for strengths, weaknesses, opportunities and threats .

Since your strengths and weaknesses are internal to your organization, and opportunities and threats external factors, SWOT analysis is sometimes called internal-external analysis.

What is a SWOT analysis?

SWOT analysis is a framework for identifying and analyzing your organization’s strengths and weaknesses, as well as the opportunities and threats you are facing.

“The strengths and weaknesses should not be seen as simple attributes of your company, but more specifically as something that stacks up against your competitors or that affects your clients’ experiences,” explains Michelle Feder, Director, Financial and People Strategies, BDC Advisory Services.

As for opportunities and threats, these typically refer to changes in your market, or in the wider world, that may take on a positive or negative risk for your business.

Why conduct a SWOT analysis?

Feder says you need to capitalize on your strengths while preventing your weaknesses from becoming a liability.

Put more effort into leveraging your strengths as they will be the key to your outperformance.

Working on your organization’s weaknesses can only get you so far. While it is important to neutralize your weaknesses so that they don’t undermine your success, Feder suggests instead to keep building on your obvious strengths, the ones that will differentiate you from your competitors.

You can use a template such as our free SWOT analysis template to help you.

What are the four parts of a SWOT analysis?

Strengths are the things that your company does particularly well, or resources and assets that it owns that distinguish it from your competitors. You need to know your company’s strengths; they’re what make it thrive.

Examples of strengths:

• solid financing
• a positive reputation
• valuable intellectual property
• an innovative mindset
• low production costs
• product variety
• a healthy company culture
• a strong online presence and following

Weaknesses are internal attributes and resources that your company lacks. You need to know your weaknesses because they make your business vulnerable. To identify the underlying cause of your company’s weaknesses (or its strengths), Feder suggests

using root cause analysis .

Examples of weaknesses:

• high levels of debt
• low customer satisfaction
• long delivery times
• outdated equipment and/or machinery
• gaps in expertise
• poor employee engagement and retention
• products slow to get to market
• rigid structures and a lack of agility

Opportunities

Opportunities are a set of external circumstances that, with the right decisions, can grow your company or put you in a favourable strategic position.

Examples of opportunities—and some possibilities for your business:

• new trade agreement—export possibilities
• new environmental, social and corporate governance (ESG) reporting requirements—can showcase your track record
• buy-local trend—favours your locally made products
• work-from-home trend—can promote your communication app
• expanding industry
• new government support programs

Threats are external forces that constitute a risk to your business. Your company should be on the lookout for external obstacles; it will have to overcome them if it is to flourish. To analyze the threats (and opportunities) facing your business, Feder suggests one of the tools be a PESTLE analysis, which takes in the political, economic, sociological, technological, legal and environmental factors that influence an organization.

Examples of threats:

• new trade agreement—which can bring increased competition
• new ESG reporting requirements—with possible heavier paperwork
• supply-chain problems
• shortage of recruits
• aging customer base
• changing product standards

An example of a SWOT analysis

Company: abc pharmaceuticals .

In this example, ABC Pharmaceuticals is strong in developing pharmaceuticals but weak at manufacturing them. Moreover, new reporting standards will make manufacturing more complex, while opportunities in the supply chains are opening up avenues for low-cost manufacturing. Given that its source of competitive advantage is its R&D capability, it may be better off outsourcing its manufacturing.

“ABC Pharmaceuticals’ competitive advantage is its ability to develop new formulations, and this is what it should focus on, while its competitor may be in the opposite situation and should probably focus on manufacturing,” says Feder.

When to conduct a SWOT analysis?

A SWOT analysis should be performed on a regular basis.

It’s recommended that a company perform a comprehensive analysis, using extensive data and looking at key industry players, every three to five years. The company can then spend a few hours doing a review of its initial assessment every year or every other year.

“Has anything changed in a fundamental way in the company or in the business environment?” asks Feder. Of course, the frequency of reviews and in-depth analyses will vary depending on the stability of your company and industry. “Hydro-Québec may not need to do a SWOT analysis more often than every five years,” says Feder. “On the other hand, TikTok will undoubtedly need to do it more often.”

Beyond those systematic analyses, a company can and should conduct a SWOT analysis on a smaller scale whenever it changes direction, and whenever it is facing a challenge on a more tactical level. A SWOT analysis can be very useful, for instance, if a specific business unit is underperforming or if the company wants to gain a deeper understanding of its product mix.

How often should you perform a SWOT analysis?

