SWOT Analysis Having a clear understanding of both internal and external factors is essential for a successful strategy. The SWOT analysis is a simple yet effective tool for understanding those factors. It will highlight the strengths and weaknesses (internal) as well as the opportunities and threat (external) for a certain company or project. Strengths One of the factors that have deterred people from drinking coffee in the past was the belief that it was in some way harmful.
This is no longer the case. In recent years, some 19,000 studies have been done in an attempt to understand the risks or benefits of consuming coffee. “Overall, the research shows that coffee is far more healthful than it is harmful,” says Tomas DePaulis, PhD, research scientist at Vanderbilt University’s Institute for Coffee Studies. This is good news for coffee house like us, as consumers are happier to drink more caffeinated beverages.
Besides, our coffee house’s menu is based on the concept of low sugar and calorie as well as we use organic ingredient in preparing our drink and food to the customer so this will attract a lot of young profession who care about their health and diet. Location Weaknesses As with growing any crop there are unpredictable elements that will affect the production of the crop and therefore the cost of coffee for our coffee house may increase. For example, in 2005 coffee prices rose and this rise was most likely because of a harvest that was 10% to 20% lower than that in the record years before.
An increase in consumption of coffee in Russia and China also played a part. Since our coffee house use the coffee bean that directly imported from Brazil so there is big chance that the cost of our coffee will increase due to the above reason. Due to the recent economic downturn, consumers are less likely to spend RM10. 00 for a cup of coffee than a year or two ago. Consumers are more conscious of spending and are more willing to shop around for the best deal.
To remain successful, a coffee house needs to change their business in response to this consumer trend. Our coffee house encounters this problem by using the product differentiation strategy by providing a fish ______________ and warming treat from our well-trained employees to those customer that come to our coffee house. Opportunities With over 80% of the world’s population are consuming coffee, the market is vast and demand is on the rise. The coffee industry is well developed and rooted in society of Malaysia as well.
It is not surprising to find in the local coffee and food court that coffee and tea are usually ordered together with meals so there exist a huge demand and market for coffee house like us that provide quality beverages and quality services. Nowadays, the younger generation of locals prefers the modern coffee house like environment that provides a warm, calm environment in which people come to socialise, relax or even catch up on work. More and more local are seen to use coffee house as a place for sale promotion or business discussion, this match with our coffee house target market which is young professions.
Threats A common threat in any industry is an economic recession, which reduces consumers’ consumption. We are currently in a recession and this has reduced revenue in companies, regardless of the sector. It is not only the coffee industry that has felt the effect of a more money-tight consumer base. A coffee house is exposed to rising costs of coffee and dairy products. This is something that cannot be foreseen but may have a big impact on the coffee house industry in which our coffee house will use the quality coffee bean
