ITPEC FE Morning April 2020 Question 68
Which of the following is an external factor related to company’s products, identified by SWOT analysis?
Explanation
Threats by new entrants — in SWOT, opportunities and threats are external factors, strengths and weaknesses internal ones.
SWOT sorts factors on two axes: internal (the company's own resources and capabilities) versus external (the market and competitive environment), and favourable versus unfavourable.
- •Internal: Strengths and Weaknesses
- •External: Opportunities and Threats
New competitors entering the market arise outside the company, which cannot control them, so they are an external threat to its products.
Answer (c)
Why not others:
- •(a) — product functions are the company's own capability, an internal strength
- •(b) — sales power is an internal resource, a strength
- •(d) — product quality is under the company's control, an internal weakness
Key rule: Ask whether the company controls the factor: if it does, it is a strength or weakness; if it comes from the environment, it is an opportunity or threat.
Business Strategy Management · AI-written, may contain errors
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