TOOLS IN EVALUATING

A BUSINESS
Different Tools in Evaluating a Business

• SWOT ANALYSIS

• PORTER’S 5 FORCES OF COMPETITIVE

POSITION ANALYSIS

• INDUSTRY ANALYSIS

• ENVIRONMENTAL ANALYSIS
STRENGTHS WEAKNESSES

S W
O T

OPPORTUNITIES THREATS
SWOT ANALYSIS

-Created by business gurus Edmund P. Learned,

C. Roland Christensen, Kenneth Andrews and
William D. Book in their book Business Policy, Text
and Cases.
SWOT ANALYSIS

A tool for evaluating the internal and external

factors that affects the business organization.

INTERNAL FACTORS
- Elements that have direct impact on the
business organization.

• Physical resources- Location, facilities, machinery and equipment

• Human resources consisting of employees
• Financial resources such as money and sources of funds for investments
EXTERNAL FACTORS
- Elements that have indirect but significant
impact on the business organization.

• Market Trends
• National and local laws
• Demographic characteristics of the target market
• Relationship with suppliers and customers
• Competitors
 SWOT ANALYSIS

S Strengths- characteristics or company’s

attributes that give a competitive edge over
others
W Weaknesses-limitations or deficiencies of the
business that need to be improved or changed.

O Opportunities-factors or events that can give a

positive impact to the company if properly
addressed.

T Threats- external factors which may negatively

impact the company.
 GROUP ACTIVITY
Instructions:

1. Think of a business that you may want to put up in your

community.

2. Choose the form of business organization that you want to use.

3. Make a SWOT analysis of your chosen business.

4. Endorse your business by using marketing strategies or

promotional tools such as advertising, sales promotion, personal
selling, or direct marketing to create awareness and persuade the
target market to buy the product or patronize the service.
 CRITERIA Score

Uniqueness of the business 5

Content of SWOT Analysis 5

Creativity of promotional tool 5

TOTAL 15
Do you think that
SWOT analysis is a
helpful tool in
making a business
competitive? Why?
As a student, how
would you apply
SWOT analysis in real
life situations?
 Match the conditions with the kind of environment it is associated
with and the type of factor it is classified in SWOT Analysis.

CONDITION INTERNAL/
EXTERNAL
S/W/O/T

1. High inflation rate

2. Lack of management skills of middle
managers
3. Good corporate integrity

4. Eco-friendly products

5. More sources of raw materials

CONDITION INTERNAL/
EXTERNAL S/W/O/T

6. New competitors

7. Lack of advertisement and other form

of promotion
8. Poor brand image

9. Unpredictable weather

10. Poor customer service

 Match the conditions with the kind of environment it is associated
with and the type of factor it is classified in SWOT Analysis.

CONDITION INTERNAL/
EXTERNAL
S/W/O/T

1. High inflation rate EXTERNAL THREAT

2. Lack of management skills of middle

INTERNAL WEAKNESS
managers
3. Good corporate integrity INTERNAL STRENGTH

4. Eco-friendly products INTERNAL STRENGTH

EXTERNAL OPPORTUNITY
5. More sources of raw materials
CONDITION INTERNAL/ S/W/O/T
EXTERNAL

6. New competitors EXTERNAL THREAT

7. Lack of advertisement and other form

INTERNAL WEAKNESS
of promotion
8. Poor brand image INTERNAL WEAKNESS

9. Unpredictable weather EXTERNAL THREAT

10. Poor customer service INTERNAL WEAKNESS

ASSIGNMENT:

RESEARCH ABOUT THE DIFFERENT TYPES OF

BUSINESS INDUSTRIES.