Doing a SWOT analysis is a potent way to evaluate your company and its competition. The term SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. It gives greater insight into a business and its products in a competitive environment. If you are a dealer (dealership), manufacturer, or similar business, you will benefit from using this tool to evaluate markets and improve strategic decisions.

In this article, you’ll learn about SWOT analysis. Learn tips and strategies for conducting a SWOT analysis for your organization. You’ll also see how you can use the data from a SWAT analysis to improve processes and gain a competitive advantage.

Strip Mining Equipment — SWOT Analysis helps you find & see the detail that’s critical for success.

What value does a SWOT analysis provide?

There are many reasons to do a SWOT analysis, and since it is a flexible tool, it is used for many purposes. What value can you get from doing a SWOT analysis? Here are some possible benefits.

Strategic Planning
Practicing evidence-based decision making
Identifying ways to overcome competition
Improved understanding of competitive advantages
Identify opportunities and threats in a changing market

Planning Tools - Why SWOT Analysis — SWOT Analysis can be a tool to assist with many different objectives.

The tool can be used to evaluate a specified project, issue, or situation. If you are working to improve Service Department Absorption or Consultative Selling SWOT analysis can be used to figure out what will be most effective for your organization.

What is a SWOT analysis?

It is an effective process to systematically identify and document Strengths, Weaknesses, Opportunities, and Threats. This tool can be used for many purposes within a business. Today we will focus on how to use it in developing a marketing strategy and improving specific aspects of business performance.

Businesses of all sizes use SWOT analysis and find it a useful tool to understand the company’s current status and how they can adapt to become more successful. In a recent project, it was determined to be an excellent tool to do an evaluation before the start of sales for a new product. This, in turn, helped us coach the sales team to not focus on selling features but instead value and solution selling after gaining a better understanding of the strengths and weaknesses of competitive manufacturers and their products.

SWOT provides a systematic approach that has been successful for organizations of all sizes and can be applied to any industry successfully. It has already been applied numerous times by dealerships and manufacturers with success.

What is the perspective of the SWOT analysis?

The analysis is done from two perspectives by definition. Strengths and Weaknesses are an internal look to understand the status of the organization. Opportunities and Threats look outward at the marketplace to understand external factors that could lead to success or failure.

Strengths + Weaknesses = Internal factors

Opportunities + Threats = External factors

Show me SWOT Analysis examples for dealerships and manufacturers?

Below are examples of what you may find in a SWOT Analysis done by a dealership or manufacturer. The issues in your analysis will be specific to your organization and what is vital for the business.

Strengths

This area focuses on what a company, organization, or project does well. Some examples of this could be:

A broader product line than 8 of 9 dealers in the area
Skilled technicians
High parts fill rate (>78%)

Weaknesses

This segment is a focus on gaps or challenges.to the organization that is hindering the team from meeting their goals. Some examples of this could be:

Availability of equipment to demo for customers
New technician training
Competitors able to offer better finance options

Opportunities

What are the situations where if your team acted on them, it would have a positive impact on the business? Often we are aware of opportunities, and this is the place to document them so that we can build a strategy and act on them. Here are some examples:

Listing rental fleet with BigRentz
Recruiting technicians from another industry
Installing dropboxes to reduce travel for customer and overhead for the business

Threats

The threat evaluation is also a vital element of a SWOT analysis. This section is where we focus on risks to the organization or meeting its goals. It should be more than just want keeps us up at night and include potential disruptions. These are illustrations of threats:

The new dealership location in town
Brand X just announced distribution in Canada
Staff infected by a virus

What questions do I ask?

The questions that can be asked during a SWOT analysis are not limited. Just think about the intent of the investigation. Here are a few examples of the types of questions that can be asked. In a future article, we will look at this in more detail.

Strengths:

What is the companies competitive advantage?
Do we have a unique selling proposition?
How extensive is our distribution network?
Do we have proprietary technology?

How well capitalized is the business?

Weaknesses:

Are there issues with the business location?
What are the most common objections from prospects?
Do employees lack any specific skills?

Are there any infrastructure (technology, equipment, facility) improvements needed?

Opportunities:

What are the weaknesses of competitors?
Are our markets changing in beneficial ways?
What changes in the industry could create opportunity?

Will changes in technology create opportunities?

Threats:

Our competitors changing in a way that could negatively impact the business?
Could regulations or political changes impact the business?
How could economic trends affect the business negatively?

Could changing demographics impact us negatively?

What can go wrong during the analysis?

There risks to SWOT analysis that can lead to poor results. First, it should never be done in a “vacuum.” What we mean is that the activity should not be limited to a few key executives expressing opinions in a conference room no matter how experienced they are. The team may believe that they fully understand the business’s internal operations and the market they serve; however, there will usually be gaps if a more enlightened approach is not taken.

Don't restrict communication, see, hear, speak during SWOT Analysis. — Look at your environment, encourage all input, document evidence, not feelings during SWOT Analysis.

SWOT: The politics of censoring

In most dealerships and manufacturers, there is a tendency to express positive thoughts about the business consistently. When evaluating weaknesses, staff frequently are uncomfortable talking about it or censor to avoid conflict. It is essential to be very specific about the weakness and be evidence-based even if it takes time to collect the evidence or data.

SWOT: Don’t let feelings get in the way

Remember that we all have biases. That bias impacts how we interpret the world around us. This interpretation of the world around us or feeling is different from impartial data or evidence. Use data where ever it is available. Remember, we don’t set our sales revenue for the month based on what we feel it should be but rather actual sales from customers.

SWOT: Competitive intelligence is critical

Never assume that you know all about your competitor. Most businesses are working hard to adapt every day. Most companies are not fully transparent about what they do to compete. Take the time to invest in competitive intelligence. Good insight into what your competitors are doing is critical in developing a strategy to compete against them. This information must be incorporated into the SWOT.

Summary

The gains from a proper SWOT analysis are usually immediately noticed and have a positive impact. It is a great way to move from a tactical problem-solving approach to a strategic plan that can deliver long-term gains. You could use SWOT analyses to evaluate the potential strengths and weaknesses of a marketing campaign, which projects to fund, or even whether your company should target specific customer groups.

Sometimes in businesses like dealerships and manufacturing, it becomes easy to assume that we already know everything about our company and the competition. The critical takeaway is that SWOT is a tool to help build a road map to greater success instead of just “fighting fires” and hoping to find your way to your goals.

The key to getting a return on investment for SWOT analysis is what is done with the insight gained. There should be a roadmap and time with actions to be taken based on the insight.

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