SWOT ANALYSIS OF A MULTI PRODUCT DETERGENT MANUFACTURING INDUSTRY- A CASE STUDY

International Research Journal of Engineering and Technology (IRJET) e ISSN: 2395 0056

Volume: 09 Issue: 07 | July 2022 www.irjet.net p ISSN: 2395 0072

SWOT ANALYSIS OF A MULTI PRODUCT DETERGENT MANUFACTURING INDUSTRY- A CASE STUDY

1PG Scholar, Manufacturing Systems Management, GEC Thrissur, Kerala, India, 680009

2Professor and HOD, Department of Production Engineering, GEC, Thrissur, Kerala, India, 680009 ***

Abstract - Effective strategic management is important to all manufacturing and service organizations in the present competitive market for the development of organization. It involves theformulationandimplementationoflongtermand short term strategies taken by the organization through strategic analysis. Strategic analysis is the process of evaluation of organizations work environment through different management tools. In this study SWOT analysis and competitive analysis are conducted in a multiproduct detergent manufacturing industrytoformulatestrategies for increasing market share and profit.

Key words: SWOT analysis, SWOT matrix, Strength, Weakness,Opportunity,Threat.

1. INTRODUCTION

Soaps and Detergent market is growing continuously all aroundtheworld.Lifestyleisalsochanginginspeedpace alongwiththetechnologychange.Strategyformulationto improvecompetitivenessandmarketshareareimportantto industries. On the basis of pricing the detergent market furtherdividedintothreecategories,suchaspopular,mid rangeandpremium.

1.1 Background to the Study

The increase in competition and thereby continuous substitution by the customers forced the organizations to come up with new strategies on manufacturing, customer satisfaction,andlogisticstoincreaseinmarketshare,profit and productivity through expansion of market, market segmentsandfullutilizationofresources

1.2 Problem Statement

Industry is presently focusing mainly in three districts of Kerala,profitandsalesareinastagnatedcondition.Present market is matured with the present product portfolio of industry

1.3 Objectives

1 Toevaluatecompetitivenessofindustry throughSWOTAnalysis

2. Formulatestrategiestoincreasemarketshare andprofit

2. LITERATURE REVIEW

SWOT Analysis has two dimensions that are internal and externalfactors.Internaldimensionincludesorganizational factors,alsostrengthsandweaknesses;externaldimension includes environmental factors, also opportunities and threats(EmetGureetal)[2] Aframeworkforidentifying variablesthatthemanagementshouldanalyze, achecklists for identifying strength, weakness for environmental variables;arepresentedinaliteraturereviewonSWOTby EmetGureletal[2].Twobytwomatrixofinternalfactors and external factors in SWOT analysis is used to generate basic strategy (Thomas J. Chermack a & Bernadette K. Kasshanna) [3] Strategic position and action evaluation (SPACE matrix) is a management tool used to analyze industriesbusiness.Spacematrixhasfourquadrantsandhas differenttypeofstrategyaggressive,conservative,defensive andcompetitive(AhmadRezaOmmani)[4] SWOTmatrix comprises four strategic groups that are SO strategy, WT strategy, ST strategy and WT strategy (Tanya Sammut Bonnici and DavidGalea)[1]. SWOTanalysisistakenfrom thedatacollectionstageusingIFEandEFEanalysis. SWOT analysis itself has limitations in its use; therefore SPACE Matrixcanbeused(FadhilahK.Wardhanietal)[5].

3. METHODOLOGY

3.1 Research Design

Thisstudyisqualitativeandquantitativeinnatureandwill examine the internal and external factors of the industry, competitivenessofindustry,andpossibilitiesthroughSWOT analysis

3.2 Method of Data Collection

Primarydatahasbeencollectedfromtheindustryrecords and through unstructured interviews with managing partners and supervisors of production and distribution. Questionnaire is distributed to the management partners andsupervisorstogetthepossiblestrengthandweakness. SecondarydatahasbeencollectedfromAnnualreportsof related industries, Industry web sites, online articles and frommarkets

International Research Journal of Engineering and Technology (IRJET) e ISSN: 2395 0056

Volume: 09 Issue: 07 | July 2022 www.irjet.net p ISSN: 2395 0072

2.3 Methods of Data Analysis

Data obtained through various methods has been qualitatively and quantitatively analyzed with SWOT analysis to increase market share and to formulate competitivestrategy.

4. RESULTS AND DISCUSSION

4.1 SWOT Analysis

SWOT analysis method is used to evaluate the ‘strengths’, ‘weaknesses’, ‘opportunities’ and ‘threats’ involved in an organization and to find competitive position . SWOT analysis complements the competitive analysis. It also examineshowcompetitioninthisenvironmentislikelyto evolve and what implications that evolution has for the threatsandopportunitiesanorganizationisfacing.

