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SWOT Analysis of Dell – Dell SWOT Analysis

SWOT Analysis of Dell focuses on Strengths, weaknesses, opportunities, and threats. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT Analysis of Dell.

Dell is a US company that sells notebooks, data storage, servers, printers, and peripherals to customers. If we talk about Dell we can say that it is one of the top laptop brands in the world. Dell laptops are configured to meet the demands of every company and take care of any task with all the latest technology. Its well-known laptops models are Inspiron, Vostro, XPS, G Series, and Alienware laptops.

Strength in the SWOT Analysis of Dell – Dell SWOT Analysis

Brand name: Brand name. Dell has a very good reputation for quality goods for the company. Its brand is worth $7.5bn.
Customization of the Product. Dell lets its customers customize their laptops. Originally, these services were not available within any other major computer retailer (and currently only Sony and Toshiba allow that), but add tremendous value to customers and provide a competitive advantage for Dell.
Record Environmental. Dell is involved in many green initiatives and has received numerous rewards for being an environmentally friendly business. This is advantageous when working with agencies of the public and government.
Competency in acquisitions and mergers. Dell is spending a lot of money to acquire new ventures and doing successful mergers and acquisitions, bringing patents, assets, new capabilities, and skills into the business.
Company model on direct sale. Rather than selling its products through big-box retail stores, Dell markets directly to customers and businesses, maintaining their less profit margin.
Biggest PC & Laptop manufacturer in the world.
One of the world’s most recognized brands.
First PC maker to offer next day on-site services for products.
Business model direct to consumer. Requires cutting edge technology.
Dell has relatively low running costs compared to sales, as it leaves out the retailer and supplies the consumers directly.
Dell’s Direct Model approach helps the organization to provide direct customer partnerships, such as corporate and institutional customers.
Direct consumer from Dell allows it to have top-notch customer support before and after the transaction.
Every Dell device is designed to fit the needs of each customer. Reliability, Support, and Operation.
Dell boasts a highly efficient production, manufacturing, and distribution cycle that enables it to deliver powerful solutions to consumers at reasonable prices.
Compared with companies using indirect distribution networks, Dell is able to implement the new related technologies.
Dell is not a manufacturer; the manufacturers produce parts, and Dell uses fairly inexpensive labor to assemble the computers. Then the finished goods are dropped in by courier with the customer. Dell holds absolute supply chain order.
Dell switches inventory over every six days on average, keeping the inventory costs low.
By increasingly applying the efficiencies of the Internet to its entire sector, Dell is strengthening and expanding the fundamental competitive advantages of the direct model.

Weaknesses in the SWOT Analysis of Dell – Dell SWOT Analysis

Items in material: The large stream of Dell’s revenue comes from sales of computers, especially laptops, which is a commoditized product. Computer hardware goods (commodity) are marketed with a very low-profit margin.
Bad service to the customer: Although celebrated, Dell’s customer relations declined as its call centers were outsourced overseas. Dell has spent a huge amount of money in fixing this but has not yet recovered its former customer service image.
Less Investment in R&D: The company spends a much lower percentage of its income on R&D than its main competitors and thus missed an opportunity to develop strong products for the smartphone and tablet markets and to learn new skills and capabilities.
Low Portfolio of Patents: Due to low R&D spending, Dell has not acquired a strong patent portfolio, and is now finding it difficult to compete in the lucrative smartphone and tablet market.
Far too few shopping stores: Selling products online saves money and allows for product customization but gives the products less visibility. The customer finds it difficult to trust the goods unless he can keep them in his hands first.
Low Unterscheidung: When Dell’s competitive advantage was the low price but the company can no longer afford competitive pricing. In addition to the quality, Dell ‘s products are little differentiated from the products of the rivals and are at a competitive disadvantage if the price offered by the rival is lower.
A wide range of goods and parts from many manufacturers from various countries.
Computer maker and not the manufacturer of computers, leaving DELL unable to move supply.
Dell lacked strong partnerships with dealers/distributors.
No proprietary equipment
Not attracting the market segment of college students. Dell’s sales revenues from educational institutions such as universities constitute just 5 percent of the total.
Dell ‘s focus on institutional corporate and government customers somehow affected his ability to form relationships with educational institutions.
Dell ‘s direct method and approach to customization posed problems for home users. For one thing, customers can not go to the retailers because Dell does not use channels for distribution.
Customers simply can not purchase Dell as easily as other products, since each product is custom-built to their needs and this can take days to complete.

Opportunities in the SWOT Analysis of Dell – Dell SWOT Analysis

Expand divisions of logistics and business solutions: Dell provides numerous services (cloud, security, and infrastructure) and enterprise solutions (servers, networking, and storage), which are currently Dell’s most profitable business. Dell’s business must focus on growing those divisions as they promise better opportunities for growth and higher margins for profit.
Further patents are acquired by acquisitions: When Dell wants to diversify; it needs patents and innovative innovations in emerging technology. Dell has not properly set up its R&D facilities to discover new technologies and patents so acquiring other companies are the only feasible way to obtain patents and technologies.
The company can strengthen its presence in emerging markets: The fastest-growing markets for laptops, pc, tablets, and other electronic devices are the emerging economies. Dell has a good market presence but the company experiences decreasing market share, hence company should strengthen its position.
The growing market for tablets: Over the next few years the tablet market is projected to rise in double digits and the business has a great opportunity to introduce new tablet models and benefit from the growth of the market.
Strategy for diversification by adding a lot of new products into its portfolio.
Now more than ever personal computers are becoming a requirement. More and more consumers are being informed about computers. Second-time buyers will most likely take advantage of Dell’s custom-built machines, because as their experience grows, so does their need to explore or use some new device features.
The internet also offers Dell greater opportunities, as all they have to do now is visit Dell ‘s website to place their order or get information.
Because Dell has no retail outlets, online sales will definitely make up for her absence. Also, shopping online is more convenient for customers than actually driving and buying at a physical store.

Threats in the SWOT Analysis of Dell – Dell SWOT Analysis

Demand for smartphones and tablets is growing. Consumers also prefer tablets and smartphones over notebooks, with a lower price and greatly improved capabilities. The rising demand for the previous products is taking a share of Dell ‘s key revenue source, the laptops.
Lowering the profit margin on hardware goods. Dell ‘s key income comes from the selling of hardware goods, which will raise costs in the future due to the increasing prices of raw materials. It will add to Dell’s expenses and further increased the profit margin.
Slowing demand growth for the laptops. Computer industry growth is slowing down, and the markets will become exhausted in the near future. This will prove difficult for Dell to survive in such a market, or at least to claw back the market share lost.
Heavy rivalry. The company is facing intense competition in all segments of its market. It competes with Acer, Apple, HP , IBM, Lenovo, and Toshiba, in terms of price, quality, brand, technology, reputation, distribution, and product selection.
A competitive rivalry that exists globally in the PC market.
New business entrants face potential risks.
The possibility of being outmoded in a computer company is a pulsating fact.
The difference in price between the brands is getting smaller.
Direct Model by Dell attracts consumers as it saves costs. It could challenge Dell’s price-conscious rising consumer base because many companies can sell computers at a low cost.
Price distinction is no longer a problem for a consumer with nearly equal costs. Instead of waiting for Dell’s personalized computers, they could prefer other brands.
The computer industry’s growth rate is declining, too. Today, Dell holds the largest market share. When demand slows down, the process will make competition stiffer. To be able to continue holding a significant market share, Dell has to work doubly hard to differentiate itself from its replacements.

