new business module

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BUSINESS SKILLS
Conducting a SWOT analysis forces entrepreneurs to think
critically about the business idea and improve their understanding
of it. It can also help them identify further steps they
have to take to achieve their objective.
3.2 An example of a SWOT analysis
The box below contains a SWOT analysis for Baboukar’s business
idea. Participants can use it as a reference when they have
to assess their own business idea.
SWOT analysis of Baboukar’s business idea (see Hand-out 19)
Strengths
(positive factors on which to capitalize)
• He has years of experience in tailoring
ready-to-wear and tailored clothing.
• He knows the quality of clothes people like.
• In his previous job he had contact with
customers and developed some sales skills.
• He knows where to find suppliers for fabric
and other materials.
• He can continue to work as a daily labourer
in construction until he has enough work
as a tailor.
• He does not need much material to start.
• He has a bicycle to transport his products.
Opportunities
(to seize)
• Since the garment factory went bankrupt,
hardly any clothes are being produced
locally.
• The cheap second-hand clothes worn by
the poor often require minor mending and
alterations.
• There are no tailors in the area where he
plans to open his shop.
• Many tailors lost their jobs when the
garment factory closed; it is easy to employ
tailors.
• Shopkeepers prefer selling local clothes
because of the higher profit margin.
• Rich people prefer tailored local clothes.
Weaknesses
(negative factors to be eliminated)
• He has no business management
experience.
• He has no network in the business
environment he plans to operate in.
• He has no money to invest in his business.
• He has no equipment to start his business.
• He does not know where to get machines.
• He does not know many shopkeepers.
Threats
(to avoid/to take into account)
• Other former tailor colleagues might have
the same idea and start a tailoring
business.
• Nothing prevents tailors from opening
their own shops in the same area.
• Cheap imported second-hand clothes are
very popular, particularly among poorer
people.
• The economic situation is not very good
and more and more middle-income people
are starting to buy cheap imported clothes.