Welcome to this series of blogs taking you through my Business Plan framework step by step. With the new calendar year almost upon us, it’s a great time to review your Business Plan – or start one. My method helps you develop a 1-page Business Plan you can effectively implement and regularly update.

The first step of the framework and topic of this blog is conducting a SWOT Analysis.

After more than 35 years in sales, marketing and managing my own teams and businesses, I can soundly advise that a SWOT Analysis is THE most crucial first step a business owner can make to maximise the chances of success….even before you put your website together!!

How do you know what to focus on in your website if you haven’t clearly identified what your core messages should be? And who is the target? The SWOT Analysis is the core of all your strategies.

SWOT Analysis – Why it’s such a crucial process.

The Strength-Weakness-Opportunity-Threat (SWOT) analysis sets out the strengths you and your business have that will be used to capitalise on the opportunities offered by your market.   It also identifies the weaknesses that need to be strengthened so that the threats you identify in the market don’t impact your business.

In effect it’s a simple matching process: match your strengths to the opportunities available, and un-match or set up strategies to disassociate your weaknesses from the threats.

The SWOT is the foundation of all your promotional strategies. Their effectiveness is entirely dependent on the effort and rigour you put into the SWOT analysis.

The SWOT will:

• Identify the strengths that will feature in your mission statement, your website and other social and digital platforms;
• Clarify the opportunities reflected in your vision;
• Point towards your USP – unique selling proposition – and what elevates your position in a busy and congested market;
• Helps establish all the objectives your strategies need to address; and
• Formulate your critical success factors that must be achieved for your business success.

How to perform a SWOT correctly

Download my guide here.

The key aspect to remember when completing your SWOT is that strengths and weaknesses are INTERNAL factors to you and your business, while opportunities and threats are EXTERNAL factors to you and your business e.g. your competitors, environment, politics, economy, technology etc.

So first your strengths:

• What do you do better than your average competitors?
• What unique or low-cost resources or technologies do you have?
• What do your clients see as your strengths?
• What will mean you get the sale?
• What sets you apart from your competitors?

Note though, that a strength is only a true strength if it’s a feature that you possess as an advantage over the majority of your competitors.

Now your weaknesses:

• What can be improved? What technologies are you not currently using?
• In what areas do your competitors have the edge over you?
• What necessary expertise/manpower do you currently lack?
• What causes you to lose sales? Where do customer complaints come from?
• What would your customers say are your weaknesses?

Let’s now look outside you and your business to the market you exist in. First look at the opportunities on offer:

• What new trends do you see in the industry?
• What external political, environmental, social and technological changes present interesting opportunities?
• What have you seen in the news recently that might present an opportunity?

And finally the threats from the market:

• What obstacles do you face?
• What is the competition doing that you’re not?
• What external political, environmental, social and technological changes present in the market could adversely affect your business?

Top Tips to an Effective SWOT

To get the most out of your SWOT analysis follow the following key tips:

• Be objective: ask yourself tough questions and challenge your thinking. A biased effort will just get a biased result.
• Be thorough: go beyond what you have at hand. Look to other available publications and sources for information that will add depth to your analysis.
• Get some fresh eyes: ask some trusted colleagues or a mentor to help you “see” what you may not see.
• Ask your customers and suppliers: these often have some great insights into you, your business and your market.

What to Do With the SWOT Analysis?

Now the fun begins. You use the SWOT to generate strategies and actions to address all the elements that the SWOT uncovered. You start to craft strategies that help distinguish you from your competitors, and to compete successfully in your market and grow your business. More on this later in this blog series.

Your strengths become key aspects of your strategies and provide clues to what should appear in your mission and vision statements which is the topic of the next blog in the series.

More than that, the SWOT can help identify growth opportunities – new products to develop, modified manufacturing processes to implement, and expansion possibilities.

A SWOT can highlight risks and help you take steps to mitigate or eliminate those risks.

In the end, the SWOT becomes the foundation of your business focus with clearly laid out strategies for each crucial element on that path to success.

For more information or guidance on developing a comprehensive SWOT, don’t hesitate to contact me and I will be happy to help you as I have dozens of other business owners:  rob@grapestogrange.com.au or 0409 556 650.

Next in the series will be the development of a clear Vision and Mission statement, and identifying your core values.