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SWOT Analysis of Goodyear Tyres [step by step SWOT]

SWOT Analysis of Goodyear Tyres focuses on Strengths, weaknesses, opportunities, and threats. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT Analysis of Goodyear Tyres.

Goodyear Tyres is a major US-based tyre-manufacturer. Goodyear produces, distributes, and markets tyres for trucks, buses, two-wheelers, cars, farm equipment, and aircraft. The organization has operations in 48 facilities across 22 countries with close to 64,000 workers. The firm also produces rubber-based chemicals for a variety of commercial and industrial applications. Good Year has a presence in India from the past 90 years.

The company reported an annual turnover expects a growth rate of more than 12 per cent in the coming years. The business envisages concentrating on the demand for premium tyres, which is expected to expand in the coming years. The company sells its tyres to almost every country in the world and its main focus is on the United States and Europe, from which it receives much of its sales. Goodyear also has the distinction of being the top suppliers of tyres for the famous Formula 1 motor racing event.

Competitors of Goodyear Tyres are :

Strength in the SWOT Analysis of Goodyear Tyres

Goodyear is the oldest player in the Tyre Industry.
Strengths are defined as what each business does best in its range of operations that can give its competitors an upper hand. These are Goodyear ‘s strengths:
Focus on high growth segments: Goodyear has aligned their product portfolio to high growth segments that are profitable for them, such as Wrangler SRA, Eagle F1 All-Season, and the Assurance Fuel Max. This accounts for a good return on investment.
Alignment with a strong vision: Goodyear aligns its goods and service with a vision that includes building a strong and sustainable brand, innovating in all of its goods, targeting the specific markets and providing complete commitment to all of its stakeholders, including consumers, distributors or OEMs.
Seamless product integration: Each of their categories from the NASCAR category to the commercial tyres run in full synergy. Both consumer and commercial companies are in good harmony with each of both divisions having a separate tyre- and service network.
Clear knowledge of consumer needs: Goodyear’s positioning is backed by deep research on consumers. Goodyear has also been focused on listening to the voice of the consumer and most of their items are tailor-made to suit customer needs. They also recognized the demand from each market and produced tyres, to match the needs of the individual customer.
Focus on new products: Goodyear aims to invest in new products and concentrate on the 17 “and above premium market. The company is preparing to introduce the Goodyear Assurance Climate Ready Tyres which is high grip and high traction tires ideal for all roads and all weather conditions.
Association with sporting activities: The tyre brand has always been affiliated with top racing events like Formula 1 and Nascar and the tyres are favoured on the racing circuit which is one of their main businesses.

Weaknesses in the SWOT Analysis of Goodyear Tyres

Weaknesses are used to refer to places where change is required on the company or brand. Any of Goodyear ‘s primary failings:

Inventory control: With demand volatility, Goodyear has sought to reduce prices and monitor inventory. All these policies work on Goodyear product pricing and quality and can potentially adversely impact the branding strategy.
Big size: Goodyear is actually the world’s largest company with about 64,000 staff and 52 production facilities. With the growing financial uncertainty across the globe maintaining the momentum for such a high empire would prove to be a costly business for the company.
Pricing: The bulk of the raw material used in the manufacture of tyres are oil-based derivatives and their value is influenced by volatility in oil prices. But handling tyres’ prices considering that consumers already find Goodyear to be a luxury tire brand is going to be a big problem in the future.

Opportunities in the SWOT Analysis of Goodyear Tyres

Opportunities apply to those environmental avenues that surround the company on which it can focus to raise its returns. Among the possibilities are:

The high market opportunity for premium tires: demand for luxury tyres in the 17 inch and above range is on the rise in Europe and the USA. The customer survey reveals they prefer high-value-added tyres from both a performance and style perspective. This could be a potential area for prospecting luxury tyre makers.
Increase in demand in emerging markets: in emerging economies, there is a demand for tyres, as the car and two-wheeler market is on the rise. Research also suggests that in these countries there will be a surge in the demand for replacement tires which is something Good Year will capitalize on.

Threats in the SWOT Analysis of Goodyear Tyres

Threats are those environmental factors which can be detrimental to business growth. Those risks include:

Competition: The organization faces strong competition from Bridgestone, Michelin and Cooper as well as from local players in each regional market in which they work.
Price fluctuations: The cost of raw materials for tyres, including prices of synthetic rubber, carbon black, chemical solvents, etc., are all extremely unpredictable, posing immense challenges for tyre firms.
Government Policies: Change in Government policies can adverse effect on the company.
Competitors Pricing and Discount offers can be a major threat to the company.
Cheaper Tyres in China: Imported Chinese tyre goods are cheaper and thus pose a tough market competition. Imports by the Chinese will adversely affect the profitability of Goodyear Tyres.
Volatility in rubber production: Indian rubber production is volatile and generally lower than the demand produced, and therefore the price of rubber fluctuates in light of demand. It has an impact on the firm’s pricing policy.

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SWOT Analysis of Apollo Tyres – Apollo Tyres SWOT [Detailed]

SWOT Analysis of Apollo Tyres focuses on Strengths, weaknesses, opportunities, and threats. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT Analysis of Apollo Tyres.

Apollo Tyres AG is the manufacturer and marketer of tyres and tubes. Apollo Tyres operates in Asia, Europe and Africa. Apollo Tyres are located at Gurgaon & Haryana. Operating income for the business has risen over the last few years. Apollo Tyres is a leading player in the Tyre Industry.

Competitors of Apollo Tyres are :

Strength in the SWOT Analysis of Apollo Tyres – Apollo Tyres SWOT Analysis

Strong Brand image: One of its strengths is the versatility of Apollo ‘s Brand. The company’s manufacturing units are based in India, the Netherlands, and South Africa, and its tyres are distributed in Asia , Africa, and Europe under different brand names. The presence in the portfolio of various strong brands gives the company a reputation which gives the company a competitive advantage.
Good financial performance: Apollo’s net revenues increased in the last 5 years at a CAGR of 2 percent and its income increased in the same period at a CAGR of 34 percent. Good financial performance boosts the interest of shareholders and also provides space for future expansion plans and thus also increases market share.
Research and Development emphasis: Apollo invests extensively in programs related to research and development ( R&D). Improvement of main performance parameters including endurance, grip, and mileage is Apollo’s primary objective. It helps the company to invest in new and creative goods. Good research and development provide superior technological capabilities.
Market share: Apollo has a strong market share in India, as can be seen from the graph. This is the second largest holder of market share in LCV’s and the largest holder of market share in medium and large commercial vessels.
Marketing and Promotions: Apollo Tyres is marketing its products very aggressively. Apollo Tyres is using Modern Methods of Promotion like Google Ads, Facebook ads, Instagram Ads, and Online Viral Marketing.

