Transmontaigne Partners L.P. SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Transmontaigne Partners L.P. is one of the leading companies in its industry. Transmontaigne Partners L.P. 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 company such as – marketing, finance, operations, management information systems and strategic planning.

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The SWOT Analysis framework enables 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 Transmontaigne Partners L.P. to develop four types of strategies:

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Transmontaigne Partners L.P. swot analysis / matrix

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 Transmontaigne Partners L.P. strengths, and eradicate its weaknesses.

Step by Step Guide to Transmontaigne Partners L.P. SWOT Analysis

Strengths of Transmontaigne Partners L.P. – Internal Strategic Factors

As one of the leading companies in its industry, Transmontaigne Partners L.P. 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 Transmontaigne Partners L.P. are –

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  • Strong distribution network – Over the years Transmontaigne Partners L.P. has built a reliable distribution network that can reach majority of its potential market.
  • Superb Performance in New Markets – Transmontaigne Partners L.P. 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.
  • 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.
  • Good Returns on Capital Expenditure – Transmontaigne Partners L.P. is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
  • Strong Brand Portfolio – Over the years Transmontaigne Partners L.P. has invested in building a strong brand portfolio. The SWOT analysis of Transmontaigne Partners L.P. 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.
  • Automation of activities brought consistency of quality to Transmontaigne Partners L.P. products and has enabled the company to scale up and scale down based on the demand conditions in the market.
  • 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 Transmontaigne Partners L.P. – Internal Strategic Factors

Weakness are the areas where Transmontaigne Partners L.P. 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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  • Limited success outside core business – Even though Transmontaigne Partners L.P. is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
  • The profitability ratio and Net Contribution % of Transmontaigne Partners L.P. are below the industry average.
  • 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.
  • 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.
  • 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.
  • Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
  • Not highly successful at integrating firms with different work culture. As mentioned earlier even though Transmontaigne Partners L.P. is successful at integrating small companies it has its share of failure to merge firms that have different work culture.

Opportunities for Transmontaigne Partners L.P. – External Strategic Factors

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  • 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 Transmontaigne Partners L.P. to drive home its advantage in new technology and gain market share in the new product category.
  • The market development will lead to dilution of competitor’s advantage and enable Transmontaigne Partners L.P. to increase its competitiveness compare to the other competitors.
  • Government green drive also opens an opportunity for procurement of Transmontaigne Partners L.P. products by the state as well as federal government contractors.
  • Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Transmontaigne Partners L.P. an opportunity to enter a new emerging market.
  • New trends in the consumer behavior can open up new market for the Transmontaigne Partners L.P. . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
  • The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Transmontaigne Partners L.P. to increase its profitability.
  • 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.
  • Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Transmontaigne Partners L.P. to capture new customers and increase its market share.

Threats Transmontaigne Partners L.P. Facing - External Strategic Factors

  • 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.
  • New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
  • Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Transmontaigne Partners L.P.
  • Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
  • The demand of the highly profitable products is seasonal in nature and any unlikely event during the peak season may impact the profitability of the company in short to medium term.
  • Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
  • 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.
  • 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 Transmontaigne Partners L.P.

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 Transmontaigne Partners L.P.
  • 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 Transmontaigne Partners L.P.

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 Transmontaigne Partners L.P. 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 Transmontaigne Partners L.P.

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)