SWOT refers to a method of analyzing your business (or for that matter, any enterprise or organization) and comparing it to that of your competitors. SWOT is an acronym that refers to Strengths, Weaknesses, Opportunities, and Threats. Strengths and weaknesses often relate to factors under your control. Opportunities and threats are often factors of the external environment over which you have no immediate control. A scan of the internal environment evaluates resources such as staffing, operational efficiency, brand recognition, and finances. A scan of the external environment includes looking at your competitors and potential competitors, as well as assessing how your business environment is changing and how that might affect your business.
A SWOT analysis can be very helpful in developing and updating your business plan. Many organizations, such as Small Business Development Centers, can be of assistance in helping you conduct a SWOT analysis.
Communities and civic groups may find that conducting a SWOT analysis is an important element to a successful strategic planning process. Your state or local Cooperative Extension office can often provide assistance or referrals for conducting an organizational SWOT analysis.