Weakness in the SWOT Analysis of Apollo Tyres – Apollo Tyres SWOT Analysis

Labour Strikes and Lockouts: The company has faced numerous labour Strikes and lockout issues at its plants in Durban, Vadodara, etc. in the recent past. It affects the manufacturing capacity of the company, and therefore also affects the company’s financials.
Strong reliance on the Indian market: while the company has grown internationally but the majority of the company’s revenue is based on the Indian market (about 65.2 percent of its revenue was from India in the 2015 fiscal year). This leaves the company vulnerable to changes in India’s economic and political climate. To reduce the risks of relying heavily on one market, the company needs to increase its sales in other markets.

Opportunities in Apollo Tyres Ltd ‘s SWOT Analytics:

Growing Four Wheeler Industry in India: Four Wheeler Industry in India is consistently growing and has shown 4 percent CAGR growth from the 2015-18 period. Over the same period, Indian truck manufacturing also saw a 7 per cent CAGR rise. Growth means rising prospects on both the 4-wheeler and commercial vehicle segments.
Expansion in the Two Wheeler segment: In view of its existing product range, Apollo aims to occupy 85 per cent of the industry. With the growth of the 2-wheeler industry, Apollo is able to increase its position in this industry.
International Expansion: The organization has been in an expansion phase in countries such as Lebanon, Qatar and Jordan for the last 3 years. The company will aim to do the same and venture into new markets.

Threats in the SWOT Analysis of Apollo Tyres – Apollo Tyres SWOT Analysis

Heavy competition: Competition in the tire industry is very strong with competitors such as MRF Tyres, JK Tire and Goodyear in particular in India. Fierce competition can have an effect on sales and expansion plans for the company.
Cheaper Tyres in China: Imported Chinese tire goods are cheaper and thus pose a tough market competition. Imports by the Chinese will adversely affect the profitability of Apollo.
Volatility in rubber production: Indian rubber production is volatile and generally lower than the demand produced, and therefore the price of rubber fluctuates in light of demand. It has an impact on the firm’s pricing policy.
Government Policies: Change in Government policies can adverse effect on the company.
Competitors Pricing and Discount offers can be a major threat to the company.

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SWOT Analysis of MRF Tyres [step by step Detailed SWOT]

SWOT Analysis of MRF Tyres focuses on Strengths, weaknesses, opportunities, and threats. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT Analysis of MRF Tyres.

MRF or Madras Rubber Factory is a well-known Indian tyre manufacturing firm. It soon became a multinational company and produces India’s largest number of tyres. It is based in Chennai, India and was established in 1946.

MRF also manufactures things like treads, tubes, conveyor belts, toys, and paints, along with tyres. The company also successfully established a motorsport challenge in India in the form of the MRF. Many of the company’s factories are based in South India including Puducherry, Kerala, Trichy, and several other places.

Competitors of MRF Tyres are :

Strength in the SWOT Analysis of MRF Tyres – MRF Tyres SWOT Analysis

Any brand ‘s strengths account for positive aspects which make the brand what it is today. Being a large organization, MRF has taken advantage of its success to achieve the role they are in today. And let’s see what qualities MRF carries:

Reaching Rs 5,000 crores milestone: MRF became India’s first company to reach a point where the company’s turnover exceeded Rs 5,000 crores, being listed as the number one firm in the tyre industry.
Building a strong network: MRF has a very large and established distribution network.
A significant number of production units: MRF has a total number of 6 manufacturing units, which are located in southern India.
Having a strong export market: MRF has a large and very successful position when it comes to exporting goods, which is done roughly across 65 countries.
Having a broad portfolio: There is a full range available with MRF when it comes to the manufacture and use of various tyres, designed for different vehicles.
Brand value: MRF is not only a very high value for the company but also has consumers’ confidence and faith.
Variety of tyres: MRF has also taken various steps to match the tyres, which can withstand different terrain conditions
Financial condition: MRF is in an extremely strong financial position
The company’s diversity: MRF is widely divided into three main components, Funskool, MRF Racing and the MRF Pace Foundation
Strong advertising reaching out: a company that advertises itself as a tyre-making company in India that is environmentally friendly in nature.

Weakness in the SWOT Analysis of MRF Tyres – MRF Tyres SWOT Analysis

A company counter flaws for the downsides and the challenges a company faces along the way. Below are some of the shortcomings that MRF possesses, given their rather strong strengths.
Lack of volatility: MRF still lacks a lot of volatility, for example when it comes to considering industry-based relationships, the unrest of MRF ‘s labor.
Being in a very strong competition: MRF has a lot of market competition, which is very intense and affects MRF’s good performance somewhere, particularly after the arrival of some of the world-renowned global tyre brands
These listed above were the shortcomings MRF possesses, despite having such strong strengths.

Opportunities in the SWOT Analysis of MRF Tyres – MRF Tyres SWOT Analysis

Opportunities are the places where the company will have scope for improvement that will work further in the future for their image.
Going through a rapid growth: with the growth in the automotive industry, markets are growing at a fast pace.
Maintain good relationships: have a relatively good amount of ties with some businesses and maintain a good B2B market.
Having a lot of diversity: possessing a vertical and horizontal form diversification.
Growing Car Market and Demand of the car tyres can be a great opportunity for the company.
Company can tie-up with car manufacturers to promote and use tyres of MRF.

Threats in the SWOT Analysis of MRF Tyres – MRF Tyres SWOT Analysis

Threats are something that can damage the credibility or market value of the company. Unfortunately there are some risks concerning MRF even after being one of the best in tyre companies. Those risks include:

Strike: The company has been largely traumatized by an internal strike at MRF along with the entire automotive industry in Chennai. This severely disrupted manufacturing and production in Chennai is nearly dead.
Raw Materials prices are constantly increasing: the prices of important raw materials for the manufacture of products such as natural rubber and crude oil are constantly rising, both nationally and globally. This can build a lot of trouble having rubber supply in the next two years as ANRPC has said.
Cheaper product availability: Cheaper goods are available on the market imported from China as compared with MRF. While MRF has no quality at all, it has been observed that it has made 5 percent of business in the industry as a whole.
Competition: Competition from leading tyre companies and from local market companies can be a major threat.
Costs: The rising technology and raw material costs will also pose a potential threat.
Changing Government laws for Rubber and Tyre companies is a major threat.
New Entrants can be a major threat.
Discount and attractive offers

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SWOT Analysis of Bridgestone Tyres [Explained]

SWOT Analysis of Bridgestone Tyres focuses on Strengths, weaknesses, opportunities, and threats. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT Analysis of Bridgestone Tyres.

For nearly two decades now, Bridgestone tyres have been present in India and have reported consistent production. A preferred manufacturer for Original Equipment Manufacturing (OEM) companies in India, Bridgestone also has strong customer satisfaction, though more costly than rivals. The reason for this is the responsibility of the tyre-makers to quality and their compliance with global standards.

The organization has undergone several quality certifications and received them from several of the best certification companies in the world. Bridgestone currently dominates India’s passenger car market, and is preferred to most other rival brands. Bridgestone is the most suggested and top-selling cars tyre.

