SWOT AND TOWS Analysis FOR AEON PDF

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SWOT AND TOWS ANALYSIS FOR AEONSWOT Analysis is Strength, Weakness, Opportunities and Threat Analysis. It is used to identify the internal and external factors relevant to the achievement of the objective of the organization. Strengths are characteristics of the organization that give it advantage o...

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SWOT AND TOWS ANALYSIS FOR AEON SWOT Analysis is Strength, Weakness, Opportunities and Threat Analysis. It is used to identify the internal and external factors relevant to the achievement of the objective of the organization. Strengths are characteristics of the organization that give it advantage over the others. Weaknesses are characteristics that puts the organization at a disadvantage over the others. Opportunities are elements in the environment that the organization can exploit for its advantage. Threats are elements in the environment that could cause trouble for the organization. SWOT matrix is a planning tools, whereas TOWS matrix is an action tool. Firstly we use SWOT analysis to identify the strength, weaknesses, opportunities and threats in a company, and then we use TOWS analysis to work out how our SWOT findings can be applied to future strategy. The TOWS Matrix helps Aeon’s businesses to identify their strategic options. An organisation gets the opportunity to make the most of its strengths and get around its internal weaknesses and learn to deal with them properly. Externally, an organisation learns to carefully look for market opportunities and recognise possibilities. And learn how to control and overcome potential threats. The TOWS Matrix can also help with brainstorming and developing great ideas to generate effective marketing strategies and tactics. Furthermore, the model goes beyond merely finding out the strengths and weaknesses within an organisation and what opportunities and threats there are in its environment. It forces organisations to really think about how they can improve themselves, how they can guard against threats and become more aware of their expertise and potential shortcomings. Aeon is one of the leading organizations in its industry. The result of SWOT analysis is very important for Aeon as it provides information in the planning stages in designing strategies to achieve the objective. The appropriateness of these strategies are weighed on whether the identified objective is attainable or not. If the current objective is not attainable, Aeon managers can select new objective and repeat the process. SWOT analysis a highly interactive process and requires effective coordination among various departments within the company such as, marketing, finance, operations, management information systems and strategic planning.

SWOT Analysis of Aeon Strengths of Aeon

1. Distribution and Reach: Aeon has a large number of outlets in almost every state, supported by a strong distribution network that makes sure that its products are available easily to a large number of customers in a timely manner. 2. Cost Structure: Aeon’s low cost structure helps it produce at a low cost and sell its products at a low price, making it affordable for its customers. 3. Dealer Community: Aeon has a strong relationship with its dealers that not only provide them with supplies but also focus on promoting the company’s products and training. 4. Financial Position: Aeon has a strong financial position with consecutive profits in the past 5 years, along with accumulated profit reserves that can be used to finance future capital expenditures. 5. Has a large asset base, which provides it with better solvency. 6. Skilled Labour force: Aeon has invest extensively in the training of its employees that has resulted in it employing a large number of skilled and motivated employees. 7. Has a diversified workforce, with people of many geographical, racial, culture and educational background that help the company by bringing diverse ideas and methodologies of doing things. 8. Has qualified and accredited professionals working under in its team. 9. Entering new markets: Aeon’s innovative teams have allowed it come up with new products and enter new markets. It has been successful in past, in most of the initiatives it has taken in new markets. 10. Social Media: Aeon has a strong presence on social media with more than millions of followers on the three most famous social media platforms such as Facebook, Twitter and Instagram. It has high level of customer engagement on these platforms with low customer response time. 11. Website: Aeon has a well-functioning and interactive website that draws a large number of internet traffic and sales.

12. The geography and location of Aeon provide it with a cost advantage in serving its customers, when compared to that with the competition. 13. Aeon has a well established IT system that ensures efficiency in its internal and external operations. 14. Aeon is a brand that has been in the market for years, and people are aware of it. This makes its brand awareness high. 15. Its products have maintained quality over the years and are still valued by customers, who find it as good value for the amount of money that they pay. 16. Partnership: Strategic partnerships are established by Aeon with its suppliers, dealers, retailers and other stakeholders. This allows it to leverage them if need be in the future. Weaknesses of Aeon 1. Research and Development: Even though Aeon is spending more than the average research and development expenditure within the industry, it is spending way less than a few players within the industry that have had a significant advantage as a result of their innovative products. 2. High Day Sales Inventory: The time it takes for products to be purchased and sold are higher than the industry average, meaning that builds up on inventory adding unnecessary costs to the business. 3. Rented Property: A significant proportion of the property that Aeon owns is rented rather than purchased. It has to pay large amount of rent on these adding to its costs. 4. The company has low levels of current assets compared to current liabilities, and this can create liquidity problems for it in operations. 5. Cash flow problems: There is a lack of proper financial planning at Aeon regarding cash flows, leading to certain circumstances where there isn’t enough cash flow as required leading to unnecessary unplanned borrowing.

6. Integration: Aeon’s current structure and culture have resulted in the failure of various mergers aimed at vertical integration. 7. Diversification in the workforce: The workforce at Aeon is concentrated with mostly local workers, and low amounts of workers from other racial backgrounds. Lack of diversification makes it difficult for employees from different racial background to adjust at the workplace, leading to loss of talent. 8. Market Research: Aeon has not conducted market research within the market that is serves since the past 2 years. As a result, it is making decisions based on 2 years old data, while customer needs may have evolved over time. 9. Quality Control: Aeon has a lower budget for its quality control department than competitors. This leads to lack of consistency and the possibility of damage to quality across its various outlets. 10. Lack of legal experience and legal department employees are not highly qualified. 11. The workload is a high per worker as there are fewer workers than the actual work required. This puts workers under psychological stress and is likely to be less productive. 12. Competition and qualified employees have been leaving the organization in recent years, which could mean a shortage of good talent for the company in the upcoming years. 13. The decision making is highly centralized, and decisions by teams need to be approved by certain officials. This reduces efficiency in operations by making them more time consuming. It also leads to reduced innovation. Opportunities of Aeon 1. Internet: There has been an increase in the number of internet users all over the world. This means that there is an opportunity for to expand their presence online by using the internet to interact with its customers.

