SWOT Analysis for the Food Processing Industry

SWOT analysis is one of the popular strategy tool which addresses strengths, weaknesses, opportunities and threats used for businesses to plan their actions accordingly. It is designed to facilitate realistic, fact based and data driven approach for analyzing the strength, weaknesses opportunities and threats for organization.

SWOT analysis was first used to analyze business however now it’s often used by individuals, governments and non-profit organizations for defining better plans for better future. Food industries are highly competitive industries with lot of competition in terms of products, processes, markets and technologies etc. Right SWOT analysis would help food Industries to make good strategic decisions related with production and distribution of the food products. With respect to  the clause requirement of context of organization in ISO 22000:2018 , this is a new concept that urges an organization to conduct an analysis of its context and to identify interested parties to understand the scope of the food safety management system. All this is done to establish a clear focus on the processes and requirements needed to fulfill the objectives of food safety. Top management in an organization is responsible for understanding the context of the organization. It is because they are responsible for planning for the organizations. Analysis of internal and external issues will lead to have organizational planning.

What is SWOT?
Strength:
Strength is an element which separates it from other competitors and in which organization excels. Strength must be analyzed to decide how to use those results for business continuity and growth.
Example:
What are we doing well?
What are our strongest assets?
Weakness:
Weakness stops the organization from performing at its optimum level. They are
the areas where the businesses need to improve to remain competitive. Weakness must be analyzed to decide how to work on those results to achieve business continuity and growth.
Example:
What are our detractors?
What are our lowest performing lines?
Strengths and weaknesses are “internal factors” which take into account all the things that business owner can reasonably control.
Opportunity:
Opportunities refers to favorable external factors that could give an organization a competitive advantage. Opportunities must be analyzed to decide how to utilize this opportunities for business expansion and growth.
Example:
What trends are evident in Marketplace?
What democracies are we not targeting?
Threat:
Threats refer to factors that have the potential to harm the organization. Analysis
of threats shall be done proactively to identify and worked upon it to eliminate or reduce business risk related to business continuity and growth.
Example:
Who are are competitors and their market shares?
Any new regulations requirements that could harm the current operations. Opportunities and threats are “external factors” which take into account things organization don’t have control on but which will impact the business for better or worse.
Why to do SWOT analysis:
 For systematic and detailed analysis of organization to make precise and better decisions/strategy for organization.
 Food safety management system (ISO 22000 2018) requirement related with context of organization addresses the similar analysis to be done as a part of organizational risk assessment.

 It gives a clear picture in what you can excel and in what you need to have attention.
 It may lead you to a previously untapped market or help you to to identify roadblocks that could hinder your productivity and profits.
 By using SWOT analysis organization can reaffirm the industry positioning to use it to build a strong foundation for business growth.
 Food processing industry is a very competitive industry with so many E products technologies etc. Right SWOT analysis would help industries to make good strategic decisions related to to production and distribution of food product.

How to do SWOT analysis:
 While doing SWOT analysis it’s better to co-ordinate with All the departments as it will provide insights inputs from various perspectives.
 Use brainstorming technique for generating list of ideas with respect to respect to strengths opportunities weaknesses and threats for the organization.
 Discussion of team members will lead to precise points related with mentioned aspects.
 Draw a SWOT analysis Matrix for writing the points in respective categories.

Common examples of Strengths, weaknesses, opportunities and threats for SWOT analysis:
Strengths: (Helpful)
A. Established organization with popular brands and products.
B. Strategic location of plant.
C. Strong distribution network.
D. Strong brand
E. Low product cost
F. Loyal customers
G. Strong supplier relationships
H. Skilled and experienced manpower
I. Involvement of employee for improvements
J. Diversity of products
K. Strong social media influence
L. Minimum inventory cost
M. Latest technology with speed and capacity
N. Accreditation and certifications.

Weaknesses:(Harmful)
A. Newly established organization
B. Plant not suitably located
C. Cost of the product
D. Inventory cost
E. Weak brand
F. Limited cash flow
G. High level of debts
H. Low profit margin
I. Inadequate supply chain
J. Diversity of background of Manpower
K. Leadership issues
L. Centralized system for decision making
M. Frequent changes in management
N. Less involvement of workforce in improvement and problem solving
O. Old Technology
P. Unavailability of skilled manpower
Q. no certifications/ accreditation
No social media presence.

Opportunities:(Helpful)
A. New market for existing product
B. New products for existing and potential markets
C. Technology for high yield speed and cost reduction
D. New opportunities for marketing of product online and on other platforms
E. Social media marketing
F. High paying capacity of customers
G. Healthy and other new choices of consumers
H. Export of food product to other countries
I. Change in population profiles and lifestyles of people
J. Government subsidies for businesses and upgradation of setup
K. Contract farming supplier contracts
L. Partnerships and associations
M. Research and Development.

Threats:(Harmful)
A. Limited suppliers
B. Competition with respect to Products markets technology
C. Competition in supply chain
D. Changing taste requirements of consumers
E. Changing scenarios in government policies regulations
F. Government restrictions
G. Profitability of business
H. Situation like covid-19 and other emergencies
I. Evolving Technology
J. New hazards and food safety risks
K. Intentional activities To hamper food quality and safety
L. Political effect
M. Weak data security
N. Attrition of people
O. Factors like seasonality and weather impact on resource availability.

Conclusion:

Systematically conducted SWOT analysis will help to identify the crucial factors for a business. These factors when further analyzed in terms of risk assessment and opportunity assessments will help to develop a better planning for business. Planning shall further be detailed in terms of actions which should address
What to do?
How to do?
When to do?
Who will do?
Objectives of the businesses should be in line with this action for precise monitoring and to achieve the improvements. Thus SWOT analysis can be used a powerful tool for organizational risk/opportunity assessments and action planning to address those risks/ opportunities.