SWOT Analysis Example

 

Let's walk through a SWOT analysis for a realistic business scenario.

 

Example: A regional coffee chain with 50 locations in the Pacific Northwest is considering expanding nationally. They've asked us to assess whether this is a good strategic move.

 

Strengths

 

• Strong brand loyalty in existing markets with high repeat customer rates
• Proprietary roasting process that produces a distinctive flavor profile
• Experienced management team that has successfully scaled from 10 to 50 locations
• Higher profit margins than industry average due to vertical integration
• Strong company culture with low employee turnover

 

Weaknesses

 

• Limited brand awareness outside the Pacific Northwest
• Supply chain optimized for regional distribution only
• No experience operating in highly competitive urban markets
• Limited capital compared to national competitors
• Technology systems not built for national scale

 

Opportunities

 

• Growing consumer preference for specialty coffee over mass-market brands
• Several regional competitors have recently been acquired, creating market gaps
• Remote work trends increasing demand for quality coffee in suburban areas
• Potential for franchise model to accelerate expansion with less capital

 

Threats

 

• Starbucks and other national chains have significant resources to compete
• Economic uncertainty could reduce consumer spending on premium coffee
• Rising real estate costs in target expansion markets
• Coffee bean prices are volatile and trending upward
• Labor shortages affecting the restaurant industry broadly

 

Strategic Implications

 

This SWOT analysis suggests a cautious approach to national expansion. The company has real strengths in product quality and operations, but significant weaknesses in the capabilities needed for national scale.

 

A potential recommendation would be to pursue expansion through a franchise model in suburban markets where competition is less intense. This approach leverages the company's strengths while addressing capital constraints and avoiding direct competition with national chains in urban centers.

 

Using SWOT in Case Interviews

 

Here's something most candidates get wrong: you should never directly use a SWOT analysis framework in a case interview. Doing so often feels forced and lazy.

 

Instead, use SWOT as a mental model to inform your thinking. The concepts behind SWOT should shape the questions you ask, the framework you build, and the recommendations you make.

 

SWOT concepts show up in many case types, but each type has its own more tailored framework. Understanding this distinction is critical for case interview success.

 

Market Entry Cases

 

SWOT thinking is highly relevant here. You need to assess whether the company has the strengths to succeed in a new market while understanding the external opportunities and threats.

 

However, the optimal framework for market entry cases is not SWOT itself. Instead, use a market entry framework that covers:

 

• Market attractiveness
• Competitive landscape
• Company capabilities
• Financial feasibility

 

SWOT thinking informs each of these buckets, but the structure is tailored to the specific decision.

 

M&A and Due Diligence Cases

 

When evaluating an acquisition target, you're essentially conducting a SWOT analysis of that company. You want to understand what makes the target valuable (strengths), what problems exist (weaknesses), what growth potential exists (opportunities), and what risks could destroy value (threats).

 

A more tailored framework here covers: 

 

• Strategic fit
• Standalone value
• Synergies
• Deal risks

 

SWOT concepts map directly to these categories, but the framework is structured around the M&A decision rather than the generic SWOT quadrants.

 

Competitive Response Cases

 

When a competitor makes a move and the client needs to respond, understanding relative strengths and weaknesses is essential. You need to assess both companies to determine where the client can win.

 

The more tailored framework focuses on:

 

• Understanding the competitive move
• Assessing impact on the client
• Evaluating response options
• Recommending a course of action

 

SWOT thinking helps you assess the relative positioning, but it's not the framework you present.

 

Growth Strategy Cases

 

Identifying growth opportunities requires understanding what the company is good at (strengths) and where external possibilities exist (opportunities). But growth strategy cases need a framework built around growth vectors.

 

A more tailored framework covers:

 

• Organic growth options (new products, new customers, new geographies)
• Inorganic growth options (M&A, partnerships, joint ventures)

 

SWOT thinking informs which options are realistic given company capabilities, but the framework is oriented toward actionable growth paths.

 

Profitability Cases

 

SWOT is less relevant here. These cases require a profit tree that breaks down revenue and costs into their component parts. While understanding competitive strengths and weaknesses provides context, the core analysis is financial.

 

The optimal framework is a profitability tree: Profit = Revenue minus Costs, with revenue broken into price and volume, and costs broken into fixed and variable.

 

SWOT thinking is secondary to the quantitative analysis.

 

Operations Cases

 

When the case focuses on improving operations, supply chain, or internal processes, SWOT is not the right lens. These cases need process-focused frameworks.

 

The optimal framework:

 

• Examines the end-to-end process
• Identifies bottlenecks and inefficiencies
• Evaluates improvement options

 

While internal weaknesses might be the reason for the problem, the solution requires operational analysis rather than strategic positioning.

