TravelCenters of America LLC SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a vital strategic planning tool that can be used by TravelCenters of America LLC managers to do a situational analysis of the organization . It is a handy technique to map out the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) TravelCenters of America LLC is facing in its current business environment.

The TravelCenters of America LLC is one of the leading firms in its industry. TravelCenters of America LLC 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 organization such as – marketing, finance, operations, management information systems and strategic planning.


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The SWOT Analysis framework facilitates 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 TravelCenters of America LLC 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 TravelCenters of America LLC strengths, and eradicate its weaknesses.

Step by Step Guide to TravelCenters of America LLC SWOT Analysis

Strengths of TravelCenters of America LLC – Internal Strategic Factors

As one of the leading organizations in its industry, TravelCenters of America LLC has numerous strengths that help 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 TravelCenters of America LLC are –

Read - TravelCenters of America LLC Porter 5 Forces Analysis & Industry Analysis
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• 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.
• Superb Performance in New Markets – TravelCenters of America LLC 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.
• Successful track record of developing new products – product innovation.
• Strong Free Cash Flow – TravelCenters of America LLC has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• Highly successful at Go To Market strategies for its products.
• Strong Brand Portfolio – Over the years TravelCenters of America LLC has invested in building a strong brand portfolio. The SWOT analysis of TravelCenters of America LLC just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
• Good Returns on Capital Expenditure – TravelCenters of America LLC is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
• Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.

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Weakness of TravelCenters of America LLC – Internal Strategic Factors

Weakness are the areas where TravelCenters of America LLC 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 TravelCenters of America LLC
• 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.
• 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.
• Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, TravelCenters of America LLC needs to put more money in technology to integrate the processes across the board. Right now the investment in technologies is not at par with the vision of the company.
• The profitability ratio and Net Contribution % of TravelCenters of America LLC are below the industry average.
• Limited success outside core business – Even though TravelCenters of America LLC is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.

Opportunities for TravelCenters of America LLC – 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 TravelCenters of America LLC an opportunity to enter a new emerging market.
• 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.
• New trends in the consumer behavior can open up new market for the TravelCenters of America LLC . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
• Decreasing cost of transportation because of lower shipping prices can also bring down the cost of TravelCenters of America LLC’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.
• 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 TravelCenters of America LLC in other product categories.
• The new technology provides an opportunity to TravelCenters of America LLC to practices differentiated pricing strategy in the new market. It will enable the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
• Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of TravelCenters of America LLC.
• Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for TravelCenters of America LLC to capture new customers and increase its market share.

Threats TravelCenters of America LLC Facing - External Strategic Factors

• 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.
• Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of TravelCenters of America LLC
• Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
• The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
• Imitation of the counterfeit and low quality product is also a threat to TravelCenters of America LLC’s product especially in the emerging markets and low income markets.
• Rising raw material can pose a threat to the TravelCenters of America LLC profitability.
• Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for TravelCenters of America LLC   in those markets.
• Liability laws in different countries are different and TravelCenters of America LLC may be exposed to various liability claims given change in policies in those markets.

Limitations of SWOT Analysis for TravelCenters of America LLC

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 TravelCenters of America LLC
• 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 TravelCenters of America LLC

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 TravelCenters of America LLC 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 TravelCenters of America LLC

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)