Performing a SWOT analysis
SWOT stands for strengths, weaknesses, opportunities, and threats. This evaluation tool will help you gain a better understanding of your business and where it stands against competitors. The SWOT analysis can be used at many points during the business life cycle, but in the early stages it can help you evaluate your chance for successfully launching your business.
1. Write a list of your business’s strengths or perceived strengths:
- Do you hold a patent to a unique product or technology?
- Do you have a solid reputation in your industry?
- Can you offer the product or service at a lower price than other businesses?
Include any strengths that may set you apart from competitors or make it easier for you to enter the market
2. Make a list of your businesses weaknesses:
- Do you have limited financial resources to support your business?
- Are you lacking in industry experience?
- Do you have limited time to operate your business?
3. Write down opportunities in the external marketplace:
- Write down trends, regulations, demographic and customer factors that can work in your favor
- Generate a list of opportunities that can lead to business growth and profit
4. Examine threats in the external market that could impact your company:
- Are there similar or substitute products already offered? Substitute products are those that are an alternative to your product.
- Are the barriers to entering the market high? High entry barriers may include government regulations, high start-up costs, and strong customer loyalty to established companies.