• In-depth analysis every 3-5 years
• Review every 1-2 years
• Small-scale analysis whenever smaller-scale problems come up, or at the department or team level

How to perform a SWOT analysis

A SWOT analysis is usually conducted in a workshop session, with leaders from every department present. Key employees and managers also typically take part in the sessions.

“You need to have a deliberate conversation about the four components of the SWOT analysis. You try to identify your strengths and weaknesses, and identify the opportunities and threats facing your company,” explains Feder.

To help with the process, it is important for everyone involved, when possible, to gather and present relevant data that point to every strength, weakness, opportunity and threat.

It can be useful to gather the following information before completing a SWOT analysis:

External factors:

• What are the market trends in your industry?
• What is your market share?
• Who are your main competitors?
• How can you stand out in the market?
• How do clients perceive you?
• What pitfalls and dangers await you?

Internal factors:

• Sales and marketing performance
• Financial performance and trends
• Efficiency of your systems and processes
• Key internal personnel, competencies and governance structure
• Your company’s culture and strategy
• You mission, vision and values

Consider getting an outside expert

While it’s possible for most companies to perform their own SWOT analysis, it may be a good idea to involve a neutral third party, suggests Feder.

“Leaders will sometimes sit and discuss together, and say ‘We’re strong at this and this and this,’ and before your know it, they have come up with a lengthy list of strengths while the weakness list remains pretty thin.”

Feder says that business owners are often surprised to learn that their strengths don’t necessarily lie where they thought, but also, that they have weaknesses they did not suspect they had.

Ask your clients, ask your business partners, ask your friends, ask your suppliers: what are our strengths and weaknesses?

The effort should culminate in a report summarizing the results of the analysis.

“It doesn’t need to be a long, complicated report involving the hiring of a new employee,” reassures Feder. “You can do a four-hour meeting and summarize your conclusions in a few pages, or maybe even on a white board. What’s important is for everyone to keep this framework in mind.”

SWOT – Questions to consider

Advertisements		»    »    »    »    »  , updated on are competitive advantages that allow a firm to outcompete, generate value and achieve efficiency. Strengths are often identified as part of , and . The following are common business strengths.

SWOT Analysis

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Swot weaknesses, swot strengths, business weaknesses, external environment, competitive factors, competitive advantage, business value, information advantage, strategic advantage, competitive differentiation, cost innovation, customer value, new articles.

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Home » Business Cycle » Business strengths and weaknesses

How to analyze business strengths

Business is a sport for gladiators – but building a business takes more than grit and determination. It takes the ability to be honest with yourself. To recognize that you have both business strengths and weaknesses that can make or break your success. And to put in the work to transform those weaknesses into opportunities and better use your strengths. By making a list of business strengths and weaknesses and analyzing them, you can create a better business map to achieve sustainable, long-term growth. 

Reveal your business strengths and weaknesses right now

What are the strengths and weaknesses of a business?

Your business strengths and weaknesses are the areas in which your business excels and those where you fall behind the competition. They can include anything from your product to your processes, supply chain or company culture . They can also change over time as your business grows and the market evolves.

Business strengths and weaknesses are often thought of in terms of SWOT analysis – a planning technique that looks at strengths, weaknesses, opportunities and threats. But your strengths and weaknesses are the most vital part of any business analysis, because when you are in control of your internal processes, you’re better prepared to face external challenges and turn them into opportunities.

List of business strengths and weaknesses

It isn’t always easy to recognize your business strengths and weaknesses . Every business owner has blind spots, especially when it comes to how their own psychology affects their organization. But an honest assessment will likely turn up at least a few common strengths and weaknesses.

Common business strengths

Strong, innovative company culture

Unique product or knowledge

Excellent efficiency and productivity

Customer service that creates raving fan customers

Ability to scale sustainably

Speed to market

High adaptability

Diversification of products or services

Strong, decisive leadership

Common business weaknesses

Weak, fragmented company culture

Lack of product differentiation

Low efficiency and high waste

Poor customer service

Unregulated and unplanned growth

Slower to market than competitors

Rigid structure that reduces agility

No diversification

Leadership limitations such as lack of self-awareness 

How to identify business strengths and weaknesses

Every business has different traits, so this list of business strengths and weaknesses is just the beginning. To really uncover your own, you’ll need a strong process.

1. Become more self-aware

A business is only as strong as the psychology of its leader, which is why self-awareness in business is so important. Self-awareness means being in touch with your own thoughts and feelings and how they affect your behavior. When you are self-aware, you’re more able to control your emotions , make tough decisions and be a better leader. You’re also able to look at your business strengths and weaknesses more objectively and assess how your own actions and mindset affect your success – or failure.

