Coworking culinaire pour entrepreneurs & gourmands qui ont faim de changement | Culinary coworking for entrepreneurs & foodies hungry for change

Jul 28, 2016

The SWOT Analysis of your Business: A Complete Guide

Part of your marketing plan is doing a SWOT analysis. It’s a business tool that helps you deal with the external and internal factors of your business. But what in the world does SWOT stand for? It’s an abbreviation for Strengths, Weaknesses, Opportunities, and Threats. Important: Avoid listing factors for the sake of listing factors: only keep the essential ones.

Strengths

The strengths of your business are the positive factors that are under your control. They may be tangible or intangible, and you can evaluate them by areas of expertise (such as marketing, manufacturing, or business model, for example). Also worth noting is that strengths are factors that give you an advantage over your competitors, and not something that both you and your competitors are capable of doing (i.e. high quality products). A few examples of strengths include the founder’s experience, the fundraising that you have, or the validation of your idea that has been done.

Here are some questions to ask yourself while figuring out the strengths of your business:

How does myself as an entrepreneur and my team favor the success of my business?
What advantages does my business have over the competition?
What does the people in the market see as our strengths?
What do I do better than anyone else?
What makes my business have potential for a healthy growth?

Weaknesses

Now, the weaknesses. These are the negative factors of your business that are also under your control. Don’t lie to yourself and be honest! It’s better to point out your weaknesses now than someone else (i.e. investor or mentor) pointing them out for you. Examples of weaknesses could be a lack of expertise (i.e. marketing, web development), lack of financial resources, or poor location.

Some questions to ask yourself for finding the weaknesses of your business:

What areas of our business needs improvement?
What factors may make us lose sales or customers?
What does people in the market may see as our weaknesses?

Opportunities

These are the external factors that are beyond your control, but may positively impact your business. These might include changes in consumer attitudes, perceptions or habits. For example, an increase in popularity for the vegan lifestyle is an opportunity for a vegan product business. Now, it’s important to not mix up the opportunities with strengths, as strengths are positive factors of your business that you can control. On the other hand, you cannot control a change in consumer attitude, making it therefore an opportunity!

Questions you might ask yourself for the opportunities of your business:

Are there any changes in lifestyle or trends that may favor your business?
Are there any changes in government regulation or policies that may favor your business?
Are there any changes in the market or technology that may favor your business?

Threats

Finally, these are the work of the devil that you must fear the most! They are the negative aspects of your business that you have no control over and that can put your business at risk. A threat is basically a challenge that is created by an unfavorable trend or situation. Examples of threats are your (potential) competitors , governmental regulation, a shift in consumer behavior.

Questions you can ask yourself for the threats to your business:

What are my competitors doing?
Is changing consumer behavior threatening my business?
Is there a potential technology or factor that can make my business become obsolete?

Here’s an example of our founder’s previous business SWOT analysis. It’s not a perfect example obviously, but it’s something you can use to get inspired and better your understanding.