Could you use help identifying your key areas for growth in the upcoming year?
As small business owners, it's easy to get caught up in the daily tasks required to manage a business. That's why I like to leverage tools that are simple to use, but worth the effort to help keep your business on track.
One such tool is the S.W.O.T. analysis. Developing a S.W.O.T. analysis will help you think through your key opportunities and potential weaknesses. This technique can be applied to a wide range of scenarios, not just as an overview of your business. You could also use a S.W.O.T. analysis to evaluate new products, services, campaigns, sales, and more.
We'll walk through the basics of a S.W.O.T. analysis. I also provide a free template at the end to get you started.
What is a S.W.O.T. Analysis?
S.W.O.T. analysis stands for Strengths, Weaknesses, Opportunities, and Threats. The tool allows you to identify what your company does well, where it could improve, and the opportunities and threats facing your business.
As you can see in the image below, under strengths you should list what your company does well. Include competitive advantages such as strong brand recognition, customer loyalty, quality products, etc.
Next, list out your weaknesses. These should be areas you are lacking specific to competitors, resource limitations, inconsistent product messaging, etc.
The third category is opportunities. These are your key areas for growth. Let's say there is a competitor exiting your market, expected decreases in regulations or additional investment funds available, these would be good examples of key areas you could expand your business.
Lastly, outline the threats to your business. These should include key risks due to increased competition, regulations, financial, etc. Certainly over the past year, there were large risks due to the global factors from the pandemic and political changes.
There may be some overlap between your opportunities and threats. For example, expected trends that could increase the demand for your product could also increase competition. Taking the time to identify these types of situations could help you take advantage of an opportunity while reducing a threat at the same time.
DOWNLOAD the above FREE template here!
Once you develop your S.W.O.T. analysis, you should leverage the insights to outline your key sales and marketing tactics to take advantage of your strengths, improve where you have weaknesses, minimize impacts from risks and threats.
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