2. Know what to look for

Sometimes the answer to “ What are the strengths and weaknesses of a business ?” is obvious. Revenue growth , diversification, physical assets and intellectual property are common places to start. But there are many other areas to look at when performing your assessment. Do you have a particularly talented team? A strong company culture that encourages risk-taking and innovation? Efficient operations that save time while improving productivity? Don’t forget about these key areas.

3. Put yourself in a customer’s shoes

Everything goes back to creating raving fan customers , including how you identify business strengths and weaknesses . You need to uncover your X factor : the way that you provide more value than anyone else. That’s your biggest business strength . Asking for customer feedback and taking it to heart is also one of the best ways to uncover your weaknesses. Customers will almost always be honest – just ask them.

4. Ask around

You’ll never get a holistic view of your business strengths and weaknesses if you only listen to your own opinions. Always interview other stakeholders, board members and team members at every level of the company. Join a board or ask your mentor for an outside opinion. Remember what Tony says: “Successful people ask better questions, and as a result, they get better answers.” In all of your interviews, be sure you’re asking the right questions and practice deep listening to instill trust and get honest feedback.

5. Look at the competition

Your business strengths and weaknesses may be internal factors, but it is still essential to look at your competition. You may think you have a strong marketing strategy, customer service or processes, but competitive analysis reveals otherwise. Or perhaps you’ll realize that you’re not as weak in some areas as you thought. Determining where you can win is a natural next step. 

6. Continually assess

Making a list of business strengths and weaknesses isn’t a one-time task. Any successful business owner needs to commit to constant and never-ending improvement – and that means continually reassessing every aspect of your business. Markets change. Businesses grow. Str engths can even become risks if they become too ingrained and limit your agility and ability to innovate. Review your business strengths and weaknesses at least once a year using the process outlined here.

Ready to transform business weaknesses into strengths?

Reveal how to leverage your business strengths and improve weaknesses at an immersive Business Mastery event .

© 2024 Robbins Research International, Inc. All rights reserved.

How to Identify Your Company’s Weaknesses

Every business has strengths and weaknesses, even those that seem like they have it all together and dominate the market. Unfortunately, even though it is essential for every business to identify its strengths and weaknesses, not every business owner takes the time to do it. Identifying strengths is often easy, but admitting weaknesses is more challenging.

When we talk about an ideal state of order, we seek insight into strengths and weaknesses. Perfection may be a myth, but every minor flaw can turn into a nightmare in business. Therefore, companies have difficulty thriving while hosting flaws, so it’s essential to identify the weaknesses of a business.

How to Identify a Company’s Strengths and Weaknesses

Since every company is different, it is evident that ways of identifying their strengths & weaknesses should also be different. Most companies use SWOT analysis , a planning approach that considers:

• Strengths: Determine talents and competencies, your resources, stability of your business brand.
• Weaknesses: Find your flaws, sources of customer complaints and employee discontent, and activities to be enhanced.
• Opportunities: Explore the impact of technology on your business, look after your clients’ needs, find new ways to produce your products, and research new markets or new product/service offerings.
• Threats: Are your customers’ requirements shifting away from your product? Does your competitor offer similar products in a lower price range? Are your staff and customers happy?

The most crucial element of any business study is determining its strengths and weaknesses, not just to capture facts and information but to apply what you learn to establish development and risk-mitigation plans.

For example, applying SWOT analysis for a small business startup aligns the positive aspects to help you capitalize on possibilities, discover gaps in processes, and identify weak elements that need to be rectified or eliminated. SWOT demands one take a strategic leap, looking at the links across categories (e.g., how does a strength assist us in managing a threat) and looking holistically for upcoming trends.

SWOT analysis also helps in the following ways:

• Strengths keep overhead low by modifying the compensation structure to balance basic pay with performance-based bonuses.
• Weaknesses lead to researching, implementing, and adhering to a project planning strategy.
• Opportunities result in testing a new market with a single existing product.
• Threats may reveal a lack of expertise in the new market segment or a business partner in a performance-based commission system.