Competitors of Bridgestone Tyres are :

Let’s discuss SWOT Analysis of Bridgestone Tyres.

Strengths in the SWOT Analysis of Bridgestone Tyres – SWOT Analysis of Bridgestone Tyres

Strengths are defined as what each business does best in its range of operations that can give its competitors an upper hand. Those are Bridgestone ‘s strengths:

Most Suggested Tyres: Bridgestone Tyres are the most suggested and recommended tyres by automobile manufacturers and professionals.
Brand presence: Bridgestone is a tyre company that is global, with many consumers worldwide not only recognizing but also loving the company and enjoying high brand loyalty, good memory and mindshare. The businesses operate through a large network of dealers and distributors, with offices in about 24 countries around the world.
Largest tyre-maker: Bridgestone is actually the world’s largest tyre-maker and its focus field is radial tyres.
Focus on OEM’s: Bridgestone’s main target market is the OEM’s and the company has also made genuine attempts to establish close relations with OEM’s The company has a new plan to now collaborate with various car companies to make them their favourite brand.
Special design: Bridgestone has many firsts and is home to many developments in tyre technology. One of the newest to join this list is the Drive Guard that can be fitted to any type or category of vehicles with a tire pressure monitoring device.
Run event association: Bridgestone has also been a strong presence in most important racing events like Formula 1 where it has been affiliated with many winning teams. It has increased the prestige and popularity of the brands as a choice for high performance and lasting tyres.
Good Distribution: Bridgestone tyres have a very good distribution network in the country.
Using Modern ways of Promoting Products like Social Media, Youtube Videos, Facebook, Instagram, etc.
Quality: Quality of Bridgestone tyres is trusted by a large population of customers.

Weakness in the SWOT Analysis of Bridgestone Tyres – SWOT Analysis of Bridgestone Tyres

Weaknesses are used to refer to places where change is required on the company or brand. Bridgestone’s main weaknesses include:

Increased focus on India: Bridgestone has increased their dependence on the Indian automobile market with much impetus given to OEMs here. In the long run, this may affect its focus in other, more lucrative, markets.
Expensive: Bridgestone perceived to be an expensive tyre, and it may not be preferable for customers looking for value for money tyres. That can mean lower margins for the tyre business in a price-conscious market.
Variety of terrains: Bridgestone makes tyres for countries all over the world which means that these tyres must be suitable for a wide variety of terrains. This dramatically increases the need for a diverse product portfolio as well as mandates a lot of research which may be very expensive to fund.
Complex customer behaviour: Each customer may have a different set of needs from the tyres, therefore listening to the customer’s voice is extremely important. Work therefore has to start right from the customer level and this has to be made a continuous operation. It provides the company with a great many problems.

Opportunities in the SWOT Analysis of Bridgestone Tyres – SWOT Analysis of Bridgestone Tyres

Opportunities apply to those environmental avenues that surround the company on which it can focus to raise its returns. Among the possibilities are:

High demand for replacement tyres: Over the next few years, the market for replacement tyres is expected to increase. This is a phenomenon that has been prevalent for several years now, and increasing production costs and increasing rubber and fuel prices will keep this alive for some longer.
Rising vehicle sales in emerging economies: Countries such as India, China, and Brazil will be automakers’ top destinations in the coming several years. Growing population income statistics and increased driving safety awareness will make people prefer more cars than double-wheelers. This will cause the demand for tyres to increase proportionally.
Improved market orientation: Tyre companies look favourably on vertical integration and even offer value-added services at an extra price. It includes GPS monitoring, digital infrastructure, wireless application protocol and, among others, mobile device monitoring infrastructure. Each of these may be future targets for tyre-makers.

Threats in the SWOT Analysis of Bridgestone Tyres

Threats are those external factors which can be detrimental to business growth. Some of the Threats are :

Competition: Competition from leading tyre companies and from local market companies can be a major threat.
Costs: The rising technology and raw material costs will also pose a potential threat.
Changing Government laws for Rubber and Tyre companies is a major threat.
New Entrants can be a major threat.
Discount and attractive offers

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SWOT Analysis of Ceat Tyres – Ceat Tyres SWOT Analysis

SWOT Analysis of Ceat Tyres focuses on Strengths, weaknesses, opportunities, and threats of the company. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT Analysis of Ceat Tyres.

Ceat Tyres Limited is a company founded in Turin, and currently based in Mumbai. Ceat Tyres manufacturing and selling automotive tyres, tubes, and flaps. Ceat Tyres is one of the top radial producers for multiple types of vehicles. The company manufactures, among others, tyres for light commercial vehicles (LCVs), two-wheelers such as motorcycles and scooters, passenger cars, farm vehicles, and trailers, off the road (OTR)/specialty vehicles and trucks.

The company has reported an annual turnover of close to USD 1 billion, with a production capacity of about 95,000 tyres per day.

Competitors of Ceat Tyres are :

Strengths in the SWOT Analysis of Ceat Tyres – Ceat Tyres SWOT Analysis

Strengths are defined as what each business does best in its range of operations that can give its competitors an upper hand. Ceat’s strengths are as follows:
Large product portfolio: CEAT is popular for its motorcycle tyres that are sold under the CEAT Zoom, F85, F67, CEAT Zoom Tubeless, Secura Sport, Milaze, and Secura Zoom labels, etc. The company has also manufactured tyres for scooters under the labels Zoom D and Gripp and passenger car tyres under the names Czar HT, Czar AT, Rhino and Rhino TQ. Their range of tyres for commercial vehicles is Buland and Buland Mile XL RIB, while for three-wheelers it is Anmol SL and Buland Mile XL.
High visibility of the brand: Ceat Tyres is a popular Indian brand with high recall and recognition of marks. The company has been consistent in its advertisements and has always communicated both value-driven proposition as well as technical know-how.
Focus on consumer needs: Ceat has always focused its products on customer reviews and has always adjusted its products to the customer’s preferences. The company’s new focus is on goods that are technically superior and on driving safety.
Model FMCG distribution channel: The company has based its distribution chain on FMCG companies quite unlike other tyre manufacturers. Rather of selling tyres directly to the customer, they have added an intermediary layer of dealers who market it to sub-dealers.
Advertisements: Lately, the business has conducted a lot of promotions and some of the new ads such as the Nimbu Mirchi one have been able to grab the customer’s attention.
Ceat Tyres is providing an exchange for any wear and tear of tyres for 3 Years which makes it the first choice of the customers.
Best CRM Practices: CRM practices of Ceat Tyres is very Good. Ceat uses every possible way to connect with customers.
Very Good Distribution and Dealer Network in the country.
Good focus on after-sales operation: Ceat Tyres has many customer service channels, service quality is high. Ceat has improved a lot and gives customers the best services in the industry.
Equipment: State of Art Equipments for CEAT Shoppe makes it no 1.

