Compania Cervecerias Unidas S.A. SWOT Analysis / Matrix

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SWOT analysis is a vital strategic planning tool that can be used by Compania Cervecerias Unidas S.A. managers to do a situational analysis of the company . It is a useful technique to analyze the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) Compania Cervecerias Unidas S.A. is facing in its current business environment.

The Compania Cervecerias Unidas S.A. is one of the leading organizatations in its industry. Compania Cervecerias Unidas S.A. maintains its dominant 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 Compania Cervecerias Unidas S.A. to develop four types of strategies:

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Compania Cervecerias Unidas S.A. swot analysis / matrix

SWOT Matrix Strategies Objective

The core purpose of SWOT matrix is to identify the strategies that a company can utilize to exploit external opportunities, counter threats, and build on & protect Compania Cervecerias Unidas S.A. strengths, and eradicate its weaknesses.

Step by Step Guide to Compania Cervecerias Unidas S.A. SWOT Analysis

Strengths of Compania Cervecerias Unidas S.A. – Internal Strategic Factors

As one of the leading companies in its industry, Compania Cervecerias Unidas S.A. 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 Compania Cervecerias Unidas S.A. are –

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  • Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
  • Successful track record of developing new products – product innovation.
  • 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.
  • 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.
  • Strong distribution network – Over the years Compania Cervecerias Unidas S.A. has built a reliable distribution network that can reach majority of its potential market.
  • Highly successful at Go To Market strategies for its products.
  • Highly skilled workforce through successful training and learning programs. Compania Cervecerias Unidas S.A. 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 – Compania Cervecerias Unidas S.A. has strong free cash flows that provide resources in the hand of the company to expand into new projects.

Weakness of Compania Cervecerias Unidas S.A. – Internal Strategic Factors

Weakness are the areas where Compania Cervecerias Unidas S.A. 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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  • Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, Compania Cervecerias Unidas S.A. 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.
  • 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.
  • High attrition rate in work force – compare to other organizations in the industry Compania Cervecerias Unidas S.A. has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
  • 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 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. Compania Cervecerias Unidas S.A. has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
  • The profitability ratio and Net Contribution % of Compania Cervecerias Unidas S.A. are below the industry average.
  • Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.

Opportunities for Compania Cervecerias Unidas S.A. – 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 Compania Cervecerias Unidas S.A. to drive home its advantage in new technology and gain market share in the new product category.
  • Government green drive also opens an opportunity for procurement of Compania Cervecerias Unidas S.A. products by the state as well as federal government contractors.
  • 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.
  • The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Compania Cervecerias Unidas S.A. to increase its profitability.
  • The market development will lead to dilution of competitor’s advantage and enable Compania Cervecerias Unidas S.A. to increase its competitiveness compare to the other competitors.
  • Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Compania Cervecerias Unidas S.A. an opportunity to enter a new emerging market.
  • Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Compania Cervecerias Unidas S.A..
  • 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 Compania Cervecerias Unidas S.A.. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.

Threats Compania Cervecerias Unidas S.A. Facing - External Strategic Factors

  • 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.
  • Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
  • 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.
  • 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 environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
  • Liability laws in different countries are different and Compania Cervecerias Unidas S.A. may be exposed to various liability claims given change in policies in those markets.
  • Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.

Limitations of SWOT Analysis for Compania Cervecerias Unidas S.A.

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 Compania Cervecerias Unidas S.A.
  • 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 Compania Cervecerias Unidas S.A.

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 Compania Cervecerias Unidas S.A. 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 Compania Cervecerias Unidas S.A.

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)