The Importance of Identifying Weaknesses

When you are informed of your flaws, you may use them as a springboard for constructive development. Because you’ll be addressing and maybe repairing anything that could be perceived as a threat to your business, that change may help you strengthen your company for the future. To understand this better:

• Companies experiencing product or labor shortages are in danger of experiencing problems if they have not appropriately planned.
• Working on weaknesses will help you increase revenue and profit margins.
• Understand how your company is performing compared to the competition.
• Prepare the best marketing strategies to increase sales and form better customer relationships.
• Working on your weaknesses makes the workplace better for your employees and improves employee retention.
• The process will help you establish effective employee programs to upskill themselves.
• Acts as an essential step towards improving company culture and reputation.

Tips to Identify a Company’s Weaknesses

Review work processes.

To identify weaknesses in your company, first review your work processes. This is critical to understand your company’s strengths and shortcomings. This review may reveal flaws such as a rigid structure, a weak business model, poor customer service, or a lack of leadership. Regardless, the goal is to improve. Admitting defects might be challenging, but one must recognize these aspects and improve for future growth.

Check What Your Competitors Are Doing

A business does not thrive at its own pace. As a business owner, you should also know your competitor’s vision. Many sectors have trade groups that conduct surveys of their members and produce information on industry performance. Suppose a business owner notices that their figures, such as gross margin or profit as a percentage of sales, differ considerably from industry norms. In that case, they might obtain a fair picture of their company’s relative strengths and shortcomings.

For example, if a company’s employees’ expenses are substantially greater than industry norms, the owner may assume that one of the company’s shortcomings is staff productivity. Therefore, they would design strategies and techniques to overcome that challenge in the business plan.

Talk to People Within the Company

Crucial to identifying weaknesses, this important tactic requires an environment where employees feel safe and valued and do not fear retaliation. Consult the leadership and management teams within the company. Your manager knows what’s lacking in the business model. Your sales team is aware of the shortcomings and knows what needs to be improved. All you need to do is ask them–and don’t kill the messenger.

People who work for and with you know your business better than any expert. They are the assets that will take your business further, and their insights are equally important.

Review Previous Experiences

Making a list of your company’s strengths and flaws is a continuous process. A successful business owner must be committed to constant improvement, which involves routinely reevaluating every company area. Markets fluctuate, and businesses expand. If your strengths become too embedded, they might become risks and limit your mobility and capacity to innovate.

Review your company’s strengths and problems at least once a year. It is not easy to identify weaknesses in your company, but doing so and acting on the insight will help you build a valuable company. In addition, revisiting past experiences will help you keep track of dos and don’ts.

Review Your Statistics

It sometimes becomes overwhelming to manage everything, even if you have a staff working for you. Let’s say you’re looking forward to selling your business. The first thing that concerns the buyer is your company’s value. The buyer values a business with a pre-existing plan containing crucial elements, such as a well-established client base, well-defined operational expenditures, and adequately trained workers.

Having statistical data ready for a buyer is the key to identifying and rectifying weaknesses beforehand. Another benefit of collating data is knowing what’s missing and what needs to be improved. It is rightly said that an organized organization wins billions.

Make Improvements

Collecting the information important to a buyer reveals your company’s strengths and weaknesses. Most crucial is the information concerning your flaws: those should be addressed. Don’t overwhelm yourself and your staff by attempting to correct everything at once. Instead, concentrate on two or three flaws at a time. That way, you can set a goal for each and work toward it before moving on to the next.

If improvements can be made right away, that’s fantastic; but don’t worry if they need long-term answers. Instead, start making improvements, work on your weak areas, and things will improve with time.

Knowing Is Half the Battle

Running a successful business requires continual planning, strategizing, building value, and time. Implementing a routine to identify and measure your company’s strengths and weaknesses will bring you closer to your business and personal growth goals. Whether thriving as an entrepreneur or prepping the table to present your business to a seller, the right way to identify weaknesses in your business and work on them is through mindful management and strategic planning.

You’ve already taken a big step by recognizing your strengths and shortcomings. This knowledge puts you in a better position to build your marketing foundation for development. Then, you’ll be able to develop your strategic roadmap, set company objectives, and decide the best approaches to implement your strategy.

Makalyn Feaster

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Strengths and weaknesses of a business plan example .

A business plan is a manuscript or a document comprising all the details about the strategic goals and objectives of the growing and emerging business, venture, or start. It also offers plans and strategies on how to achieve them. Today, we’ll discuss the strengths and weaknesses of a business plan example.

