LiqTech International, Inc. SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a vital strategic planning tool that can be used by LiqTech International, Inc. managers to do a situational analysis of the organization . It is a useful technique to evalauate the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) LiqTech International, Inc. is facing in its current business environment.

The LiqTech International, Inc. is one of the leading firms in its industry. LiqTech International, Inc. maintains its prominent position in market by critically analyzing and reviewing the SWOT analysis.  SWOT analysis an immensenly interactive process and requires effective coordination among various departments within the organization such as – marketing, finance, operations, management information systems and strategic planning.


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The SWOT Analysis framework helps an organization to identify the internal strategic factors such as -strengths and weaknesses, & external strategic factors such as - opportunities and threats. It leads to a 2X2 matrix – also known as SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix helps the managers of the LiqTech International, Inc. to develop four types of strategies:

• SO (strengths-opportunities) Strategies
• WO (weaknesses-opportunities) Strategies
• ST (strengths-threats) Strategies
•  WT (weaknesses-threats) Strategies

SWOT Matrix Strategies Objective

The core purpose of SWOT matrix is to identify the strategies that an organization can utilize to exploit external opportunities, counter threats, and build on & protect LiqTech International, Inc. strengths, and eradicate its weaknesses.

Step by Step Guide to LiqTech International, Inc. SWOT Analysis

Strengths of LiqTech International, Inc. – Internal Strategic Factors

As one of the leading organizations in its industry, LiqTech International, Inc. has numerous strengths that enable it to thrive in the market place. These strengths not only help it to protect the market share in existing markets but also help in penetrating new markets. Based on Fern Fort University extensive research – some of the strengths of LiqTech International, Inc. are –

Read - LiqTech International, Inc. Porter 5 Forces Analysis & Industry Analysis
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• Strong distribution network – Over the years LiqTech International, Inc. has built a reliable distribution network that can reach majority of its potential market.
• Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
• Strong dealer community – It has built a culture among distributor & dealers where the dealers not only promote company’s products but also invest in training the sales team to explain to the customer how he/she can extract the maximum benefits out of the products.
• High level of customer satisfaction – the company with its dedicated customer relationship management department has able to achieve a high level of customer satisfaction among present customers and good brand equity among the potential customers.
• Strong Brand Portfolio – Over the years LiqTech International, Inc. has invested in building a strong brand portfolio. The SWOT analysis of LiqTech International, Inc. just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
• Strong Free Cash Flow – LiqTech International, Inc. has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• Successful track record of integrating complimentary firms through mergers & acquisition. It has successfully integrated number of technology companies in the past few years to streamline its operations and to build a reliable supply chain.
• Automation of activities brought consistency of quality to LiqTech International, Inc. products and has enabled the company to scale up and scale down based on the demand conditions in the market.

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Weakness of LiqTech International, Inc. – Internal Strategic Factors

Weakness are the areas where LiqTech International, Inc. can improve upon. Strategy is about making choices and weakness are the areas where a firm can improve using SWOT analysis and build on its competitive advantage and strategic positioning.

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• Days inventory is high compare to the competitors – making the company raise more capital to invest in the channel. This can impact the long term growth of LiqTech International, Inc.
• Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
• Financial planning is not done properly and efficiently. The current asset ratio and liquid asset ratios suggest that the company can use the cash more efficiently than what it is doing at present.
• Limited success outside core business – Even though LiqTech International, Inc. is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• The marketing of the products left a lot to be desired. Even though the product is a success in terms of sale but its positioning and unique selling proposition is not clearly defined which can lead to the attacks in this segment from the competitors.
• The company has not being able to tackle the challenges present by the new entrants in the segment and has lost small market share in the niche categories. LiqTech International, Inc. has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
• High attrition rate in work force – compare to other organizations in the industry LiqTech International, Inc. has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.

