When preparing to enter the market with a new product or service, you must take note of the evolving opportunities and threats that can arise. By completing a SWOT analysis as part of your business plan, you can relate these external opportunities and threats to your businesses’ own strengths and weaknesses. Completing this exercise can help you determine the best time to enter the market, or even help evaluate the attractiveness of a particular market.
A powerful tool to use while developing your business plan is a SWOT Analysis. Short for Strengths, Weaknesses, Opportunities and Threats, conducting a SWOT analysis forces you to examine internal factors – strengths and weaknesses – and identify external factors that could affect your business– opportunities and threats. From this exercise, you can uncover unique opportunities due to your strengths, and address your weaknesses to mitigate external threats.
A SWOT analysis most often examines overall business strategy. However, it can also focus on a particular aspect of your business: human resources, brand image, marketing activities, competition, new markets, product, industry, and more.