A business plan offers you the following information;

• Analyzing your business model
• Offered products and services
• The price you are going to charge
• Targeted customer market
• Strategies and techniques you employ to achieve success

Let’s discuss the strengths and weaknesses of a business plan; here they’re as follows;

Strengths of a Business Plan 

Some of the key strengths in the “strengths and weaknesses of a business plan example” are as follows;

Brings Everyone Onboard

A business plan requires information from various people in multiple departments and units of the company. You have to cooperate and collaborate with all of them for the growth and success of your business. Other than a business plan, their views and opinions are not important. While writing the business plan, make sure that everyone is on board, and utilizes their energy for the growth of your business.

Financial Access

When launching a new business project or entering a new market, the company needs funds to get things started. Banks and other financial institutions are great sources of getting funds. Without having a proper and documented business plan, they won’t offer you the loan that you need for your business expansion. In fact, a written business plan is their primary requirement for loans and funding.

Learn Resource Allocation

A business plan guides you about the capital, budget, and resources you need for the growth of your business or the execution of your business idea. Some of the raw materials and resources that you need for your business operations are scarce. While writing the business plan; you should keep mentioning the scarcity and how you would manage them by reallocating the budget and resources.

Bird View To The Future

A well-written business plan offers you a glimpse into the future of the business and how it would look once it succeeds. You don’t have to invest in a such project that would cost you a lot of money than potential earnings and profitability. However, if a glimpse into the future comprises a lot of confusion and uncertainties, then you don’t have to invest in such projects.

Show Your Commitment

Floating and discussing a business idea is one thing, but writing a comprehensive business plan by discussing various factors shows your commitment to the business venture. It allows you to discuss your business idea more effectively, and you can also explain the worth and value of your business along with potential growth possibilities.

Recognize Target Demographic

Without identifying and recognizing the target customers, your business idea can’t succeed. Whether you are selling goods online or doing business in the service industry, you should identify your target customers where they are, and how you should approach them. Without conducting in-depth planning, you don’t know how where your target audience is and how to approach them.

Marketing & Promotional Strategy

A good business plan helps you to identify your target customer market and offers them goods and services. It allows you to create a value proposition for your brand and approach every segment effectively.

Weaknesses of a Business Plan 

Some of the main weaknesses in the “strengths and weaknesses of a business plan example” are as follows;

Demand Execution Strategy

Well-designed comprehensive planning is useless if it is not delivering the required results. A good business plan comes with a lot of responsibilities; demands a great implementation strategy; develops the ground for collecting information and becomes a necessary part of the company. An ineffective execution strategy has destroyed various businesses.

Limited Liability

Usually, it is the responsibility of one person to develop a business plan, but you can’t hold him accountable for ineffective processes during the implementation stage. It is because they developed the plan based on their perception of reality and how they perceive things.

Excessive Analysis

The focus of the business plan is on excessive analysis and hypothetical scenarios in terms of how things should be rather than what they are. It accurately explains the number of things that you require and needs for launching the business in the market. However, it doesn’t tell you how you should approach your target customer market, the issues you would face, and how you should manage them.

Could be Wrong

It doesn’t go without saying the significance of including the right personnel to create a business plan that has got real-life experience and a vision of influencing others. But the problem is that many small businesses don’t have the luxury of having professional expertise at their disposal. However, they don’t have the inground business experience and belong to various other fields. Resultantly, their business plan comprises a lot of inaccurate information.

The business plan creates a set of boundaries and tells you how you should do things in a certain way. But some business ventures require a free hand for their creative team to experiment with new things. In other words, the company’s top management dictates the terms, conditions, mission, and vision of the company. The implementing team in the front line doesn’t have any say in it.

Outdate Facts

We are living in the fast-evolving world of the 21st century where things, facts, and figures are always changing. Your business plan comprises various facts and figures of today’s forecasting, but you aren’t sure how things would be in the future. By the time you get funds and implement the business, the facts and figures won’t be the same.

Without Guarantee

A business plan offers you a comprehensive guideline on how to start a business with all the basic and necessary details. Some of the information in it is correct, and the others are incorrect or outdated, but it doesn’t guarantee you about anything that your business would be successful if you 100% follow all the guidelines. It may or may not, depending on various factors.

Inconsistency

It is possible that you have got multiple target markets, conflicting facts and figures, and competing strategies for marketing and product planning. In the presence of such inconsistent information, it becomes highly difficult for an investor to decide whether to invest or not. Most importantly, you won’t find coherence in all of them, because different people have written various sections of the business plan.

Distribution Network Unknown

Your business plan doesn’t tell why you have to use a particular distribution channel for the delivery of your product or service. You aren’t sure whether it would reach your target audience or not; why this channel is good and others are not. However, the distribution strategy is highly significant because it delivers your product or service to the target audience.

