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ENTREPRENEURSHIP
QUARTER 3-WEEK 5:
Select 2 Business Establishment/Firm offering products or services. Make a SWOT analysis for each firm/establishment. I. Heineken
SWOT Analysis
STRENGTHS
Long history and strong foundation of company Well-built brand image Strong partnerships with customers and suppliers Well adapted product mix WEAKNESS Control is decentralized -Market control and promotions are fragmented -Allows licensing Pricing Too much product variety -Producing international brands and local flavors OPPORTUNITIES Affiliation with organizations and events, examples: -Nike -Sports Tournaments Product Innovations International distribution network -Acquisitions and partnerships bring additional resources THREATS Numerous competitors locally and internationally -Global expansion -Extending product mix Regulatory laws Share of throat -Healthier substitutes -More conscious customers
II. BMW
SWOT Analysis
STRENGTHS
1. Brand reputation - BMW brand is the third most valuable automotive industry brand in the world valued at $29 billion. In 2012, Forbes has also listed BMW as the most reputable company in the word. 2. Environment friendly vehicles - The company tries to develop environment friendly cars by making them more efficient. It offers nearly 20 models that emit CO2 as low as 140g/kg. To make BMW cars more environment friendly firm’s engineers develop new types of fuels, such as hydrogen, too. 3. Quality product - BMW is valued on its engineering capabilities, skilled workforce and quality products. BMW recalls their cars less often and at lower numbers than most of its competitors do. 4. Highly skilled workforce - Quality cars require premium materials and skilled workforce and BMW employs only the most skilled workers to produce its vehicles. BMW set up its assembly plants at the countries, such as USA and Germany, where there is only the most skilled vehicle assemblers. 5. Corporate Social Responsibility (CSR) - BMW is strongly committed to the environment protection, employee and community well-being and sustainability programs. The company invests large sums in employee health management, programs promoting balanced work life, sustainability requirements for its supplies and producing zero waste at its plants, 6. Strong brand presence in China - Over the last few years, BMW has seen strong sales growth in China, the largest automotive market in the world. In 2012, BMW sold 326,444 vehicles there. **WEAKNESSES
- High cost structure** - Producing quality cars and hiring skilled workforce results in high costs for the company. BMW cost structure is higher than of its biggest competitors such as Toyota, GM and Volkswagen. 2. Weak brand portfolio - BMW Group manufactures and sells only 3 brands: BMW,MINI and Rolls-Royce. Although these brands perform well in their segments, they are unable to serve larger
saturated in the developed economies, thus intensifying competition.
2. Rising raw material prices - Rising prices for raw metals will lift the costs for auto manufacturers and result in squeezed profits. 3. Decreasing fuel prices - Due to increasing extraction of shale gas, future fuel prices should drop and make electric, hybrid and hydrogen car less attractive. This creates huge losses for BMW most ambitious projects, hydrogen fuelled and electric cars. 4. Growing euro exchange rate - BMW earns part of its profits outside the euro zone. Exchange rate fluctuations threaten BMW profits if the euro will start appreciating against other currencies.
