Anticipate your business idea’s strengths, weaknesses, opportunities and threats with the SWOT method. It is an easy and useful analysis you can perform to spot things that can affect your startup inside and out. More companies are using SWOT to assess and enhance strategies and projects. Here we tell you what SWOT is and what you can get out of it.
Starting a business usually brings more apprehension than assurance. Knowing if an idea is viable, if someone has already put it into practice and what risks it entails are just some of the things that keep entrepreneurs awake at night. SWOT analyses are a good way to check you’re on the right track.
SWOT stands for strengths, weaknesses, opportunities and threats. A SWOT analysis is usually set out in a four-square grid. Strengths and opportunities focus on what’s good about an idea and how to build on it, while weaknesses and threats warn us about what could go wrong. Analyses are based on internal and external factors that could have a major impact on the viability of a startup or a company project.
How to use a SWOT analysis for your business idea
Before making decisions, you should have all bases covered. That means researching the sector, necessary resources and competitors, and assessing whether you have the right skills to carry your business forward.
This is where you extol the virtues of your idea and consider what sets it apart. You should focus on internal strengths only.
Being aware of your idea or project’s shortcomings is a good place to start to see if you can overcome them or if they will hold you back. You should consider what you can control, your finances, and what talent you have at your disposal.
Opportunities are external factors that can help take your idea up a notch. You might be able to capitalize on changes in the market, regulation or even in your target audience’s consumer behaviour. Spotting an opportunity is critical to improving your business.
The health of the economy and competition are factors that could make or break your success. Though you can’t control threats, they do help you learn more about your business’s viability to draw up a strategy to mitigate them and react to different scenarios.
You can perform a SWOT analysis at any stage of your entrepreneurial journey. Whether your business idea is an online store, restaurant, startup or something else, a SWOT analysis is useful to get to know all the ins and outs. Many companies turn to SWOT analyses for decision-making well after the early stages of a project.