Weaknesses in the SWOT Analysis of Ceat Tyres – Ceat Tyres SWOT

Analysis Weaknesses are used to refer to places where change is required on the company or brand. Some of Ceat’s primary shortcomings are:
No market leadership: although Ceat is present in multiple categories such as two equipment and specialty tyres, it is not a market leader in any of these categories although it has a strong presence in the brand.
High margins: Ceat’s primary focus field is on radial tyres, and the rivalry is strong in this sector because of selling rates and high margins.
Focus on too many segments at a time: The organization is focused on too many segments at a time, which has resulted in diluting its position in all segments and rendering them unable to fight the competition, diluting the scarce resources already available.

Opportunities in the SWOT Analysis of Ceat Tyres – Ceat Tyres SWOT

Opportunities apply to those environmental avenues that surround the company on which it can focus to raise its returns. Among the possibilities are:

High growth potential: The country has around 60 big and small tyre producers, some of which are regional players. The tyres market’s growth trend between 2015 and 2021 is about 9 per cent per year. The highest growth for the two-wheeler tyres is expected.
Changing consumer needs: the needs of the customer are constantly changing and the demand is currently for safety and comfort driving. This creates a massive demand for high grip tyres.
Rising passenger car market: In India, the passenger car industry is growing and many multinationals are setting up shop in India. This will lead to increased demand for the OEMs.

Threats in the SWOT Analysis of Ceat Tyres – Ceat Tyres SWOT

Threats are those environmental factors which can be detrimental to business growth. Those risks include:

Competition: The firm faces tough competition from brands such as JK Tyres, Apollo Tyres, Dunlop, Bridgestone, Michelin, Strong Year and Cooper Tyres in India.
High material costs: materials used in tyres such as synthetic rubber, carbon black, steel reinforcement, chemicals and so on are highly fluctuating and this will invariably affect the final product pricing;

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SWOT Analysis of Berger Paints [step by step SWOT]

SWOT Analysis of Berger Paints focuses on Strengths, weaknesses, opportunities, and threats of the company. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT of Berger Paints.

Berger paints is a large business engaged in the manufacturing and distribution of Paints in India. The company has headquarters in Kolkata and originates from India. It is considered to be an outstanding producer and dealer, but it is not as powerful as Berger Paints in ads. Berger paints have a big presence in 5 countries, including India, Nepal, Russia, Poland, and Bangladesh. In addition, it is still attempting to make inroads in Africa.

Let’s discuss SWOT Analysis of Berger Paints.

Strengths in the SWOT Analysis of Berger Paints – Berger Paints SWOT Analysis

Company basket: Berger Paints provides a wide range of products like home painting, primers, coatings, etc. They also offer the option of decorative paints which is the latest on the market and in demand. It bought the unit of decorative paints from the US-based Sherwin Williams Paints.
Brand Recognition: Being the second-largest manufacturer of Paint gives them a healthy equity brand. The company is known by almost all, and is acquainted with its products and deals. Their exacting promotions made them a household name.
Foreign Market: It has international operations in a few countries including Nepal, Bangladesh, Russia, Poland, Cyprus, and cooperation with Sweden’s Becker and Japan’s Nippon paints.
Competent Leadership: Kuldip Singh Dhingra is the chairman and Gurbachan Singh Dhingra is the vice-chairman who holds a combined 75 percent stake in the company and has brought it to new heights making it the second-largest paint maker trailing behind Berger paints. The company’s future leadership is set, too. The reigns will be passed on to Gurbachan and Kuldip’s children Kanwardeep and Simran.
Loyalty: When it comes to re-painting their homes consumers are faithful to Berger Paints.
Secure supply chain: Berger Paints has a countrywide secure supply chain network. This includes seven production units, Eighty-Five depots, and many regional outlets. Berger Paints has an employee strength of 2500 and a huge distribution network of 15000 distributors across the country.
Growth: Their retail prices (RSP) have shown steady growth.
Diverse Client Base: Berger represents a diverse customer base ranging from businesses, service sectors to cars, and nuclear power plants.
Market entry barriers: They have grown so big they have created a barrier to market entry for new competition. We dominate much of the business alongside Berger Paints.
Diversification: They expanded into the Construction Chemicals segment and thereby expanded its revenue and profit scope.
CSR: We have initiated a Green Horizon program aimed at an eco-friendly painting by reducing waste and protecting natural resources.

Weaknesses in the SWOT Analysis of Berger Paints – Berger Paints SWOT Analysis

High reliance on one segment: Berger Paints for its highest sales relies heavily on one segment and this is the decorative segment. It is not a long-term plan, and can not support long-term high growth rates.
Bad picture of the brand: Berger faced a lot of negative ads because of lead found in her paints. This kind of advertisement taints the company’s brand image.
Small purchasing power: They do not have the pricing power in their pockets because of a duopoly in the industry. They have to keep their costs in line with the paint costs going on the market.
Smaller distribution – Berger paints are considered to have a smaller distribution network compared to Nerolac or Berger paints, which for the business is a big issue. It needs to extend its distribution network far and wide, and increase its production capacity to meet demand if needed.
No premium alternative – Berger paints have conveniently targeted a specific segment that gives high margin through its Royale initiative in Berger paints. To get in touch with their customers and have better sales and brand equity, Berger paints need such initiative.

Opportunities in the SWOT Analysis of Berger Paints – Berger Paints SWOT Analysis

Strategic – Berger portrays the need to be up to his game when it comes to marketing communications. Where Nerolac and Berger paints advertise to both left and right, Berger paints are left far behind and the advertising frequency is lower. With marketing, it will reinforce its mark values and create consumer demand.
Untapped market potential: Indian household use of paints is very low. It has a high growth range in this segment. There is also an increase in demand for paint due to urbanization.
New Launches: They can innovate and invest in their research and development to produce superior technology for the paint industry. They can also introduce more environmentally friendly paints, and make them safe.
Developing markets – Berger paints actually only operate in 4 countries but it can also extend to other emerging markets because of its manufacturing base.
Diversification: Berger Paints has wide potential for company and commodity diversification.
Government policies: The government focuses on urbanization, industrialization, house growth, and the creation of more cities of Tier 2 and Tier 3. In the near future, that means there will be a massive market for paints.

Threats in the SWOT Analysis of Berger Paints – Berger Paints SWOT Analysis

Raw material Prices: The prices of the raw materials of paint highly fluctuate.
Changing government laws: Changing government laws could lead to new businesses in the sector. That means heightened competition.
Rivalry eroding the margins – Stiff competition among the top three, paints from Asia, Nerolac, and Berger. Of these, Berger paints tend to be lagging behind, leading to penetrative pricing and lower margins. It is a challenge to paintings by Berger.
The Slowdown Threat: Any economic slowdown will have a direct negative impact on the construction industry and consequently also affect the paint industry.
Unorganized sector: The unorganized sector still accounts for about 35 percent of the market share and this may prove to be dissuasive to industry growth.
Raw materials scarcity: the raw materials available in the paint industry influence the cost of paint and scarcity can cause a price change, which can be a challenge to the paint industry.

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SWOT Analysis of Asian Paints [Explained Step by Step]

SWOT Analysis of Asian Paints focuses on Strengths, weaknesses, opportunities, and threats of the company. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT of Asian Paints.

