SWOT analysis for Swatch Essay Example
SWOT analysis for Swatch Essay Example

SWOT analysis for Swatch Essay Example

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  • Pages: 2 (385 words)
  • Published: July 20, 2017
  • Type: Analysis
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The Swatch trade name is facing challenges in gaining publicity due to a significant disconnect in the ticker market. This has resulted in lower asset turnover compared to its competitor's parent company, negatively impacting financial profits. Additionally, Swatch Group's employee productivity is relatively weak with a value of $0.2 million, whereas Seiko, its competitor, has a higher productivity value of $0.3 million.

The production costs at Swatch's central offices are excessively high, which is a significant disadvantage for the company. However, unlike its competitors who choose to manufacture in low-priced countries, Swatch remains committed to its Swiss base. Despite this commitment, producing watches in one of the most expensive countries in the world poses challenges.

There are opportunities for Swatch to capitalize on the improved economic status in developing countries like China and India. The rising disposable income


of people in these countries can potentially increase demand for Swatch products. Additionally, as developing countries become more westernized, Swatch's innovative design and artistic approach could give it a competitive edge in these growing markets. Furthermore, with consumers shifting from luxury to affordable products due to the recent economic downturn, there is an opportunity for Swatch to cater to this changing preference. The innovative changes taking place in e-commerce and retail also provide direct marketing opportunities for Swatch.

However, there are threats that need consideration. One major concern is the counterfeit watch market which not only results in financial losses but also damages brand reputation. Studies show that this imitation watch industry causes annual losses of over $1 billion. Another threat lies within Swatch's customer base - urban trendsetters who prefer changes and can be unpredictable. If Swatch fails t

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produce innovative fashion designs, it could experience significant sales loss among its target demographic.

Additionally, Europe currently represents the largest market for Swatch watches; however, due to economic recession and stagnant monetary value development, the position of Swatch watches in this market is being threatenedSwatch watches primarily use plastic and metal as their main materials.

Recent price hikes in crude oil and metals have resulted in increased production costs and a decline in net income.

  • The advancement of smartwatch technology has made them more attractive compared to traditional watches. Furthermore, the target market for smartwatches extends beyond just the younger generation.
  • There is overlap with Swatch.

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