Treasury Wine Estates Limited SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Treasury Wine Estates Limited is one of the leading companies in its industry. Treasury Wine Estates 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.


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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 helps the managers of the Treasury Wine Estates Limited 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 main purpose of SWOT matrix is to identify the strategies that an organization can utilize to exploit external opportunities, counter threats, and build on & protect Treasury Wine Estates Limited strengths, and eradicate its weaknesses.

Step by Step Guide to Treasury Wine Estates Limited SWOT Analysis

Strengths of Treasury Wine Estates Limited – Internal Strategic Factors

As one of the leading organizations in its industry, Treasury Wine Estates Limited 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 Treasury Wine Estates Limited are –

Read - Treasury Wine Estates Limited Porter 5 Forces Analysis & Industry Analysis
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• Superb Performance in New Markets – Treasury Wine Estates Limited 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 Brand Portfolio – Over the years Treasury Wine Estates Limited has invested in building a strong brand portfolio. The SWOT analysis of Treasury Wine Estates Limited 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 – Treasury Wine Estates Limited is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
• Successful track record of developing new products – product innovation.
• Automation of activities brought consistency of quality to Treasury Wine Estates Limited products and has enabled the company to scale up and scale down based on the demand conditions in the market.
• Highly successful at Go To Market strategies for its products.
• 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. Treasury Wine Estates 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.

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Weakness of Treasury Wine Estates Limited – Internal Strategic Factors

Weakness are the areas where Treasury Wine Estates Limited 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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• High attrition rate in work force – compare to other organizations in the industry Treasury Wine Estates Limited has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
• The profitability ratio and Net Contribution % of Treasury Wine Estates Limited are below the industry average.
• Not highly successful at integrating firms with different work culture. As mentioned earlier even though Treasury Wine Estates Limited is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
• 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 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 Treasury Wine Estates Limited is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
• Limited success outside core business – Even though Treasury Wine Estates Limited is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• 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. Treasury Wine Estates Limited has to build internal feedback mechanism directly from sales team on ground to counter these challenges.

Opportunities for Treasury Wine Estates Limited – External Strategic Factors

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• Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Treasury Wine Estates Limited.
• 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 Treasury Wine Estates Limited to drive home its advantage in new technology and gain market share in the new product category.
• New trends in the consumer behavior can open up new market for the Treasury Wine Estates Limited . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
• 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.
• Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Treasury Wine Estates Limited’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.
• The new technology provides an opportunity to Treasury Wine Estates Limited 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.
• The market development will lead to dilution of competitor’s advantage and enable Treasury Wine Estates Limited to increase its competitiveness compare to the other competitors.
• 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 Treasury Wine Estates Limited in other product categories.

Threats Treasury Wine Estates Limited Facing - External Strategic Factors

• Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
• Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Treasury Wine Estates Limited
• Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
• Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Treasury Wine Estates Limited   in those markets.
• The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
• Rising raw material can pose a threat to the Treasury Wine Estates Limited profitability.
• Imitation of the counterfeit and low quality product is also a threat to Treasury Wine Estates Limited’s product especially in the emerging markets and low income markets.
• New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .

Limitations of SWOT Analysis for Treasury Wine Estates 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 Treasury Wine Estates 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.

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Weighted SWOT Analysis of Treasury Wine Estates 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 Treasury Wine Estates 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 Treasury Wine Estates 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.

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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)