Founded in 1942, Asian paints is engaged in the manufacture, selling, and distribution of paints, coatings, waterproofing etc. Asian Paints has a total revenue of 2.7 Billion US Dollars and is India’s largest paint company. The organization operates in over 19 countries, with facilities in more than 65 nations. Asian Paints is a Berger Multinational holding firm. It is estimated that the Indian Paints Industry accounts for about 65 percent of the consolidated sector at Rs 406 bn. 264 bn rs.

Asian Paints is India’s largest paint manufacturing firm with more than 54 per cent market share.

Strengths in the SWOT Analysis of Asian Paints – Asian Paints SWOT Analysis

Goof Growth: Over the past five financial years, Asian Paints has seen a healthy growth of about 8 – 12 percent. This has ensured the company is holding a good position in terms of market share. It is twice the size of any other Indian paint firm.
Clear Global Presence: Asian Paints has a large presence on a globe that operates in 19 countries and has 26 manufacturing units worldwide. Asian Paints operates in more than 65 countries and is Asia’s fourth-largest paint firm.
A wide variety of products: Asian Paints’ product line enables them to cater to various markets and sectors, they are present in automotive coatings, decorative paints, ancillaries, royal Asian Paints, etc. This enables them to infiltrate various business segments and sections of society which helps them to retain market share.
Brand Value: Asian Paints ranked 20th in Economic Times’ Top 20 Best Brands in Interbrand Report. It was also listed among the Most Creative companies in the Top 20 Countries.
Clear supply chain management: Asian Paints is a technology-driven superior organization focused on combining SAP’s Supply Chain Management ( SCM) and Enterprise Resource Planning ( ERP) solution.
Marketing strategies-Asian paints have always had successful campaigns for marketing. Over the years, it has continued its partnership with Saif Ali khan and roped for a beautiful campaign in Soha Ali khan, too. Occasionally it roped for advertisements in other celebrities but Saif Ali khan was a constant. Deepika Padukone has recently been appointed as their brand ambassador for Royale Play in Asian paints. Their mascot brand-GATTU is also very famous and is one of India’s most popular brand mascots.
Asian painting royal play – The Royale play was an innovative and revolutionary project introduced in the Asian painting industry where painters from the business would paint your home using unique designs and colors. Specially trained were these painters and consumers relied on them because they came from the Asian paint house. Deepika Padukone is the Ambassador brand for the submarine.
Good Brand Loyalty: Asian Paint Customers are brand Loyal because of its texture, finish, and quality.
Dealers and Painters Prefer Asian paints: Painters prefer Asian Paints because of its quality and texture. Painters are also given a commission from the dealers point. Asian Paints is maintaining good dealer relations.

Weaknesses in the SWOT Analysis of Asian Paints – Asian Paints SWOT Analysis

Small market share in Industrial and Auto Paint: Asian paints have a low market share in industrial paint (around 15%) and automotive (around 20%) relative to Kansai Nerolac and AkzoNobel.
Slow International Business: Asian Paints have performed below average in other overseas countries, except for Bangladesh, Nepal and the UAE.

Opportunities in the SWOT Analysis of Asian Paints – Asian Paints SWOT Analysis

Industrial growth: it has the opportunity to acquire market share in both the industrial and automotive sectors, taking into account current market situations.
Growing Indian Economy: Asian Paints has a chance to increase revenue base and expand into smaller cities with growth in the Indian Economy and the creation of infrastructure, to increase revenues.
Emerging Nations: The dream of Asian paints is to become one of the world’s top five decorative coatings firms. That can be done by an emphasis on the world’s developing economies.
Adapting to the psyche of the consumer-Change is constant. Thus, while Asian paints are leading the market as a result of Royale play, there are other reasons that it can put in to dazzle its customers and thus retain the majority market share. Of course, it was simpler than to say done.

Threats in the SWOT Analysis of Asian Paints – Asian Paints SWOT Analysis

Market Slowdown Threat: Any economic slowdown will have a direct negative impact on the construction industry and consequently also affect the paint industry.
Unorganized sector: The unorganized sector still accounts for about 35 percent of the market share and this may prove to be dissuasive to industry growth.
Raw materials scarcity: the raw materials available in the paint industry influence the cost of paint and scarcity can cause a price change, which can be a challenge to the paint industry.
Government regulations: Government Regulations and laws can also have an adverse effect on the company.
Growing Popularity of Competitors can also be a major threat to the company.

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SWOT Analysis of Kansai Nerolac Paints [Step by Step SWOT]

SWOT Analysis of Kansai Nerolac Paints focuses on Strengths, weaknesses, opportunities, and threats of the company. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors which influence the SWOT of Kansai Nerolac Paints. Kansai Nerolac Paints Ltd is a prominent chemical industry with headquarters in Mumbai, India, established during the year 1920. It is the largest painting company in the industry and in decor. It is a large manufacturer of coatings and paints. The Kansai Nerolac Paints products are Industrial Coatings, Automobile Coatings, Marine Coatings, Protective Coatings, and Decorative Coatings. The company produces and supplies paint systems added to the process, electrical component finishing lines, material handling equipment, containers, bus bodies, and furniture industries.

The company had around five production plants for painting and another six or seven production contracts. At Jaunpur in Uttar Pradesh, Bawal in Haryana, Lote in Maharashtra, Hosur in Tamil Nadu, and Sayaka in Gujarat, the company’s own manufacturing plants remain. The organization has partnered with many other business leaders with much technological cooperation.

A wide variety of products-Kansai Nerolac Paints provides large types of products. The company’s key brand is a revolutionary technology product. The business sells exclusive goods that are eco-friendly. Decorative paints – interior and exterior wall paints, wood and metal surface paints, automotive coatings – top, transparent coats, touch-up paints, heat-resistant paints, auto-refinish products, underbody paints, and PVC sealants, performance coatings are the main products of this company.

Through this article let’s think about SWOT Analysis of Kansai Nerolac Paints.

Strengths in the SWOT Analysis of Kansai Nerolac Paints

Large Business of Coatings and Paints – Kansai Nerolac Paints is India’s largest coating and paint firm and is also a powder coating industry leader.
Tech-savvy – The company’s technical innovation has helped to develop and better serve the customers.
Excellent Research and Development-Kansai Nerolac Paint’s key attribute is its excellent R&D. The firm focuses more on research and develops new quality products to meet the requirements of the customer.
Branding and Marketing Strategy – The excellent branding and marketing strategy of Kansai Nerolac Paint has taken them to the top in the industry and to gain more recognition among the people.
Top customers in the list – The company has served many major automotive customers such as Toyota Kirloskar, Maruti Suzuki, Tata Motors, Ford, Honda, Yamaha, Volvo, Ashok Leyland, and so on.
Good supply chain – The business has an outstanding supply chain network to allow consumers access to the goods.
Celebrity ambassadors – Kansai Nerolac Paint is proud to have celebrities as its brand ambassadors to contribute to the company’s growth.
Awards and accomplishments – Kansai Nerolac Paints has won multiple awards in a variety of different functions.

