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Swot Analysis

SWOT Analysis: The Spot



The purpose of starting a business is to provide services or goods and succeed. The success of a business is dependent on several factors one of which is planning. A business must be able to plan for the complex ever-changing environment it is involved in. A SWOT analysis is useful in helping a business plan for success. A SWOT analysis identifies a business’ strengths, weaknesses, opportunities, and threats; it can also help a business develop its strengths, overturn weaknesses, make the most of opportunities, identify and defend against vulnerabilities, and rise above threats. With a SWOT analysis a business can look at its current position, have a general idea of its future and make plans to improve its ability to reach its goals. SWOT identifies internal (strengths and weaknesses) and external (opportunities and threats) factors which affect a business. Some of the internal factors that can contribute to or hinder a business’ success are the business structure, business culture, products or services lineup, use of resource, customers, and shareholders (SWOT Analysis, 2009). On the other hand, some external factors include the community and change in the community, economic development, industry changes, political events, and legal policies (SWOT Analysis, 2009).
SWOT uses all four aspects to create and implement an effective business strategy. For instance, to identify strengths a company must find the areas in which they surpass the competition. Some of the questions that can be asked to identify strengths are where does the company stand in the current market? What does the company do better than the rest? Does the company have a clear plan? To address weaknesses a company will need to assess its disadvantages by asking questions like what does the company do inadequately? What practices should the company avoid? How is the company’s cash flow and debt? What areas can the company improve? Opportunities are always present it...