4.1.2 Weakness

Weaknessofanindustryisthecharacteristicsofa businesswhichmakeitdisadvantageousrelativeto competitors.Followingaretheweaknessoftheindustry listedafterdataanalysis

1. NoR&D 2. Distributinginlimitedarea 3. Poorinadvertisement 4. Undercapacityutilizationofresources 5. Noonlinepresence 6. Nosystemforcustomerfeedback

4.1.3 Opportunity

Opportunityistheelementsinacompany’sexternal environment that allow it to formulate and implement strategiestoincreaseprofitability.Followingarethemajor opportunities 1. ConsistentDemandforFMCG 2. PopulationGrowth 3. NewMarkets 4. IncreasedHygieneawareness 5. Emergenceofe commerceandsocialmedia marketing 6. Changinglifestyle

4.1.1 Strength

Fig -1:SOWTAnalysis

Strength of an industry is the characteristics of a business which give it advantage over its competitors. Followingaretheimportantstrengthcharacteristicslisted afteranalysisofdatacollected.

4.1.4 Threats

Thesearetheelementsintheexternalenvironment that could endanger the integrity and profitability of the business.Followingarethemajorthreatsontheindustry. 1. Threatfromexistingandnewbrands 2. IncreasedGSTrates 3. Inflationrise 4. Increasingpriceofpetroleum 5. Importingpoliciesofcountry

4.1.5 Weight and rating

STRENGTH WEAKNESSES

1. Weight is the number, indicates how important the factorisifacompanywantstosucceedinanindustry. IFASmatrixassignsaweightthatrangesfrom0.00to 1.00foreachfactor.Zeromeansnoimportanceandone isveryimportant. 2. TheRatingsininternalandexternalmatrixrefertohow effectivelycompany’scurrentstrategyrespondstothe factors

Practitionersusuallyuseratingonascalefrom1to4. Ratingcaptureswhetherthefactorrepresentsamajor weakness (rating 1), a minor weakness (rating 2), a minorstrength(rating3),oramajorstrength(rating4)

Table: 1 TwobyTwoSWOTMatrix

International Research Journal of Engineering and Technology (IRJET) e ISSN: 2395 0056

Volume: 09 Issue: 07 | July 2022 www.irjet.net p ISSN: 2395 0072

Table 2: InternalFactorAnalysisSummary

Internal Factors Weig ht Ratin g Weighted Score Commends

Strength

HighQuality 0.16 4 0.64 Ensuringqualitythroughlabtesting LowPrice 0.15 4 0.6 Labourcostisless

ProductDifferentiation 0.06 3 0.18 Almostallformsofdetergentsare manufacturing

Lesstimeforproductionprocess 0.07 3 0.21 Leadtimeisveryless AvailabilityofWorkers 0.06 3 0.18 Situatedinanindustrialarea

Total 0.5 1.81

Weakness

Undercapacityutilisationofresources 0.05 3 0.15 70%utilisationonly Distributinginlimitedarea 0.1 3 0.3 Availableonlyinthreedistrictsof kerala

Poorinadvertisement 0.1 2 0.2 Dependingonlyonwordof mouth publicity

Noonlinepresence 0.05 2 0.1 Conventionalmarketing

Nosystemforcustomerfeedback 0.2 1 0.2 Gettingfeedbackfromretailers Total 0.5 0.95

GrandTotal 2.76

Table: 3 ExternalFactorAnalysisSummary

External Factors Weight Rating Weighted Score Commends

Opportunity

ConsistentDemandforFMCG 0.1 3 0.3 Continuouslyusingproducts

PopulationGrowth 0.05 2 0.1 Increasesusage NewMarkets 0.2 4 0.8 Untappedarea

IncreasedHygieneawareness andChanginglifestyle 0.1 3 0.3 Easyandspeedycleaning and washing

Emergenceofe commerceand socialmediamarketing 0.05 1 0.05 Technologydevelopment

Total 0.5 1.55

Threat

Threatfromexistingandnew brands 0.2 3 0.6

LargenumberofSMESandMNCsare theplayers

IncreasedGSTrates 0.03 2 0.06 18%forFMCG

International Research Journal of Engineering and Technology (IRJET) e ISSN: 2395 0056

Volume: 09 Issue: 07 | July 2022 www.irjet.net p ISSN: 2395 0072

Inflationrise 0.06 2 0.12 Increasedrawmaterialprice Increasingpriceofpetroleum 0.13 1 0.13 Rawmaterialsarefromcrudeoil Importingpoliciesofcountry 0.08 2 0.16 Rawmaterialsareimporting mainlyfromchina Total 0.5 1.06 Grand Total 2.61