Opportunities for LiqTech International, Inc. – External Strategic Factors

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• Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided LiqTech International, Inc. an opportunity to enter a new emerging market.
• The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as LiqTech International, Inc. to increase its profitability.
• New environmental policies – The new opportunities will create a level playing field for all the players in the industry. It represent a great opportunity for LiqTech International, Inc. to drive home its advantage in new technology and gain market share in the new product category.
• Organization’s core competencies can be a success in similar other products field. A comparative example could be - GE healthcare research helped it in developing better Oil drilling machines.
• The market development will lead to dilution of competitor’s advantage and enable LiqTech International, Inc. to increase its competitiveness compare to the other competitors.
• Decreasing cost of transportation because of lower shipping prices can also bring down the cost of LiqTech International, Inc.’s products thus providing an opportunity to the company - either to boost its profitability or pass on the benefits to the customers to gain market share.
• New trends in the consumer behavior can open up new market for the LiqTech International, Inc. . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
• New customers from online channel – Over the past few years the company has invested vast sum of money into the online platform. This investment has opened new sales channel for LiqTech International, Inc.. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.

Threats LiqTech International, Inc. Facing - External Strategic Factors

• Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of LiqTech International, Inc.
• Rising raw material can pose a threat to the LiqTech International, Inc. profitability.
• New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
• No regular supply of innovative products – Over the years the company has developed numerous products but those are often response to the development by other players. Secondly the supply of new products is not regular thus leading to high and low swings in the sales number over period of time.
• Liability laws in different countries are different and LiqTech International, Inc. may be exposed to various liability claims given change in policies in those markets.
• Imitation of the counterfeit and low quality product is also a threat to LiqTech International, Inc.’s product especially in the emerging markets and low income markets.
• Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for LiqTech International, Inc.   in those markets.
• New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.

Limitations of SWOT Analysis for LiqTech International, Inc.

Although the SWOT analysis is widely used as a strategic planning tool, the analysis does have its share of limitations.

• Certain capabilities or factors of an organization can be both a strength and weakness at the same time. This is one of the major limitations of SWOT analysis . For example changing environmental regulations can be both a threat to company it can also be an opportunity in a sense that it will enable the company to be on a level playing field or at advantage to competitors if it able to develop the products faster than the competitors.
• SWOT does not show how to achieve a competitive advantage, so it must not be an end in itself.
• The matrix is only a starting point for a discussion on how proposed strategies could be implemented. It provided an evaluation window but not an implementation plan based on strategic competitiveness of LiqTech International, Inc.
• SWOT is a static assessment - analysis of status quo with few prospective changes. As circumstances, capabilities, threats, and strategies change, the dynamics of a competitive environment may not be revealed in a single matrix.
• SWOT analysis may lead the firm to overemphasize a single internal or external factor in formulating strategies. There are interrelationships among the key internal and external factors that SWOT does not reveal that may be important in devising strategies.

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Weighted SWOT Analysis of LiqTech International, Inc.

In light of the above mentioned limitations of the SWOT analysis / matrix, corporate managers decided to provide weightage to each internal strength and weakness of the firm. Organizations also assess the likelihood of events taking place in the coming future and how strong their impact could be on company's performance.

This method is called Weighted SWOT analysis. It is better than doing simplistic SWOT analysis because with Weighted SWOT Analysis LiqTech International, Inc. managers can focus on the most critical factors and discount the non-important one. It also solves the long list problem where organizations ends up making a long list but none of the factors deemed too critical.

Limitation of Weighted SWOT analysis of LiqTech International, Inc.

This approach also suffers from one major drawback - it focus on individual importance of factor rather than how they are collectively important and impact the business holistically.

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Example of Weighted SWOT Analysis

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SWOT Worksheet & Template

If you like to do your own SWOT analysis or want to make your own Weighted SWOT SWOT matrix then feel free to download Fern Fort University SWOT Analysis Template.

References / Citations & Bibliography

• M. E. Porter, Competitive Strategy(New York: Free Press, 1980)
• A. D. Chandler, Strategy and Structure (Cambridge, Mass.: MIT Press, 1962)
• O. E. Williamson, Markets and Hierarchies(New York: Free Press, 1975);
• L. Wrigley, Divisional Autonomy and Diversification (PhD, Harvard Business School, 1970)
• R. E. White, Generic Business Strategies, Organizational Context and Performance: An Empirical Investigation, Strategic Management Journal7 (1986)