 

The Key Takeaway of Using SWOT in Case Interviews

 

SWOT is a way of thinking, not a framework to present. When you hear a case prompt, your mind should naturally consider:

 

• What are this company's strengths?
• What weaknesses might be relevant?
• What external opportunities exist?
• What threats should we consider?

 

These questions inform the custom framework you build for that specific case. But your framework should be structured around the decision at hand, not around the SWOT quadrants themselves.

 

The Biggest Mistake: Forgetting Relativity

 

Most people conduct SWOT analysis in a vacuum. They list strengths and weaknesses as if they exist in absolute terms. This is a big mistake.

 

Strengths and weaknesses only matter relative to competitors. A "strong brand" is only a strength if it's stronger than competing brands. "Good customer service" is only a strength if customers prefer your service over alternatives.

 

Here's an example of the difference:

 

Absolute SWOT (Wrong Approach)

 

Strengths:

 

• Good product quality
• Experienced team
• Solid financials

 

This tells us almost nothing useful. Every company claims good product quality and experienced teams.

 

Relative SWOT (Right Approach)

 

Strengths:

 

• Product quality rated 15% higher than nearest competitor in customer surveys 
• Management team averages 20 years of industry experience compared to 8 years at the main competitor
• Debt-to-equity ratio of 0.3 versus industry average of 0.8

 

This version provides actionable insight because it positions the company against specific competitors.

 

When conducting SWOT analysis, always ask "compared to whom?" A strength that every competitor also possesses is not a differentiator. A weakness that is common across the industry may not be a priority to fix.

 

The same logic applies to opportunities and threats. An opportunity that all competitors can equally exploit is less valuable than one where your company has a unique ability to capture it.

 

Common SWOT Analysis Mistakes

 

Beyond forgetting relativity, there are several other mistakes that undermine SWOT analysis effectiveness.

 

1. Confusing Internal and External Factors

 

This is the most basic error. Strengths and weaknesses must be internal factors that the company controls. Opportunities and threats must be external factors in the environment.

 

"Strong market growth" is not a strength. It's an opportunity. The market growth exists regardless of what the company does. Similarly, "our biggest competitor is aggressive" is not a weakness. It's a threat. The competitor's behavior is external.

 

2. Being Too Vague

 

Vague factors provide no actionable insight. "Good product" tells you nothing. "Product rated highest in J.D. Power quality survey for three consecutive years" tells you something useful.

 

Push for specificity in every quadrant. What exactly is the strength? How significant is it? What evidence supports the claim?

 

3. Listing Too Many Items Without Prioritizing

 

Some people treat SWOT as a brainstorming exercise and list twenty items in each quadrant. This dilutes focus and obscures what actually matters.

 

Limit each quadrant to three to five factors that are most relevant to the strategic decision at hand. If you can't prioritize, you haven't thought deeply enough about what matters.

 

4. Overemphasizing Strengths and Downplaying Weaknesses

 

People naturally want to highlight positives and minimize negatives. This bias makes SWOT analysis useless for actual decision-making.

 

Be brutally honest about weaknesses. The goal is not to feel good about the company. The goal is to understand reality so you can make better decisions.

 

5. Not Connecting SWOT to Strategy

 

A SWOT analysis that sits on a shelf is worthless. The entire point is to inform strategic decisions and actions.

 

Every SWOT analysis should conclude with "so what?" What does this mean for our strategy? What should we do differently? Which opportunities should we pursue? Which threats require immediate attention?

 

6. Treating SWOT as a One-Time Exercise

 

Business conditions change constantly. Competitors make moves. Markets evolve. New technologies emerge.

 

A SWOT analysis is a snapshot in time. It should be refreshed regularly, especially before major strategic decisions. What was true six months ago may not be true today.

 

SWOT vs. Other Consulting Frameworks

 

SWOT is just one of many strategic frameworks. Understanding when to use SWOT versus alternatives will make you more effective in case interviews and real consulting work.

 

SWOT vs. Porter's Five Forces

 

Porter's Five Forces analyzes industry structure through five lenses:

 

• Competitive rivalry
• Threat of new entrants
• Threat of substitutes
• Bargaining power of suppliers
• Bargaining power of buyers

 

Use Porter's Five Forces when you need to understand industry dynamics and competitive intensity. It answers "is this an attractive industry to be in?"

 

Use SWOT when you need to assess a specific company's position within its industry. It answers "how is this company positioned relative to competitors and market conditions?"

 

The two frameworks complement each other. Porter's Five Forces helps you understand the external environment (feeding into opportunities and threats), while SWOT also incorporates internal assessment.

