In today’s global manufacturing supply chain, there are many vendors to
choose from.
By analyzing the strengths and weaknesses of potential vendors, you can
select the best manufacturing solution for your project. And the best way
to do that is through a supplier SWOT analysis.
A supply chain SWOT analysis asks us to examine the Strengths, Weaknesses,
Opportunities and Threats in any given situation.
Strengths – The things that give you an edge over competitors.
Weaknesses – The things that put you at a disadvantage compared to similar
companies in your field.
Opportunities – External possibilities that can be used to help you grow.
Threats – External factors which could pose a danger.
It’s a concept that originated at Stanford University in the 1960’s by
business and management consultant Albert Humphrey who was studying the
reasons corporate planning failed.
He came up with something called SOFT analysis: What is good in the
present is Satisfactory, good in the future is an Opportunity, bad in the
present is a Fault, bad in the future is a Threat.”
Over time, SOFT evolved into SWOT, but the concept remains the same, a way
to gauge current and future positives and negatives.
By conducting a SWOT analysis for a manufacturing company, a company can
determine the pluses and minuses of a contract manufacturer and see how
that manufacturer can help reduce inventory costs.
The right vendor can improve your quality by shrinking the number of
product failures, help lower holding costs and purchase prices. The choice
of supplier is a key part of supply chain management, and as such,
deserves careful consideration.
Let’s take a look at some of the questions you should ask for each section
of the analysis.
Strengths
When you look at the potential contractor manufacturer, what strengths do
you see?
Do they have extensive design and engineering experience?
Do they have access to the right vendors and materials to allow them to
turn around orders quicker than other companies in their field?
Have they earned a good reputation for service and support?
Do they have the type of purchasing power that gives them better prices on
materials?
Weaknesses
And no matter their strengths, any company might have weaknesses. For
example:
Does the company have manufacturing experience relevant to your specific
product needs?
How long does it take for them to transform new designs into products?
How attentive are they to quality control?
Opportunities
In addition to strengths, a good contract manufacturer might bring with
them extra opportunities to help your company. For example:
Can they lower the cost of inventory ownership and help you lessen freight
costs?
Do they have expertise in certain technologies that help you enhance your
product?
Threats
When scrutinizing threats in a SWOT analysis for supplier selection for
your supply chain, look for things like:
Supply chain disruption
Excessive lead times
Inventory float, and the difficulty of tracking it.
Mars may not be the best fit for every project. But we can tell you our
strengths when it comes to the swot matrix. When you hire Mars
International, you are selecting a contract manufacturer that has
manufacturing expertise backed by extensive design and engineering
experience.
We provide the supply chain infrastructure that allows you to bring
products to market with speed and efficiency, with a sharp focus on
time-to-market, lowered cost and quality control. Contact us today to
learn more about how we can help strengthen your next project.