Not Aware of Competitors

It doesn’t matter how much unique and creative your product offer is; you would always face competition in the market. There is no such thing as a free market and the market without competition. However, if the business plan focuses on the competition, then it would push away many new investors; that’s why they focus on product differentiation points rather than highlighting competition.

Unidentified Target Customers

The business plan doesn’t clearly define the target customer market in terms of age, interest, location, gender, and occupation. Without clarifying the details about your target customers, you won’t know anything about them. You can’t rightly target your customers if you don’t know about them.

Conclusion: Strengths and Weaknesses of a Business Plan Example  | SWOT Analysis of Business Plan

After an in-depth study of the strengths and weaknesses of a business plan example; we have realized that a business plan is a very important document. If you’re developing a business plan swot analysis example company, then you should keep in mind the abovementioned strong and weak points impacting the business plan.

Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. Other than that, he’s a fun loving person.

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Boston bruins strengths and weaknesses going into the 2024 nhl entry draft.

• June 28, 2024

Hazen Pierce

This offseason, General Manager Don Sweeney and the Boston Bruins are looking to rebound from their 2024 NHL Stanley Cup playoff second-round exit to the Florida Panthers . Boston has many holes that they are looking to fill this free agency. They also just announced the Linus Ullmark trade to the Ottawa Senators where Boston received the 25th overall pick. This is their only pick in the first three rounds of this year’s draft. Boston also brought back Jay Leach to be the team’s assistant coach . Boston will have a lot of impactful returns or new additions next season, while also having to upgrade their weaknesses during and after the 2024 NHL Draft. With Boston already making significant changes to their roster and staff, let’s dive into some of the organization’s strengths and weaknesses approaching the 2024 NHL Draft. 

The Boston Bruins Organizational Strengths Starts With Well-Rounded Coaching

The Boston Bruins have built a dominant and experienced staff behind their bench over the past three seasons. One of Sweeney’s first big moves this offseason was bringing back former Providence Bruins Head Coach Jay Leach. Leach will slide in well as the team’s assistant coach alongside Head Coach Jim Montgomery, who the team hired during the 2022 offseason after the departure of Bruce Cassidy. Montgomery won a National Championship in 2017 with the University of Denver. Since being hired by the Bruins, Montgomery has had an overall record of 112-32-20. Montgomery brings more of an up-tempo style to the lineup which overall fits how Boston plays the game.

Not only does Montgomery bring experience and a positive style to the organization, but so does assistant coaches Joe Sacco and Chris Kelly . Kelly started with little to no coaching experience in 2021 but has championship experience as a player winning a cup with Boston in 2011. He focuses a lot on the detail aspects of hockey, which allows the roster to play to their full potential. Sacco provides the Bruins with even more experience, considering he’s been on the staff since 2014. This staff overall fits the Bruins culture. They bring a ton of experience to the organization and are one of the team’s biggest strengths going into the offseason.

Salary Cap Room

The Bruins are entering an offseason where they have over $21 million in salary cap to spend. Maintaining enough salary to improve the team’s overall roster has been a recurring issue in the past couple of seasons. This offseason Don Sweeney will finally have some salary cap available to go out and land some big names to help with the team’s depth and missing pieces. Boston’s main goal is to bring back a championship team. Currently, Boston is in a comfortable position with more than $21 million in cap space. This will make it easier for the organization to target bigger pieces in free agency, which will improve the missing holes in the team’s lineup. 

Special Teams

Special teams have been a key cause of the Bruins success in recent years. Joe Sacco has been the main contributor to the team’s outstanding play while a man down. Because of his ability to shut down opposing teams’ powerplays, Jim Montgomery and the entire organization have a lot of confidence in Sacco and his penalty-kill strategy. Boston had an 82.5% penalty-kill percentage this season, which was top-5 in the league. Even though the B’s powerplay wasn’t at its best most of last season, they had a strong finish towards the end. The team boosted their powerplay percentage from 18.2% to 27.3%. 

Along With Strengths Comes Some Weaknesses for the Boston Bruins and First Up: The Prospect Pool

The Bruins have lacked high-valued draft picks over the years, causing them to have one of the worst prospect groups in the entire NHL. Boston has even gained a lot of attention over the years for lacking a deep prospect pool. Matthew Poitras and Mason Lohrei are the only Bruins prospects in the last four draft classes to have made their debuts in the NHL. The last star that was drafted by Boston was Jeremy Swayman in the 2017 NHL Draft. Overall, the Bruins haven’t had a deep prospect group for the last couple of years, as they’ve been focused on bringing in veterans to try and allow them to win right now. 