 

SWOT vs. 3Cs Framework

 

The 3Cs framework examines Company, Customers, and Competitors. It ensures you consider all three perspectives when developing strategy.

 

Use the 3Cs when you need a balanced view of the strategic landscape that explicitly includes customer needs and competitive dynamics.

 

SWOT has significant overlap with 3Cs but structures the analysis differently. Company analysis in 3Cs maps to strengths and weaknesses. Competitor and customer analysis informs opportunities and threats.

 

SWOT vs. PESTLE Analysis

 

PESTLE examines Political, Economic, Social, Technological, Legal, and Environmental factors affecting a business.

 

Use PESTLE when you need a comprehensive scan of the macro environment. It's particularly useful for companies considering international expansion or operating in heavily regulated industries.

 

PESTLE focuses exclusively on external factors, providing detailed input for the opportunities and threats portions of a SWOT analysis. SWOT is broader because it also includes internal factors.

 

SWOT vs. Value Chain Analysis

 

Value chain analysis examines each step in how a company creates and delivers value, from inbound logistics through operations, marketing, sales, and service.

 

Use value chain analysis when you need to understand operational strengths and weaknesses or identify where costs can be reduced.

 

Value chain analysis provides detailed input for the strengths and weaknesses portions of SWOT, particularly around operational capabilities.

 

SWOT vs. BCG Matrix

 

The BCG matrix categorizes business units or products based on market growth rate and relative market share, creating four categories: stars, cash cows, question marks, and dogs.

 

Use the BCG matrix for portfolio analysis when a company has multiple business units or product lines and needs to decide where to invest.

 

SWOT is more appropriate for analyzing a single business or strategic decision. The BCG matrix helps with resource allocation across a portfolio.

 

SWOT vs. Ansoff Matrix

 

The Ansoff matrix examines growth options along two dimensions: existing versus new products and existing versus new markets. This creates four strategies: market penetration, product development, market development, and diversification.

 

Use the Ansoff matrix specifically for growth strategy decisions when you need to evaluate different paths to expansion.

 

SWOT can inform which Ansoff strategies are realistic given company capabilities, but the Ansoff matrix provides a clearer structure for evaluating growth options.

 

Turning SWOT Into Strategy

 

The ultimate purpose of SWOT analysis is to inform strategic action. Here's how to translate SWOT findings into concrete strategies.

 

Match Strengths to Opportunities

 

Look for opportunities where your strengths provide a competitive advantage. These are the most attractive strategic options because you have the capabilities to win.

 

If you have a strength in product innovation and there's a market opportunity for new product categories, that's a natural fit. If you have strong distribution and competitors are struggling with supply chain issues, that's an opportunity to capture market share.

 

Use Strengths to Mitigate Threats

 

Sometimes your strengths can protect you from external threats. A strong brand can help weather economic downturns. Deep financial resources can survive price wars that eliminate weaker competitors.

 

Identify threats where your strengths provide a buffer, and ensure you maintain those strengths.

 

Address Weaknesses That Block Opportunities

 

Some opportunities are attractive but inaccessible due to internal weaknesses. You may need to build new capabilities or address deficiencies before you can capture certain opportunities.

 

Evaluate whether the opportunity is worth the investment required to address the weakness. Sometimes it's better to focus on opportunities that align with existing strengths.

 

Minimize Weaknesses That Amplify Threats

 

The most dangerous situations occur when weaknesses make you vulnerable to external threats. A weak balance sheet combined with economic uncertainty is a serious problem. Limited R&D capability combined with rapidly changing technology could be fatal.

 

These weakness-threat combinations deserve urgent attention. They represent existential risks that should be addressed before pursuing growth opportunities.

 

Prioritize Ruthlessly

 

You cannot pursue every strategic direction simultaneously. Based on your SWOT analysis, identify the two to three most important strategic priorities.

 

Consider both the magnitude of potential impact and your ability to execute. A huge opportunity that you can't realistically capture is less valuable than a moderate opportunity that aligns perfectly with your capabilities.

 

Your Next Step to a Consulting Offer

 

Ready to stop struggling with case interviews and start landing consulting offers?

 

Enroll in my step-by-step case interview course:

 

• Get interview-ready in 7 days, not 6–8 weeks

 

• Create perfect frameworks in under 60 seconds

 

• Build business acumen in 2 hours, not 2 years

 

• Solve case math 2x faster with 80% fewer errors

 

• Practice with 20 cases covering 95% of case types

 

Join 3,000+ candidates who've landed offers at McKinsey, BCG, Bain, and other top firms. 82% of my students land consulting offers.
 
👉 Enroll Now