Use this free PDF to future-proof your business by identifying your strengths, weaknesses, opportunities, and threats. In short, everyone—whether you're launching a new product or run an established business—should do a SWOT analysis.
How to Examine Strengths and Weaknesses
Existing businesses should perform a SWOT analysis annually. Think of it as your annual State of the Business. Having it will allow you to keep your business running smoothly, anticipate problems, work on necessary changes or improvements, and make smarter decisions throughout the year. Basically—an annual SWOT analysis will keep you from losing touch with your business, customers, and industry. A SWOT analysis is far from scientific. It relies on your ability to observe and recall internal and external factors that can impact your business.
Heck, even your customers can provide valuable insight. You can either list strengths, weaknesses, opportunities, and threats together better for small teams or ask participants to create and submit lists individually better for bigger teams. Include everything that comes up in each category. Just write it all down. This is an opportunity for you and your team to ask questions that will determine how important each item on the list is.
Ask everyone in the group to choose their top three items for each category. Most likely, a pattern will emerge that will show you what to focus on. In this case, you are likely involved in all parts of the business and will have good insight into what you need to consider. Crack a bottle of wine or brew a pot of tea, and dig in! The following questions are here to help get things moving. I recommend reading through them no matter what to avoid missing important factors.
These are positive, internal factors that affect how your business performs. Although they may be difficult to change, they should be within your control:. These are negative, internal factors that affect how your business performs. These are external factors that could affect your business in a positive way. They may be largely out of your control, but you can choose to leverage them:.
Conducting a SWOT analysis
These are external factors that could affect your business in a negative way. Tough decisions about resource allocation are unavoidable. Start with the lists from your brainstorming session. Now work on narrowing down those lists so they will fit on a single page, arranged in a 2 x 2 SWOT matrix example below. What is less important now may become critical in the future, and you need to be aware of that possibility.
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You can always rearrange your list or come back to an item later. For each of the items on your final list, create a strategy to exploit the advantages and opportunities, and to deal with the weaknesses and threats.
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For now, just create a broad plan of action. Also, keep in mind that different factors can work together to balance each other out. How can you use your strengths to improve your weaknesses?
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How can you exploit opportunities to neutralize your threats? Can you leverage your strengths to better take advantage of opportunities? Is there a weakness you need to prioritize in order to prevent a threat? Here's a sample SWOT analysis template, based on an online tailored shirt business.
Marketing: Prepare a Situation Analysis
Although many more factors came up during brainstorming, these were deemed to be the most important. Think about what strategies this business owner could implement to take advantage of this information. Remember, there's no right or wrong answer here. The most important part of a SWOT analysis is how you use the information that comes out of it. Here are six sample scenarios with potential decisions to help you start thinking strategically. Scenario 1 : Your lease is nearing the end of its term and you need to renegotiate.
Since the neighborhood has gone up in value, you're worried you'll be priced out. Strategy : Start selling online to mitigate some of the risk. It was updated in Our SWOT challenge was designed to give entrepreneurs a look at their business. Once you have completed your SWOT analysis, here's how to proceed. Was this article helpful? Starting or Growing a Business?
SWOT Analysis: What Is It and How Does It Help Your Business?
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