Weakness in the SWOT Analysis of Kansai Nerolac Paints

Change in consumer demand – The decorative paint industry is a look and feels one, where the taste and experience of the customer tend to change quite frequently. With the change in fashion, the goods quickly become obsolete. It is a major drawback for the company, like product planning and inventory problems will arise.
Kansai Nerolac Paint’s business model-the the business model of Kansai Nerolac Paint can be easily replicated by its rivals. Therefore the organization would have to develop a development platform where manufacturers, suppliers, and end-users can be incorporated.
Costly Supply Chain and Logistics – Using the Internet and Artificial Intelligence, the Simple Material industry business model finds its way to become a market leader. Kansai Nerolac Paints supply chain must, therefore, be extremely costly in a robust way.

Opportunities in the SWOT Analysis of Kansai Nerolac Paints

Scope in New Products – Kansai Nerolac Paints has strong potential for developing new products that highlight the brand in a competitive environment.
Enhanced advances in technology – Technology improves manufacturing productivity, enabling manufacturers to manufacture more types of goods and services. This offers Kansai Nerolac Paints an opportunity to start pursuing new goods.
Opportunities online – Online services are growing and consumers prefer to take advantage of them very frequently. This also offers customers new products.
Low rate of inflation – Low rate of inflation brings with it greater price stability. It provides credit to the company’s customers at a low-interest rate. This increases the consumption of the company’s products thus offering them enormous opportunities.
New Products: New Products can be launched according to market demand and trends.
Offers on Bulk Purchase: Kansai Nerolac can capture the market by offering special discounts to Builders and Developers on bulk purchases.
Sanitizer Manufacturing: Company can enter to Sanitizer Manufacturing Industry as its demand is increasing and can be tapped easily and does not require extra licenses for the company.

Threats in the SWOT Analysis of Kansai Nerolac Paints

Changes in Regulations and Laws – Stringent guidelines and regulations on the quality of goods and production facilities are a major challenge to the operation of the company. Environmental policies are given more importance and the organization will need to constantly take care of that.
Raw material shortages – Raw material shortages and market volatility are also a major challenge to the company. Manufacturing is highly dependent on the raw materials; hence it gets affected when the raw material is unavailable or the prices keep fluctuating.
Competitor challenge – While Kansai Nerolac Paints is the leader in the paint manufacturing sector, it faces intense competition from both the local and international market.
Change in Government Policies : Any change in government policies regarding chemicals can directly affect the market of Kansai Nerolac Paints.

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BCG Matrix – Growth-Share Matrix

BCG Matrix is a strategic method used to represent the company’s brand portfolio or SBUs on a quadrant. Relative market share is represented on the horizontal axis and market growth speed is represented on the vertical axis.

Growth-share matrix or BCG Matrix is a business method that uses relative market share and industry growth rate indicators to determine the value of a portfolio of company brands and recommend additional investment strategies.

BCG matrix is a tool developed by Boston Consulting Group to determine the competitive role and ability of the portfolio of company brands. It classifies the portfolio of companies into four categories based on industry attractiveness (that industry’s growth rate) and competitive position ( relative market share). These two dimensions show the company portfolio’s probable productivity in terms of the cash required to sustain the unit and the cash it produces. The general aim of the review is to assist in understanding which products the business should invest in and which should be divested.

The BCG Matrix is divided into four quadrants: Star, question marks, dogs and cash-cows.

Relative Market Share

Relative market share is one of the measurements used for determining the company portfolio. Relative Market Share is the Market Share in relation to the largest competition. Lower market share for the company’s results in higher cash returns. That is because a business that generates more, benefits from higher economies of scale and curve knowledge resulting in higher profits. Nevertheless, it is worth remembering that with lower production rates and lower market share, certain companies will reap the same benefits.

How to Evaluate Relative Market Share

Relative Market Share is the market share in relation to the largest comeption. Relative Market Share is :

Relative Market Share (%) =

100 * Brand’s Market Share ÷ Largest competitor’s market share

Here we are taking “Company A” into consideration. If “Company A” has a market share of 20% and the largest competitor is “Company B” which has a market share of 60% then the relative market share of “Company A” is 20%/60% = 1/3. Here relative market share is low.

Another Scenario is if we are considering Company X which has a market share of 60% and the largest competitor “Company Y” is having a market share of 20% then the relative market share is 60%/20% = 3/1. Thus we can say that “Company X” has a relatively high market share.

Market Growth Rate

High market growth rates mean higher earnings and often income but they also absorb tons of cash, which is used as an investment to stimulate more growth. Business units operating in fast-growing markets are often cash consumers and are worth investing in only when they are projected to expand or retain market share in the future.

Four Quadrants of BCG Matrix

Star : High Growth Rate and High Relative Market Share means the product is of Star Category. Star category consumes more cash.
Cash Cow: Low Growth Rate and High Relative Market Share means the product is Cash Cow.
Dogs: Low Market Share and Low Relative Market Share means the Product is in a category of Dogs.
Question Mark or Problem Child: Market Growth Rate is high and Low Relative Market Share means the product is in a Question Mark Category.

In Depth Explanation of BCG Matrix:

Dogs: Compared to rivals, dogs retain small market share and operate in a steadily rising industry. These are usually not worth investing in, because these produce small or negative cash returns. But the truth isn’t always this. Some dogs may be competitive for a long time, they may provide synergies for other brands or SBUs, or they may simply serve as a buffer against moving rivals. It is therefore also necessary to carry out a more in-depth review of each brand or SBU to ensure that they are not worth investing in or have to be divested.

Strategic choices: decommissioning, divestment, liquidation

Cash Cows: Cash cows are the most profitable brands to have as much cash as possible, and should be “milked.” To help their further development the cash earned from “cows” should be invested in stars. Corporates should not invest in cash cows to encourage growth, according to the revenue-share equation, but only to help them so that they can sustain their current market share. That’s not always the truth, again. Cash cows are usually large corporations or SBUs with the ability to innovate new products or processes that can become new stars. If cash cows were not sponsored, they wouldn’t be able to make these inventions.

Strategic choices: production of products, diversification, divestiture, reduction

Stars: Stars work in fast-growth markets and hold market share high. Stars are cash producers, and cash users alike. These are the primary units the business will invest its capital in, as it is predicted that stars will become cash cows and produce positive cash flow. But not all stars transform into cash flows. That is especially true in fast-changing markets, where fresh, groundbreaking goods will quickly be outcompeted by new technical developments, and a star becomes a dog instead of being a cash cow.

Strategic choices: vertical integration, horizontal integration, market penetration, growth of the goods

Question Marks: Question marks are those brands that require much more attention. They hold low market share in fast-growing markets which consume large amounts of cash and cause losses. It has the potential to gain market share and become a star that will become a cash cow later on. Question marks aren’t always successful and they fail to gain market share even after significant amounts of investment and ultimately become pets. Therefore they need very close consideration in determining whether or not they are worth investing in.

Strategic choices: market penetration, product growth, divestment

BCG matrix quadrants are condensed representations of the truth and are not automatically applicable. As general investment guidelines they can support but should not affect strategic thinking. In order to make more sound investment decisions, company should rely on management judgment, strengths and limitations of the business unit and external environmental factors.

