- When you decide to start a new business on your own, you have to be armed and prepared with a lot of at-hand tools and systems such as the good old SWOT analysis.
- SWOT analysis is a research method to show you your company's strengths, weaknesses, opportunities and threats at almost every single stage of your business operations.
- In order to start your business right, you need to do a SWOT analysis from the very beginning - to make sure all of your goals and your actual resources are aligned and will drive you to success.
Making a decision to start a business is a very exciting time. Having had the opportunity as founder of several businesses and running a business hub for small business entrepreneurs, I regularly have the privilege of guiding small business entrepreneurs on the first step of their business strategy – their SWOT analysis.
Let’s start at the beginning.
What is a SWOT analysis?
A SWOT analysis provides an opportunity to spend valuable time focused on the Strengths, Weaknesses, Opportunities and Threats your business needs to consider and address in order to achieve your goals. To maximise your business’s potential to achieve your goals the SWOT analysis needs to provide you with a ROADMAP, otherwise known as your STRATEGIC PLAN, to chart the direction your business will take, having carefully analysed your company’s strengths, weaknesses, opportunities and threats.
Why is a SWOT analysis important?
The biggest mistake small business entrepreneurs make is to dive straight into the strategic plan without taking the time to truly understand the appetite for their business. I recommend the SWOT analysis is done based on SMART Objectives which are the COMPASS for your ROADMAP.
When is the right time to do a SWOT analysis?
The right time to do a SWOT analysis is NOW! When you have made the decision to start a business, it is human nature to ‘dive straight into the detail’ of running the business without taking the time to take a helicopter view to ensure internal strengths and weaknesses and potential external opportunities and threats have been carefully considered.
In this section we will learn how to identify and shortlist the above items appearing under each of the four pillars that make up a SWOT analysis.
- What are your greatest strengths? The greatest strength to your business is YOU! You have a clear Mission Statement and Vision for your business that is demonstrated in the way in which you conduct yourself. You are living your life purpose – to be successful professionally we must be at our peak personally.
- What resources and capabilities do you offer?
- What problem are you solving for your customers? - Your people are the face of your business and it's the reason why your customers will want to buy from you.
- How invested are you in digital technology? The key to a successful business in the 21st century is to take advantage of technology. Your website and your consistent messaging on social media platforms speak volumes to your customers and provide opportunities to stay connected 24/7.
- Do you have a sustainable revenue stream?
- Have you established a sales funnel for your business? The ability to create a sales funnel that attracts and engages your audience, converts into sales and retains them due to your unique customer experience on offer will help to grow your business for greater futures.
- What are your greatest weaknesses? - As women we are caregivers, forever juggling the work/life balance. When starting a business, the potential for failure comes from the inability to commit the necessary time and financial resources needed.
- What resources and capabilities do you lack?
- Start-ups are often one-man bands. Take advantage of the opportunity to employ interns who will be able to learn from your experience and expertise. Consider appointing an advisory board - people that you know and trust who have expertise in the areas that you lack.
- Is our revenue stream at risk from competitors?
- Every business has overheads that must be covered. Consider the best banking partner for your business and take the time to build a robust budget that is reviewed regularly and can ensure you respond rather than react to market changes.
- Are you taking advantage of social media to drive your brand reputation? - LinkedIn, Instagram and Facebook are wonderful ways to engage with your audience. If unsure as to how to maximise your social media strategy, register to attend workshops which also provide the opportunity to connect with like-minded people and grow your professional network.
- As an executive thought leader, are you taking advantage of opportunities to contribute to conversations that matter?
- Consider professional networks that you could join to grow personally and professionally. Subscribe to online sites such as SourceBottle, a free online service that connects journalists and bloggers with expert sources.
- Have you considered more than one revenue stream to grow your business?
- Whether your business solves a problem by providing a product or service, consider if there is opportunity to expand the offering to create an additional revenue stream.
- Have you considered cashflow?
- Cash is Queen!
- Ask yourself, "'What if?"
- Follow the 80/20 rule – 80% of your revenue comes from 20% of your customers. What If your main revenue stream was lost to a competitor?
- How will you ensure you are covered for potential threats to your success?
Often when we dive straight into the detail we forget to establish robust policies and procedures. Take the time to ensure your business has met all its legal obligations which will vary depending on the business structure.
With your SWOT analysis completed you have all the information needed to work on your ROADMAP to succeed with Your STRATEGIC BUSINESS PLAN.