2. E-commerce: There has been a new trend and a growth in sales of the e-commerce industry. This means that a lot of people are now making purchases online. Aeon can earn revenue by opening online stores and making sales through these. 3. Social Media: There has been an increase in the number of social media users worldwide. The three social media platforms which are Facebook, Twitter and Instagram, have shown the greatest number of increase in monthly active users. Aeon can use media to promote its products, interact with customers and collect feedback from them. 4. There has been an increase in average household income along with an increase in consumer spending following the recession. This will result in growth in Aeon’s target market with new customers that can be attracted towards the business. 5. Population; The population has been growing and is expected to grow at a positive rate for the upcoming years. This is beneficial for Aeon as there will be an increase in the number of potential customers that it can target. 6. Interest rate: Lower interest rates than compared to previous years provides an opportunity for Aeon to undergo expansion projects that are finances with loans at a cheaper interest rate. 7. Green government drive: This provides an opportunity for Aeon for the sale of Aeon’s products to federal and state government contractors. 8. Tax policy: The governments’ reduction in tax rate is beneficial for Aeon as a lower amount would be expensed out as a tax. 9. Tourism: Growth in tourism is beneficial for Aeon as it will provide new potential customers that it can target in order to gain market share. 10. Skilled workers: Increase in education and training by numerous institutes has increased the amount of skilled labour available within the country. This means that if Aeon is able to hire skilled labour, it would have to spend less on training and development, therefore, saving costs.

11. Consumers within the industry are becoming more conscious of health, and this is a segment that is growing. Aeon can take advantage by manufacturing products that are beneficial to customer’s health. 12. Trade barriers have been reduced on the import of goods. This will reduce the costs incurred on inputs for production.

Threats of Aeon 1. Technological developments by competitors: New technological developments by a few competitors within the industry pose a threat to as customer attracted to this new technology can be lost to competitors, decreasing Aeon’s overall market share. 2. Suppliers: The bargaining power of suppliers has increased over the years with decrease in the number of suppliers. This means that the costs of inputs could increase for Aeon. 3. New entrants: There have been numerous players that have entered the market and are gaining market share by gaining existing companies’ market share. This is a threat to Aeon as it can lose its customers to these new entrants. 4. Increasing Competition: There has been an increase in competition within the industry putting downward pressure on prices. This could lead to reduced revenue for Aeon if it adjusts to the price changes, or loss of market share if it doesn’t. 5. Exchange Rate; The exchange rate keeps fluctuating and this affects a company like Aeon that has sales internationally, while its suppliers are local. 6. Political uncertainties in the country prove to be a barrier in business, hindering performance at times and making the business incur unnecessary costs. 7. The fluctuating interest rates in the country do not provide a stable financial and economic environment. 8. Consumer tastes are changing, and this puts pressure on companies to constantly change their products to meet the needs pf these customers.

9. The rise in prices of fuel has increased in the input costs for Aeon. These costs have also increased as other industries that provide inputs for this company also have suffered from increasing fuel prices, thereby charging more. 10. Increasing promotions by competitors have been a threat for Aeon. On most media, there is more clutter than ever, and customers are bombarded with multiple messages. This reduces the effectiveness of promotional messages by Aeon.

TOWS analysis for Aeon TOWS Opportunities analysis for Aeon STRENGTH 1. Aeon has a strong

WEAKNESSES 1. A high proportion of

distribution network

property in use by is

with a large number

on rent, and rental

of outlets.

charges need to be

2. It has a low cost structure, which

paid. 2. Low amounts of

provides it with and

spending on research

advantage over the

and development as

competition.

compared to the

3. It has a strong presence on social media.

competition. 3. It has a high employee turnover rate, with low employee motivation

OPPORTUNITIES 1. Internet users are

SO STRATEGIES 1. Increase marketing

and working morale. WO STRATEGIES 1. Finance ownership

increasing around

to attract consumers

of the property

the world. E-

to spend.

through low interest

commerce is also

2. Use its presence on

growing with the

social media for

proportion of owned

increase in internet

marketing and to

property to rented

usage.

attract customer

property.

rate to increase the

2. Social media users are increasing worldwide.

towards its website. 3. Develop

2. Increase payrolls, provide incentive

environmentally

packages and

friendly products

benefits to

environmentally

through innovation,

employees to reduce

friendly products and

at a low cost so that

turnover work

services.

they could be sold at

morale. This could

Government is

a low price.

be possible as costs

3. Growth in

offering subsidies on these. THREATS 1. There is a threat of

are low currently. ST STRATEGIES 1. Use a strong

WT STRATEGIES 1. Increase spending on

new entrants coming

distribution network

research and

into the market.

to reach out to

development to

customers and fight

enable Aeon to better

off new entrants into

compete with

the market.

competition.

2. The exchange rate has been devalued. 3. Competition within the industry is increasing.

2. Use its strong

2. Provide incentives,

financial position to

increase

invest in intellectual

engagement, or

property rights. This

provide a better work

would help compete

environment to

with increasing

retain talent. This

competition in the

will ensure that

market.

employees don’t

3. Use its innovative teams to find cheaper alternatives to fuel so that these could be used, thereby reducing costs.

leave and join competitors....