A formal definition of the term “SWOT analysis” or simply “SWOT” is as follows:
SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats. By definition, Strengths (S) and Weaknesses (W) are considered to be internal factors over which you have some measure of control. Also, by definition, Opportunities (O) and Threats (T) are considered to be external factors over which you have essentially no control (SWOT Analysis n.p.).
SWOT analysis is probably the most renowned tool for analyzing the company’s internal and external environment, forces that influence its performance, etc. It is used to define a company’s position in the market and build an effective strategy for its development and growth.
Strengths, weaknesses, opportunities, and threats for the Target Company are going to be considered in this research. Target Corporation is an American company that specializes in retail. It manages the network of shops. It is the 6th biggest retailer in the country. According to Forbes 500, it occupies 106th place in the rank of the largest companies in the world. It was founded in 1902 and has more than 350 thousand of employees. It has the following brands: Target and SuperTarget. Some additional information about the company under consideration can be obtained from the quote that follows:
Target and its larger grocery-carrying incarnation, SuperTarget, have carved out a niche by offering more upscale, trend-driven merchandise than rivals Wal-Mart and Kmart. Target also issues its proprietary Target credit card, good only at Target. After a reversal in fortune that coincided with the onset of the deep recession, Target is growing its grocery business, aggressively remodeling and expanding stores, and — in 2013 — venturing into the Canadian market (“Target Corporation Company Profile”).Now it is time to move on to the analysis of the particular strengths, weaknesses, opportunities and threats for the company under consideration. They are provided in the table below.
One of the most well-known discounted retailers in the country;
One of the largest companies in the country;
High degree of diversification of stores;
Broad territory is covered;
Huge human resources;
Charity programs that improve image of the company
Focus only on decreasing operational costs ;
Private labeled products;
Expansion to Canada;
Focus only on the American market;
Bad influence by the global financial crisis in 2008;
Huge number of lawsuits
Economic slowdown because of the global financial crisis;
Increasing interest rates and taxes
Therefore, all the factors that define the company’s external and internal environment are provided in the table above. There is no need to explain all of them. It should be a task of more detailed research and business analysis. Greater attention should be paid to some of them.
Strong financial performance and innovative approach to business are the greatest strengths of the Target Corporation. The company has been always characterized by innovative approach to business practices, their slogan is “Expect more. Pay less’ (About Target n. p.), which is very attractive for customers. Technological improvements helped the company gain competitive advantages. This factor has become important under the modern conditions, when success of business is defined by its ability to surprise a customer.
Such approach has resulted in growth of financial indicators of the company. However, such situation is also a result of effective financial management. Responsible financial management and support from the holding are among the main keys of the company’s success. Of course, the company was characterized by financial losses because of the global financial crisis. However, those losses would have been worse, if the degree of financial management had been bad.
On the other hand, the biggest weakness of the company is financial difficulties caused by the global financial crisis. The crisis declined demand on products. Respectively, it has resulted in decreased sales. The situation is improving now, but it is going to take a few years to return to previous positions.
Probably, the biggest opportunity for the company is potential expansion to Canada. It is going to help the company with attracting new customers. On the other hand, the company will be able to increase the degree of diversification. Of course, such step requires significant initial investments (Phillips and Stanley 46). However, potential benefits are going to be much higher. This step is worth doing.
Finally, the most dangerous threat to the company is potential economic slowdown. It is quite difficult to say whether the global financial crisis is over. There are still some significant problems. For example, governmental debt problems and growing pace of inflation are significant risks in all the countries, especially in European ones. They may result in the global economic slowdown that will only create new financial difficulties for the company.
Thus, the Target Corporation is one of the national leaders in retail industry. However, it is influenced by internal and external factors like any other company. These environments are characterized by the strengths, weaknesses, opportunities and threats. Analysis of these factors is the main task of SWOT. SWOT analysis of the company under consideration has been done in this paper. The results were provided in the table.
“About Target”. Target Corporation Official Website. Web. 2012.
Phillips, Jean M. and Stanley M. Gully. Organizational Behavior: Tools for Success.1st Edition. London: Cengage Learning. 2012. Print.
SWOT Analysis. Web. 2012.
“Target Corporation Company Profile”. Yahoo Finance. Web. 2012.