Saturday, June 8, 2019
Swot Analysis Essay Example for Free
Swot Analysis EssayTop Gloves strengths and the opportunities available to it outweigh its weaknesses and the threats to its business. Strengths. One of Top Gloves competitive edge is its size of it and wide product range. This is in line with groups strategy of becoming the one-stop glove sourcing centre for glove users. Its size confers on it economies of scale and excessively the ability to expand upstream. Weakness. We can identify only one weakness in Top Glove. Being an OEM manufacturer, it does not induce any products that carry its own brand name. Its size and strong growth could also work against its favour as it makes it more difficult for management to salvage a close eye on all its operations. This is demonstrated by the recent illegal labour issue. Opportunities. Opportunities abound for Top Glove. Its expansion plans will enable it to ride on the increasing global demand for rubber gloves and the outsourcing trend by MNCs. Top Gloves size also places it in a goo d position to undertake MampAs, which are likely given our belief that the local industry will experience more consolidation. Threats.The glove industry has meek barriers of entry as only RM1m-1. 5m is needed to start a line. That said, although it is cheap to enter the industry, new players may not be competitive as they have a bun in the oven to distinguish themselves from other players and need to compete in terms of volume in order to enjoy economies of scale. Aggressive expansion by the bigger players also poses the threat of an industry glut. Price and availability of latex are also sources of concern given that latex makes up more than 50% of the groups costs. To mitigate the risk, Top Glove has expanded upstream by acquiring its own latex processing plant.
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