E2 Metals Limited SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a strategic planning tool that can be used by E2 Metals Limited managers to do a situational analysis of the firm . It is a useful technique to evalauate the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) E2 Metals Limited is facing in its current business environment.

The E2 Metals Limited is one of the leading companies in its industry. E2 Metals Limited 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 organization 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 E2 Metals 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 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 E2 Metals Limited strengths, and eradicate its weaknesses.

Step by Step Guide to E2 Metals Limited SWOT Analysis

Strengths of E2 Metals Limited – Internal Strategic Factors

As one of the leading firms in its industry, E2 Metals 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 E2 Metals Limited are –

Read - E2 Metals Limited Porter 5 Forces Analysis & Industry Analysis
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• Good Returns on Capital Expenditure – E2 Metals Limited is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
• Strong distribution network – Over the years E2 Metals Limited has built a reliable distribution network that can reach majority of its potential market.
• Highly skilled workforce through successful training and learning programs. E2 Metals 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.
• Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
• Strong Free Cash Flow – E2 Metals Limited has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• 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.
• Automation of activities brought consistency of quality to E2 Metals Limited products and has enabled the company to scale up and scale down based on the demand conditions in the market.
• Successful track record of developing new products – product innovation.

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Weakness of E2 Metals Limited – Internal Strategic Factors

Weakness are the areas where E2 Metals 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.

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• Limited success outside core business – Even though E2 Metals Limited 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.
• Not highly successful at integrating firms with different work culture. As mentioned earlier even though E2 Metals 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 E2 Metals Limited is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
• 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.
• Investment in Research and Development is below the fastest growing players in the industry. Even though E2 Metals 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.

Opportunities for E2 Metals Limited – External Strategic Factors

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• The new technology provides an opportunity to E2 Metals 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.
• Government green drive also opens an opportunity for procurement of E2 Metals Limited products by the state as well as federal government contractors.
• 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 E2 Metals Limited in other product categories.
• 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 E2 Metals 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.
• Decreasing cost of transportation because of lower shipping prices can also bring down the cost of E2 Metals 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.
• New trends in the consumer behavior can open up new market for the E2 Metals 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.
• Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided E2 Metals Limited an opportunity to enter a new emerging market.

Threats E2 Metals Limited Facing - External Strategic Factors

• Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
• Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
• 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.
• Liability laws in different countries are different and E2 Metals Limited may be exposed to various liability claims given change in policies in those markets.
• 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.
• Imitation of the counterfeit and low quality product is also a threat to E2 Metals Limited’s product especially in the emerging markets and low income markets.
• Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
• 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 E2 Metals 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 E2 Metals 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 E2 Metals 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 E2 Metals 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 E2 Metals 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

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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)