The Three Most Simple (and Effective) Business Analysis Tools
Welcome to Business Analysis 101. My name is Matt, and I’ll be your professor. Throughout this course, you’ll learn three main business analysis tools, all designed to help you better understand where your business is performing well and where there’s room for improvement.
No homework required, but I do recommend you take notes. If you have any questions, leave your professor (me) a comment in the box below!
Need a few simple and effective business analysis tools? Get started with these classics: SWOT Analysis, Porter’s 5 Forces and The 5 C’s of Marketing. Hi, there. Matt here, your resident e-commerce guru at Volusion. Welcome to Two Minute Tuesdays, where I give you two minutes of e-commerce advice to bolster your online success. Whether you're a pro or first-time entrepreneur, business analysis keeps you on the right track. The good news is, you don't need an MBA to get started. So join me as we walk through three proven tools for business analysis. The first tool on our list is a SWOT analysis and this analysis is one of the easiest and most effective to conduct. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. Strengths and weaknesses are pretty self-explanatory and include areas which your business excels and struggles. Opportunities, on the other hand, include various possibilities for growth, while threats include a wide range of aspects including competitors, technology shifts, et cetera. Documenting these gives you a great perspective to what your next steps would be to drive growth. The next model is Porter's Five Forces, which helps you outline your competitive landscape. Now the first force is Entry of new competitors. In other words, is it difficult to enter your industry or relatively easy? For example, entering the airline industry is hard, while opening a clothing store is much easier. Second up is the threat of substitutes. Can your product or service be substituted with a new technology or other product offering or not so much? Third up is the bargaining power of your buyers. So what is the demand from your customers? Do they have the income to buy from you? Force number four, what is the bargaining power of your suppliers? For example, will your suppliers lower or increase prices? Will they make it easier or more difficult to do business with them? And finally, Porter's Fifth Force is rivalry among competitors. Is it a crowded, competitive marketplace? Or is it easier to stand out from the crowd? The third model we'll cover is the Five C's of Marketing, which includes the following. First, Company. Who are you? What are you selling? Having a clear definition of this is paramount. Secondly, Collaborators. Who are your partners and allies? And how can they help you succeed? Third number C, Customers. Who's your target audience and what motivates them? Number four, Competitors. So, who's in your immediate space and how do you compare with them? Number five, Climate. So, what's the overall mood in your industry and what's demand looking like? Looking at these areas, individually and collectively, will better guide all of your marketing efforts and your budgets. Now, to this type of analysis take time? Of course it does, but just think about the amount of time and money you'll say with this knowledge. It'll definitely pay off in the long run. Have any questions? Drop me a line in the comments below. From me to you, happy selling.