Speed was a major concern for the Boston Bruins forward core this season. The NHL is full of players with tremendous speed and skill, which the Bruins have lacked recently in their lineup. Speed is one of the most important attributes of a team in the playoffs. It was one of the main reasons the Bruins were incapable of competing past the first round. 

Inconsistent Scoring

Inconsistent goal-scoring has been another concern for the Bruins in past seasons, especially during this year’s playoff run. The team was able to spread out goal-scoring throughout their roster during the regular season. This was a major improvement from recent years. When the playoffs came around the goal-scoring became more inconsistent. Boston has shown over the years that they are a defensive-minded hockey club. However, the lack of inconsistent goal-scoring has affected the team’s overall playoff performance. 

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Identify — and Develop — Your Natural Strengths

• Sanyin Siang

Strategies for cultivating the skills that come easily to you, rather than focusing on the ones that don’t.

When we think of self-improvement, we tend to focus on our weaknesses. But that means we often underestimate our strengths — or even don’t recognize them at all. In this article, the author explains why we’ve developed this focus on weakness, and she then lays out a program for identifying and developing our strengths, with a particular focus on natural abilities that we might take for granted and therefore overlook.

“What is your biggest weakness?”

• Sanyin Siang is a CEO mentor and a professor at Duke University, where she leads the Coach K Leadership & Ethics Center at the Fuqua School of Business.

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This Used to Be a Major Weakness for Ford -- Now It's a Massive Strength

• Ford Pro's EBIT nearly doubled in the first quarter.
• Its margins dwarf the traditional Ford Blue business.
• Ford Pro will be key to offsetting massive EV losses.
• Motley Fool Issues Rare “All In” Buy Alert

Ford Motor Company

Ford's commercial business was once seen as a weakness, but that's far from the case today.

It's always nice when management at a major company such as Ford Motor Company ( F 0.99% ) can flip a weakness into a strength. Ford has done exactly that with its commercial business. It was once a black eye for the company as it sold fleets of vehicles to rental companies at razor-thin margins and, sometimes, losses.

Right now, Ford Pro, the company's commercial division, is thriving and even outproducing Ford's traditional business on the bottom line. Here's a look at how strong Ford Pro has become.

Zero to hero

What Ford Pro has accomplished is extremely impressive, especially when compared to Ford's other business divisions. These include Ford Blue, its traditional vehicle business, and Ford Model e, the company's electric-vehicle (EV) division.

While Ford Pro sold fewer wholesale units than Ford Blue, the difference in margins, growth, and bottom-line results are staggering. Ford Blue's sales declined 13% during the first quarter on 11% less wholesale revenue. Meanwhile, Ford Pro's wholesale revenue boomed 21% and its sales jumped 36% compared to the prior year.

But the impressive figures don't stop there. Ford Pro's earnings before interest and taxes (EBI T ) jumped $1.64 billion to over $3 billion during the first quarter, while Ford Blue generated only $905 million in EBIT. Those results were boosted largely by Ford Pro's better-than-expected margins, which checked in at nearly 17%, well ahead of the mid-teens that were expected and far ahead of Ford Blue's 4.2% EBIT margin.

Ford Pro's success couldn't come at a better time as the company's model e unit continues to bleed cash. In fact, the Ford model e lost over $1.3 billion in the first quarter alone on revenue that declined 84%, compared to the prior year.

What's driving Ford Pro?

Ford Pro achieved its results thanks to higher production of Super Duty trucks and Transit vans. More and more companies are looking to electrify their fleets, including the United States Postal Service, which anticipates buying roughly 9,250 E-Transit vans through the end of 2024.

What's more interesting is that over the past 12 months through the first quarter, roughly 13% of Ford Pro's EBIT came from software and physical services, including parts and accessories. It's well on its way to achieving 20% within a few years -- software subscriptions with commercial customers grew 43% year over year with more than 560,000 subscriptions during the first quarter.

Ford isn't resting on its laurels, either. It's growing its business in Europe and recently introduced a new extended range option for the E-Transit, which is expected to widen its potential customer base. Already, Ford owns the top-selling large EV van in Europe and outsold its nearest competitor by more than 5 to 1.

