In performing an analysis of the current position of a business, a tool or process known as a SWOT analysis is often performed. The SWOT analysis looks at four crucial characteristics of a business, whether it be a long established major player or a cheap business for sale at lower cost: the strengths and weaknesses of the businesses, and the opportunities for and the threats to the business that exist. The SWOT analysis is believed to have been devised in the nineteen sixties or the nineteen seventies, but its creator remains unknown. It is often falsely attributed to one Albert Humphries, a business consultant from the United States of America, but while he was alive he vehemently disputed this attribution. The advantage of a SWOT analysis is that it presents in a matrix the positive and negative aspects of both internal (the strengths and weaknesses) and external (the opportunities and threats) factors. The SWOT analysis process is used by all sorts of businesses and other organisations with varyin g levels of sophistication, from corner delis to business brokers in Sydney. There are two very common uses for the results of a SWOT analysis for improving a business: conversion and matching.
In a process of conversion, ways are found for the organisation to transform so that weaknesses become strengths, or external factors which were previously threats become opportunities. In matching, competitive advantages of a business are found by finding strengths that are well adapted to take advantage of upcoming opportunities for the business. In the case of both weaknesses and threats which cannot be avoided, exposure should be minimised if at all possible. The four Ps of price, product, promotion, and place are examples of factors that can be considered not only in the undertaking of a SWOT analysis but also in performing other forms of analysis of a business: for example, when considering small business for sale in Sydney.
With the regards to the four Ps: product is the service or good that a company or business produces that satisfies consumer demand; price is the amount charged by a business for their product; promotion is advertising and other information that the business provides regarding its products; and place is the distribution strategy for the product. For a typical consumer facing small business, place is fairly simple: the place of sale for that business is its premises. Little distribution strategy is required because it retails in place, rather than producing a good that is then sold by a separate retailer. Examples of businesses that may not require much of a distribution strategy are single store retailers, take away shops, greengrocers, and so on, all of which tend to be retailers only rather than producers of their own homogenous product. A similar yet separate framework that has been proposed in place of the four Ps is the four Cs, which is seen as more consumer oriented.