Every small business owner should conduct a SWOT analysis at least twice yearly to assess their Strengths, Weaknesses, Opportunities and Threats compared to their competition, markets and industry.
A SWOT analysis contains four sections that help determine your business’s performance.
The business’s strengths indicate where the company excels and how it surpasses its competition. Whether it’s the quality of the product or service, its employees, or its position in the market, this section should tout the company’s accomplishments.
Recognizing and acknowledging the business’s weaknesses is crucial to know where to improve. For example, the company may be inefficient in certain areas or have high employee turnover. By revealing its failings, the business can take action to find solutions.
Opportunities are the external factors a business can take advantage of to grow. Opportunities abound but may be hard to spot. A SWOT analysis can help you identify new products to sell or services to offer or how new technology can improve productivity and save money.
The threats to your company are external influences that might hurt your company. Although you don’t have control over factors like rising interest rates or new competitors, it’s essential to recognize any threats before preparing an action plan.
Answering the following questions in our checklist can help you create your SWOT analysis. Download the checklist here.
This article was written by Rieva Lesonsky and originally appeared on Score.