Donaco International Limited SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a strategic planning tool that can be used by Donaco International Limited managers to do a situational analysis of the company . It is an important technique to analyze the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) Donaco International Limited is facing in its current business environment.

The Donaco International Limited is one of the leading companies in its industry. Donaco International Limited maintains its dominant 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.

Order Now - Donaco International Limited SWOT Analysis
Check out- Donaco International Limited PESTEL / PEST & Environment Analysis
Article continues after advertisement

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 known as SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Donaco International Limited to develop four types of strategies:

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

Donaco International Limited swot analysis / matrix

SWOT Matrix Strategies Objective

The primary purpose of SWOT matrix is to identify the strategies that a company can use to exploit external opportunities, counter threats, and build on & protect Donaco International Limited strengths, and eradicate its weaknesses.

Step by Step Guide to Donaco International Limited SWOT Analysis

Strengths of Donaco International Limited – Internal Strategic Factors

As one of the leading organizations in its industry, Donaco International Limited 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 Donaco International Limited are –

Read - Donaco International Limited Porter 5 Forces Analysis & Industry Analysis
Article continues after advertisement

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.
Highly skilled workforce through successful training and learning programs. Donaco International Limited 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.
Strong Free Cash Flow – Donaco International Limited has strong free cash flows that provide resources in the hand of the company to expand into new projects.
Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
Strong Brand Portfolio – Over the years Donaco International Limited has invested in building a strong brand portfolio. The SWOT analysis of Donaco International Limited just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
Strong distribution network – Over the years Donaco International Limited has built a reliable distribution network that can reach majority of its potential market.
Successful track record of developing new products – product innovation.
Highly successful at Go To Market strategies for its products.

Weakness of Donaco International Limited – Internal Strategic Factors

Weakness are the areas where Donaco International Limited 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.

Article continues after advertisement

The profitability ratio and Net Contribution % of Donaco International Limited are below the industry average.
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 Donaco International Limited is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
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 Donaco International Limited
Not highly successful at integrating firms with different work culture. As mentioned earlier even though Donaco International Limited 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 Donaco International Limited 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.
High attrition rate in work force – compare to other organizations in the industry Donaco International Limited has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
Limited success outside core business – Even though Donaco International Limited is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.

Opportunities for Donaco International Limited – External Strategic Factors

Article continues after advertisement

Government green drive also opens an opportunity for procurement of Donaco International Limited products by the state as well as federal government contractors.
The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Donaco International Limited to increase its profitability.
New trends in the consumer behavior can open up new market for the Donaco International Limited . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
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 Donaco International Limited to drive home its advantage in new technology and gain market share in the new product category.
Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Donaco International Limited.
Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Donaco International Limited to capture new customers and increase its market share.
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 Donaco International Limited. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.
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 Donaco International Limited in other product categories.

Threats Donaco International Limited Facing - External Strategic Factors

New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
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.
Rising raw material can pose a threat to the Donaco International Limited profitability.
Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Donaco International Limited in those markets.
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.
New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
Imitation of the counterfeit and low quality product is also a threat to Donaco International Limited’s product especially in the emerging markets and low income markets.

Limitations of SWOT Analysis for Donaco International Limited

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 Donaco International Limited
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.

Article continues after advertisement

Weighted SWOT Analysis of Donaco International Limited

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 Donaco International Limited 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 Donaco International Limited

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.

Buy Custom Essay and Term Paper on SWOT Analysis / Matrix , Weighted SWOT Analysis of Donaco International Limited

Example of Weighted SWOT Analysis

You can email us to get an example document of Weighted SWOT analysis.

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)