Benefits and Disadvantages of BCG Matrix

Simple to render;
Helps to consider portfolio competitive positions;
This is a good starting point to explore more in-depth.
Analysis of growth-share has been widely criticized for its oversimplification and lack of useful implementation.

Drawbacks of BCG Matrix

Only four quadrants can be listed for the company. Classification of an SBU which falls right in the center can be confusing.
It has no idea of what ‘business’ is. Companies may be known as cash cows when in fact they are dogs, or vice versa.
Does not involve any external variables which may fully alter the situation.
Market share and development in industry are not the main drivers of profitability. However, high market share does not automatically mean high profits.
This denies there are synergies between the various groups. Dogs can be as valuable to companies as cash cows if it helps achieve competitive advantage for the rest of the business.

Using the method

While BCG analysis has lost its importance due to several limitations, if performed by following these measures, it can still be a useful tool if:

1^st Step: Start Choose the Unit

2^nd Step: Defining the market

3^rd Step: Calculate relative market share

4^th Step: Evaluate Market Growth

5^th Step: Create circles on a matrix

1^st Step: Start Choose the Unit

BCG matrix may be used as a unit itself for the analysis of the Strategic Business Unit (SBU), different brands, goods, or business. Which unit is to be selected will affect the whole analysis. Therefore, identifying the unit for which you will be doing the analysis is important.

2^nd Step: Defining the Market

In this review one of the most important things to do is to describe the market. It is because the incorrectly defined market could lead to poor ranking. For example, if we were to do the research on the passenger vehicle market for the Daimler’s Mercedes-Benz car brand it would end up as a dog (it has less than 20 percent relative market share), but it would be a cash cow on the luxury vehicle market. Defining the market clearly is critical in order to better understand the portfolio role of a company.

3^rd Step: Calculate Relative Market Share

Calculate the market share compared to that. Relative market share may be measured from a sales or market share perspective. This is determined by dividing the market share (revenues) of your own brand by your biggest competitor’s market share (or revenues) in that industry. For example, if the market share of your competitor in the refrigerator industry was 25 per cent and the brand market share of your business was 10 per cent in the same year, your relative market share would be just 0.4. Relative market share on x-axis is given. Its top-left corner is set at 1, midpoint at 0.5 and top-right at 0 (see example below).

Relative market share is equal to the market share or revenue of your business divided by the market share or revenue of the largest competitor.

4^th Step: Market Growth Rate:

Find out the pace of business growth. The rate of growth in the sector can be found in reports from business, which are typically available free online. It can also be measured by looking at the average sales growth from leading companies in the industry. The growth rate on the market is calculated in percentage terms. The y-axis midpoint is typically set at a growth rate of 10 per cent, although this can vary. Some industries have been growing for years but at an average annual rate of 1 or 2 per cent. So, if you do the research, you can figure out what growth rate is considered to be important (midpoint) to distinguish cash cows from stars and dog question marks.

5^th Step: Create circles on a matrix

You should be able to plot your marks on the matrix after calculating all the measures. This should be done by drawing a circle for each mark. The circle size will equate to that brand’s share of the business revenue generated.

The BCG matrix is used to strategize

Knowing that you know where each business unit or product is, you can make an accurate evaluation of them.

Possible approaches that you can pursue based on the results of BCG matrix analysis:

Boost investment in a company to boost market share of that product. You can, for example, push a question mark into a star and eventually a cash cow.
If you can’t put more money into a product, keep it in the same quadrant and let it be.
Reduce the investment and try to take out the product ‘s full cash flow, thereby increasing its overall profitability (best for cash cows).
Release the sum of money already trapped in the (best for dogs) company.
You need products to sustain a stable cash flow in every quadrant of your BGC matrix, and provide products that can protect your future.

Cash flow’s role in the BCG matrix

Cash Cow generates a high amount of Cash and this can be generally used for Star and Question Mark Category Products.
Question Mark Category products require cash and investment to increase its market share. Question Mark Products if ripped properly with more cash and strategically operated can become Star Products in the future. but if Question Mark Category Products do not succeed in becoming Star Category Products then they end up becoming dog category products when the market growth declines.
Star Category Products require a good amount of cash to sustain the market. Star Products can become a Cash Cow when Market Growth Rate is low.

BCG Matrix Advantages

The BCG Matrix is useful for managers in determining balance in the existing portfolio of Stars, Cash Cows, Question Marks and Dogs in the businesses.
BCG Matrix is applicable to large companies finding results of volume and experience.
The concept is straightforward and quick to understand.
This provides the strategic framework for making decisions and planning for future actions.
When a company can take advantage of the knowledge curve, it will be able to produce and sell its goods at a price that is small enough to take the lead in early market share. It is supposed to be lucrative until it is a star.

BCG Matrix Limitations:

This neglects the influence of the inter-unit synergies.
A high market share is not the main factor of growth.
Economic growth is not the sole measure of a market’s attractiveness.
Dogs will often earn much more cash than Cash Cows.
The challenges of having market share data and the growth of the sector.
A high market share does not automatically contribute to sustained profitability.
The model only uses two dimensions-market shares and rate of growth. This can tempt management to emphasize a specific product, or prematurely to divest.
This can be profitable even for a company with a small market share.
The model neglects small competitors whose market shares are fast-growing.
While the BCG matrix is a great tool, it’s not for every company. Some companies find that they do not have products in each quadrant, nor do they have a steady movement of products among the quadrants as their product life cycle progresses.
Alternatively, some analysts recommend the use of the GE / McKinsey formula, which provides more categorization choices and calculates goods according to the strength of the business unit and the competitiveness of the sector rather than market share, the scope of which could be beyond the control of an individual organization. Comparing the two models can reveal hidden insights that fuel your company’s growth.

Example of BCG Matrix

Products which are offered by Google and see how do they fit into this matrix now today the online video market is growing at a very fast rate because of easily available internet because of smart devices the consumption of videos online is very high. Now in a high-growth market, Google’s product which is YouTube has a very high market share. Now because it has a relatively high market share and it is a high growth market. we can categorize it as a star as and when the market becomes more mature when the growth rate starts falling this can convert into a cash cow. As we can see in today’s time search engine is one thing which generates a significant amount of cash for Google. Products such as Google Drive, Google Docs are also in a high-growth market means the market. The demand for cloud storage is ever increasing is growing at a very high rate but the shade of Google in that segment is not that high because companies like Amazon Web service have a much larger share in the cloud business. Microsoft still has a larger market share so here the product has a lower market share relatively but it’s in a high market this becomes a question mark now because it is a question mark Google can either increase the market share convert it into a star otherwise gradually it will become a dog and if it will die down. If we look at the fourth category some products of Google like Google Groups which is not much of relevance today or could which was promoted by Google a social media platform from question mark it also became a dog it was eventually moved out or it was eventually divested one the product moves into this dog category. The only choice available to most of the businesses to divest it to sell it off collect whatever amount you can collect and put it into other business rather than continuing a business which is in the dog category so in this way we can see how different strategies can be used for the product which falls in different categories.

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