Nobody knows this better than business people: the market is tough and competition is fierce. In order to stay afloat, get ahead, and succeed, businesses need to be strategic.

A cat is reading a book called

The SWOT analysis is a business tool that helps you formulate a plan of action by analyzing four important areas of your business.

Learning how to use this tool can take your business to the next level! 📈💰

A rocket launches and the caption says

What is a SWOT Analysis?

A SWOT analysis takes a deep look at 4 areas in relation to your business:

  • Strengths

  • Weaknesses

  • Opportunities

  • Threats

Having a clear picture of the internal characteristics (strengths and weaknesses) and external circumstances (opportunities and threats) that impact your business will help you:

  • Enhance self-awareness

  • Track and measure performance

  • Evade threats

  • Optimize resources

  • Gain a competitive advantage

A man relaxes on a giant bed of money.

Strengths & Weaknesses

Start by considering your strengths: What do you add to the market?

Then take an honest look at your weaknesses so you know what you can do better.

A man flexing from a mountaintop with a beautiful view during sunset.

Ask yourself:

  • What is my business good at?

  • What do we do better than our competitors?

  • What are our achievements?

  • What are our resources and assets?

Think strongly about:

  • What are some reasons that some people don't buy our product?

  • What do our competitors do better?

  • What have we failed to accomplish?

  • What resources do we lack?

Examples of Strengths:

Smiling people

  • High employee retention

The word brand and a crown

  • Strong brand recognition

Four hands linked together

  • Employee-owned cooperative

A hand holding a bag of money

  • Became profitable after six months

Examples of Weaknesses:

A missed field goal (American football)

  • Didn't meet Q2 sales goals

A person in between two hands with three stars over their head

  • Competitors have better brand loyalty

A bag with a diamond on it

  • Consumers find products too expensive

A crossed out money sign

  • Lack of capital to expand internationally


You work in the PR department of a tech company that's launching a new product. You've put together a list of weaknesses the company needs to confront. Which weakness should you prioritize?

Opportunities & Threats

Now it's time to see what opportunties you can leverage to help your business.

After that, examine the external threats that could make it difficult for you to perform as desired.

Take advantage of:

  • New, untapped markets with little competition

  • Markets with favorable labor laws and low taxes

  • A change in the economy or culture that creates a need for your product

Be aware of:

  • Changes in the economy

  • New regulations and rising taxes

  • New competitors

  • Negative customer opinions

  • Changing cultural and social attitudes

Examples of opportunities:

A sinking ship

  • A competitor went out of business

Two hands with a star between them

  • A nearby country doesn't have any businesses selling your product

Zero percent

  • A nearby country lowered import taxes


  • Animal rights awareness is increasing in your country and you sell vegan bacon

Examples of threats:

presidential candidate

  • The popular presidential candidate promises to raise taxes

bad review

  • Many customers left bad reviews

half price

  • Amazon begins selling the same product that you sell for half the price


  • Increased regulations on a widget you use to assemble your product


Your primary buyers are men ages 35-45. Which opportunity is the best one to take advantage of?

A Plan of Action

Code Hope is an imaginary for-profit tech bootcamp that teaches refugees coding skills without making them pay a penny of tuition upfront! They're only required to pay their tuition after gaining full-time employment after graduation.

A sign that says

Do a SWOT analysis to help Code Hope strategize!

A flexing bicep


  • Has investors who have made big investments

  • Is the only business of its kind in the United States

  • Has excellent instructors who are intrinsically motivated by the cause

A lightbulb with a dollar sign


  • Some famous celebrities started talking about "social entrepreneurship"

  • Many refugees are moving to your state because of its welcoming attitude

  • The government is giving tax breaks to businesses with a social cause

A hunched over person


  • Won't make a profit until 20 graduates pay back their tuition

  • It's difficult to find refugees who speak English well enough to find employment

  • Can't afford to pay its instructors competitively

Skull and crossbones


  • A newly formed NGO with the same mission has received many donations

  • A popular presidential candidate threatens to kick out refugees if elected

  • Increased taxes for the tax bracket that software coding salaries tend to fall in

Now think about which of the following two strategies is best for Code Hope:

Strategy A

Code Hope will only accept refugees who speak college-level English. It will lower salaries for employees to below a livable standard so that it can use the extra money to donate to political campaigns that will cut taxes for all tax brackets. Finally, it will publish unsourced blogs that claim that the NGO with the same cause has been misappropriating funds.

Strategy B

Code Hope will reach out to celebrities who tout "social entrepreneurship" to seek endorsements and monetary opportunities with their fans. It will also partner with an NGO that gives free English lessons to refugees so that its graduates have an easier time finding employment. Finally, it will donate to the candidate who is favorable to refugees.


Which strategy should Code Hope use?

Take Action

Are you ready to strategize your way to the top of the market?

A man stands on a snowy mountain and is staring at the peak which isn't far away Photo by Joshua Earle on Unsplash


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