Table: 4

4.2 Strategic Position And Action Evaluation

Based on IFAS total score of strength factor gain is 1.81 whereastotalscoreofweaknessfactoris0.95.Thisshows thatthestrengthfactorisgreaterthantheweaknessfactor andbasedonEFAStotalscoreofopportunityis1.55,total score threat is 1.06. This indicates that the opportunity is greater than the threat. Factors of strength and opportunities can support the business. Drawing a SWOT diagram shows an affirmation of the position of the company. Fig 2:SOWTDiagram

International Research Journal of Engineering and Technology (IRJET) e ISSN: 2395 0056

4.3 SWOT Matrix

Comprisesfourstrategicgroups: Howstrengthsareusedtotakeadvantageofopportunities. (SOstrategy)

How weaknesses are reduced by taking advantage of opportunities.(WOstrategy)

Internal Factors

External Factors

Opportunities(O)

O1:ConsistentDemandforFMCG

O2:PopulationGrowth

O3:NewMarkets

O4:Increased Hygiene awareness and Changinglifestyle

O5 :Emergence of e commerce and socialmediamarketing

Howstrengthsareusedtoreducetheimpactofthreats.(ST strategy)

Howweaknessesthatwill makethesethreatsa realityare addressed.(WTstrategy)

Based on IFAS,EFAS and SPACE matrix, group I strategies (aggressive)are the suggested strategies forthedetergent industry

Strengths(S)

S1:HighQuality

S2:LowPrice

S3:ProductDifferentiation

S4:Availabilityofemployees

S5:Lesstimeforproductionprocess

SOStrategies

SO1:MaintaintheQualityatLowcost

SO2:Enterintothenewmarkets

SO3: IncreaseProduction

SO4 : Utilize online marketing platforms

SO5:Delayeddifferentiation can be adopted

SO6 : Focus on products that are suitableforchanginglifestyles

SO7:ProductDiversification

Threats(T)

T1 :Threat from existing and new brands

T2:IncreasedGSTrates

T3:Inflationrise

T4:Increasingpriceofpetroleum

T5:Importingpoliciesofcountry

5. RECOMMENDATIONS AND CONCLUSION

5.1 Recommendations

Thebuyersofmidandlowsegmentdetergentproducts are very price sensitive, cheaper price would take customers’ interestsomaintaintheQualityatLowcost.Marketshould be expanded by finding new markets or new market segments. Company utilizing only 75% of its resource capacity, increase utilization of resources and production. Online marketing is growing drastically, utilize online marketing platforms. Since products lead time is short, delayeddifferentiationcanbeadoptedforbettercustomer

Weaknesses(W)

W1:Distributinginlimitedarea

W2:Poorinadvertisement

W3: Under capacity utilisation of resources

W4:Noonlinepresence

W5:Nosystemforcustomerfeedback

satisfaction.Lifestyleischangingcontinuouslyandrapidly sofocusonproductsthataresuitableforchanginglifestyles isimportant.Customersarealwayslookingfornewproduct, organisations should give importance in new product development or development of existing product are requiredtocompeteinthemarket.

5.2 Conclusion

InthisstudySWOTanalysisconductedinamultiproduct manufacturing small scale detergent industry to explore strength,weakness,opportunityandthreatofthefirmand formulated Strength Opportunity strategies to increase marketshareoftheproductsandcompetitiveness.

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International Research Journal of Engineering and Technology (IRJET) e ISSN: 2395 0056 Volume: 09 Issue: 07 | July 2022 www.irjet.net p ISSN: 2395 0072

References

[1] TanyaSammut Bonnici and DavidGalea(2015),SWOT analysis, Wiley Encyclopedia of Management,Research gate

[2] Emet GÜREL, Merba TAT(2017), SWOT analysis: a theoretical review, The Journal of International Social Research, Volume:10Issue:51

[3] Tthomasj.chermack&Bernadettek.kasshanna(2007), TheUseandMisuseofSWOTAnalysisandImplications forHRDProfessionals, Human Resource Development International,Vol.10,No.4,383 399

[4] Ahmad Reza Ommani (2011), Strengths, weaknesses, opportunitiesandthreats(SWOT)analysisforfarming systembusinessesmanagement:Caseofwheatfarmers ofShadervanDistrict,ShoushtarTownship,Iran,African JournalofBusinessManagementVol.5(22),pp.9448 945

[5] Fadhilah K. Wardhani, Ayunda Dini (2020), Strategy Formulation Using SWOT Analysis, SPACE Matrix and QSPM:AConceptualFramework, InternationalJournalof Innovative Science and Research Technology,Volume5, Issue5

[6] A Nag, Strategic management Analysis Implementation Control, Vikas publishing house pvt ltd

2022, IRJET | Impact Factor value: 7.529 | ISO 9001:2008 Certified Journal