Landscape Business Plan SWOT AnalysisOutside Contributor
Whether you are preparing your landscape business plan, or updating your current business plan, keeping an updated SWOT Analysis provides value to your company.
SWOT stands for strengths, weaknesses, opportunities and threats. There are over three million pages listed on Google when you search for SWOT analysis, so there are plenty of opportunities for you to find resources to turn to. Here is a great one for an introduction and to learn the definitions and applications for a SWOT Analysis.1
Even if your business has just a few employees, a SWOT analysis is still a very useful exercise for any company to go through for no other reason than getting your team on the same page and providing clear thinking to your organization. A SWOT analysis provides your business an internal and external audit of your business.3
The SWOT Analysis is usually put into four different quandrants. The two columns are considered helpful and harmful, and the top row of the matrix (strengths and weaknesses) are internal items, and the second row are external factors which affect your business (opportunities and threats.)
A SWOT analysis plays an important role in developing your strategy. As a leading strategic thinker, Richard Rumelt shares, “A great deal of strategy work is trying to figure out what is going on. Not just deciding what to do, but the more fundamental problem of comprehending the situation.”2 By taking the time to write out a bullet point list of each quadrant you get closer to figuring out what is going on, and gaining a much clearer perspective of what is happening in your landscape business.
You will want to be as specific as possible in determining the items you identify. Your SWOT analysis will be weaker if you are too vague, assign it to the wrong category, too broad or fail to address the right time period for which you are planning – is it for the season, or next several years?4
Start on the two easiest internal categories to complete – strengths and weaknesses. When you are building the inventory of items under each category, you need to be careful that you are actually putting the subject in the right category, and be as honest and as objective as possible. What you list as a strength, could it actually be considered a weakness? For example, you may primarily do residential work and you consider your knowledge of irrigation pumps a strength, but would it be a strength if started to handle larger pumping stations on larger commercial or golf properties?
“In God we trust, all others bring data.” – W. Edwards Deming
You should back-up each item you add to each category with as much data, or specific information as possible. You should have data about your sales, customers, and other specific data points that will help to substantiate each item listed. Of course, you will add more subjective material such as how well your employees are trained on a subject versus your competition, but you need to strive to be as objective and quantifiable with your data as possible. After all, “Facts are stubborn things.”
Just to help get the process going, here are some examples you might put under each category. Make the SWOT analysis an iterative process. Involve members of your team, and be sure to bring an objective person who is willing to challenge each item you put on your list.
- Certified arborist on staff
- Two employees are certified Irrigation Auditors
- Solid working relationship with three of the markets landscape architect
- Positive financial metrics
- Key financial metrics which need to be improved
- No experience in building retaining walls and pavers
- No strong agronomic knowledge on staff for turf and ornamental
- Pricing generally lower than my three biggest competitors
- Need to improve processes in scheduling, and business development
- Presentation material is weak, rely too much on one person for sales
- Widespread drought concerns have created a need for residential sprinkler systems to be refit.
- Improved irrigation efficiency wanted – smart controller and nozzle opportunity
- Trends to more outdoor living spaces, opportunities to grow in hardscapes
- Tree health care services with this pest now prevalant
- BigCo Landscape Company has opened a local office – there will be an impact within the next 12 months
- Scarcity of plant material is driving up costs
- Qualified labor is expensive and very hard to find
- 60 percent of my business comes from just four primary sources of architects and general contractors
Outcomes of the SWOT Analysis
Once you have completed your SWOT Analysis, start to identify the next logical steps your business needs to put in place. Once again to quote Rumelt, “to obtain higher performance, leaders must identify the critical obstacles to forward progress and then develop a coherent approach to overcoming them.” 5 You may have created quite a few items under each category, but try to accomplish just a few of the key business objectives on the time horizon you have defined.
Your SWOT analysis provided you an internal and external audit of your business, which should help you formulate a diagnosis for coherent action steps to move forward. Once again, Rumelt summarizes clearly that “at a minimum a diagnosis names or classifies the situation, linking facts into patterns and suggesting that more attention be paid to some issues and less to others.”6
1“SWOT Analysis”, QuickMBA: SWOT Analysis, 1999-2010,10,Jul,2015, <www.quickmba.com/strategy/swot/>
2,5Good Strategy, Bad Strategy, Richard Rumelt, Copyright 2011, Kindle edition.
3,4 SWOT Does Not Need to be Recalled, It Needs to be Enhanced, Adam J. Koch, 2000, 10, Jul,2015 <www.westga.edu/~bquest/2000/swot1.html>