As Ford Pro and its services continue to add value and vehicle fleet insights for its customers, it's also adding awards to its cupboard. In the 19th annual Vincentric Best Fleet Value in America Awards, Ford Pro won eight awards, double the amount of any other brand.

What it all means

Ford Pro is booming and doing so with margins at levels its traditional automotive business can't reach. It's also hugely important that software service subscriptions continue to generate more and more revenue.

The company's commercial business is no longer a black eye for the company to fill production capacity but is a core strength, especially at a time when Ford anticipates losing $5.5 billion from its EV business in 2024. In other words, investors should be thrilled with its commercial business going from zero to hero and that expectations for the business are only moving higher .

Daniel Miller has positions in Ford Motor Company. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

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Why Zach Edey? Grizzlies GM Zach Kleiman explains first-round NBA draft choice

Memphis Grizzlies general manager Zach Kleiman didn't take long to clear the air Wednesday night after the team had selected 7-foot-4 Purdue center Zach Edey with the ninth overall pick in the 2024 NBA draft.

There were reports during the past couple of weeks of the Grizzlies possibly moving up to draft another big man, particularly UConn's Donovan Clingan. Despite all the reports, Kleiman feels strongly about the Grizzlies coming away with Edey on Wednesday.

"Let's just say this is exactly what we were hoping would happen," Kleiman said.

"When we talk about the DNA of this team and what we are trying to build out, Zach Edey to a T is that definition," Kleiman later added. "We could not be more thrilled to land him in this draft."

Edey, a four-year standout at Purdue, was the most accomplished center in the 2024 draft. He won both the Naismith and Wooden awards for the top collegiate player in his junior and senior seasons. His performance led to Purdue advancing to the national championship game his senior year.

Kleiman spoke with the media Wednesday night after the draft about why the Grizzlies are excited about their latest addition.

Inside the Grizzlies' comfort with Zach Edey

Edey first tested the NBA draft waters after his junior season, and that's when the Grizzlies first expressed interest in the collegiate standout. Memphis did its homework not only on how Edey would fit on the roster, but as well as coming to the city of Memphis.

"I think he understood both the cultural and encore fit," Kleiman said. "There was a lot of mutual excitement about him joining the Grizzlies."

Pairing Zach Edey with Jaren Jackson Jr., Ja Morant

Grizzlies stars Jaren Jackson Jr. and Ja Morant both posted their approvals of the Edey selection on social media, and Kleiman mentioned on Wednesday how the 7-4 center's fit alongside those two players is one of the reasons Memphis is excited.

Jackson thrived as a roam defender in the 2022 and 2023 seasons while being named to the all-defensive team in both years and winning Defensive Player of the Year in 2023. This past season, Jackson played more at center, which took him out of the roamer role. His blocked shots drastically dipped and he was not named as a member of the two all-defensive teams.

There are questions about Edey's ability to play in space defensively, but Kleiman talked about the chance to have Edey protecting the paint while Jackson thrives as a help defender.

"I think that's a look we're very comfortable with and I think Zach has the potential to be a very positive, impactful defender over time," Kleiman said.

Kleiman shared that Morant was thrilled with the selection. Offensively, Morant has always been at his best when he has a big body at center capable of setting screens and forcing defenses to make tough choices. Jonas Valanciunas and Steven Adams played that role before, and those are two players Edey has compared himself to previously.

"As a roll threat to the basket, Ja has a way of finding guys," Kleiman said. "My God, you've got some size for Ja to find now. That's a pairing that we're really excited about."

Zach Edey gives Grizzlies optionality advantage

The biggest takeaway from drafting Edey is that he gives the Grizzlies another option. Now, Memphis has players capable of matching up against different types of foes on any given night.

If they want to go small, they can put Jackson at center and play five out. If they're playing a bigger mobile team, the Grizzlies can sub Brandon Clarke in for Edey. When Memphis matches up against the more physical centers like Rudy Gobert, Nikola Jokic and Ivica Zubac, Edey will be relied on more.

"It's not easy to build a team that really can not just deal with different types of matchups, but what really appealed to us about Zach, you spend a lot of time trying to figure out how do we match up against this team, how do we match up against that team," Klieman said. "Zach is incredibly unique in that you got to deal with him. From a size standpoint, from a physicality standpoint, that's something other teams are going to have to grapple with. We want to have looks to throw out there that give us the advantage."

Damichael Cole is the Memphis Grizzlies beat writer for The Commercial Appeal. Contact Damichael at [email protected] . Follow Damichael on X, formerly known as Twitter, @DamichaelC.