Town Sports International Holdings, Inc. SWOT Analysis / Matrix

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

The Town Sports International Holdings, Inc. is one of the leading organizatations in its industry. Town Sports International Holdings, Inc. maintains its prominent position in market by carefully analyzing and reviewing the SWOT analysis.  SWOT analysis an immensenly interactive process and requires effective coordination among various departments within the company 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 called SWOT Matrix.

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

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Town Sports International Holdings, Inc. swot analysis / matrix

SWOT Matrix Strategies Objective

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

Step by Step Guide to Town Sports International Holdings, Inc. SWOT Analysis

Strengths of Town Sports International Holdings, Inc. – Internal Strategic Factors


As one of the leading firms in its industry, Town Sports International Holdings, 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 Town Sports International Holdings, Inc. are –


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  • Strong Free Cash Flow – Town Sports International Holdings, Inc. has strong free cash flows that provide resources in the hand of the company to expand into new projects.
  • Strong Brand Portfolio – Over the years Town Sports International Holdings, Inc. has invested in building a strong brand portfolio. The SWOT analysis of Town Sports International Holdings, Inc. just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
  • 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.
  • Highly skilled workforce through successful training and learning programs. Town Sports International Holdings, Inc. is investing huge resources in training and development of its employees resulting in a workforce that is not only highly skilled but also motivated to achieve more.
  • Superb Performance in New Markets – Town Sports International Holdings, Inc. has built expertise at entering new markets and making success of them. The expansion has helped the organization to build new revenue stream and diversify the economic cycle risk in the markets it operates in.
  • Strong distribution network – Over the years Town Sports International Holdings, Inc. has built a reliable distribution network that can reach majority of its potential market.
  • Successful track record of developing new products – product innovation.
  • 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.


Weakness of Town Sports International Holdings, Inc. – Internal Strategic Factors


Weakness are the areas where Town Sports International Holdings, Inc. can improve upon. Strategy is about making choices and weakness are the areas where an organization can improve using SWOT analysis and build on its competitive advantage and strategic positioning.


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  • The profitability ratio and Net Contribution % of Town Sports International Holdings, Inc. are below the industry average.
  • 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. Town Sports International Holdings, Inc. has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
  • Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
  • Not very good at product demand forecasting leading to higher rate of missed opportunities compare to its competitors. One of the reason why the days inventory is high compare to its competitors is that Town Sports International Holdings, Inc. is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
  • There are gaps in the product range sold by the company. This lack of choice can give a new competitor a foothold in the market.
  • Not highly successful at integrating firms with different work culture. As mentioned earlier even though Town Sports International Holdings, Inc. is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
  • Investment in Research and Development is below the fastest growing players in the industry. Even though Town Sports International Holdings, Inc. is spending above the industry average on Research and Development, it has not been able to compete with the leading players in the industry in terms of innovation. It has come across as a mature firm looking forward to bring out products based on tested features in the market.

Opportunities for Town Sports International Holdings, 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 Town Sports International Holdings, Inc. an opportunity to enter a new emerging market.
  • 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 Town Sports International Holdings, Inc. to drive home its advantage in new technology and gain market share in the new product category.
  • Stable free cash flow provides opportunities to invest in adjacent product segments. With more cash in bank the company can invest in new technologies as well as in new products segments. This should open a window of opportunity for Town Sports International Holdings, Inc. in other product categories.
  • Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Town Sports International Holdings, Inc..
  • Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Town Sports International Holdings, 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.
  • Government green drive also opens an opportunity for procurement of Town Sports International Holdings, Inc. products by the state as well as federal government contractors.
  • New trends in the consumer behavior can open up new market for the Town Sports International Holdings, Inc. . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
  • Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Town Sports International Holdings, Inc. to capture new customers and increase its market share.

Threats Town Sports International Holdings, Inc. Facing - External Strategic Factors

  • As the company is operating in numerous countries it is exposed to currency fluctuations especially given the volatile political climate in number of markets across the world.
  • Intense competition – Stable profitability has increased the number of players in the industry over last two years which has put downward pressure on not only profitability but also on overall sales.
  • 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.
  • Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Town Sports International Holdings, Inc.   in those markets.
  • Imitation of the counterfeit and low quality product is also a threat to Town Sports International Holdings, Inc.’s product especially in the emerging markets and low income markets.
  • Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
  • Rising raw material can pose a threat to the Town Sports International Holdings, Inc. profitability.
  • The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.

Limitations of SWOT Analysis for Town Sports International Holdings, 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 Town Sports International Holdings, 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 Town Sports International Holdings, 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 Town Sports International Holdings, 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 Town Sports International Holdings, 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

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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)