Running head: AUTOEDGE SWOT AUTOEDGE SWOT 5 AutoEdge SWOT Desmond Sangbong Gerald Weisenseel Applied Managerial Economics May 28, 2015 The SWOT analysis is a useful tool that helps AutoEdge to understand the future current prospects for business success. The tool evaluates the internal factor to the company such as the management personnel as either strength or weakness. On the other hand, the tool describes the external factors such as economic, social/cultural and political environment as threat or opportunity to the business. In other words, the SWOT analysis provides AutoEdge with a snapshot of business’s situation. Strengths Weaknesses 1. Recognized as market leader 2. Adequate financial resources 3. Strong management team 4. Proprietary technology 5. Strong financial performance 6. Innovative culture 7. Growing brand reputation 8. Trusted brand name 9. Loyal consumers 10. The company is the leading provider of auto parts 11. Knowledgeable employees with abundance of skills 12. High quality standard of services 13. Positive consumer perception towards the organization 1. Costs disadvantage with competitors 2. Weak market image 3. No clear strategic direction 4. Lack managerial depth 5. Outdated facilities 6. Overdependence on limited services to customers 7. Price inelasticity 8. Inefficiency in terms of diseconomies of scale 9. Oligopoly market 10. Low Barrier to Entry 11. Raise unemployment 12. Overleveraged with risk and cash outflow 13. Lower interest rates 14. GDP higher per capita Opportunities Threats 1. Expand product line 2. Add related service 3. Form strategic alliance 4. Target new market 5. Increase in service demand 6. Increase inelasticity by differentiation & capture higher marginal revenue 7. Growth, efficiency, managed fixed costs with economies of scale 8. High EVA unique to demographic 1. Entry of strong competitor 2. Increased regulation 3. Change in customer buying preferences 4. Potential substitutes from the competitors 5. Inflation causing price reduction 6. Market volatility causing fluctuations in the rate of exchange Strength Strength refers to an inherent capacity that AutoEdge can use to gain a strategic advantage. The business can use its strength to obtain competitive advantages (David, 2007). The business must nurture on its strengths. The employee capabilities combined with finances becomes an essential strength especially for neutralizing the competitors’ moves. Weaknesses This refers to an inherent limitation or constraint that creates a strategic disadvantage to AutoEdge. The business must devote attention in correcting its weaknesses in order to achieve its objectives (Leigh, & Pershing, 2006). Concentrating on weakness is essential since failure can lead to business failure. Opportunities An opportunity refers to a favorable condition in the business environment that enables it to consolidate and strengthen its position (David, 2007). Opportunities can enable AutoEdg ...