START YOUR HORSE BUSINESS WITH A SWOT ANALYSIS
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. A SWOT Analysis is a method of assessing a business plan developed by a professor of business and management at Stanford University in 1960‘s-1970‘s. The simplicity of the form makes some people initially underestimate its usefulness. The SWOT Analysis has now become a standard part of any formal business plan and your readers (future investors or lenders) will look for this section of the plan. When used properly, a SWOT Analysis is a good tool for you to use to examine your own business. A SWOT Analysis can be used for any project. It need not be used only for the entire Business Plan. It can be limited to an smaller project such as whether to add a new service or product or undertake the expansion of a building.
DEFINE YOUR PROJECT
Start your SWOT Analysis by defining your project at the top of the page. Make the project definition specific and clear. This is your goal and measuring stick. You want to be sure that the Strengths, Weaknesses, Opportunities, and Threats relate as directly as possible to the project that you are undertaking.
LIST THE RELVANT FACTORS
A SWOT Analysis consists initially of a listing of INTERNAL (Strengths and Weaknesses) and EXTERNAL (Opportunities and Threats) factors. Internal factors relate to factors directly ties to your business. External factors are things that occur or may occur outside of your business that can affect the success of your business. In this initial listing, you include every factor you can categorize.
PRIORITIZE THE LISTS
After you have listed the factors you can think of in each category, you need to examine each listing to give it a PRIORITY as it relates to the business you are planning. What is most important, next most important , and so on. You may have listed a Strength that is relatively unimportant in what you are trying to accomplish--it may still be a Strength--just a lower priority strength. Do the same with Weaknesses, Opportunities, and Threats.
Note: Your Priority Listing could change depending upon the particular business you are planning. You may have a high priority Strength or Threat for one type of business that is ranked lower in priority for a different type of business.
MATCH AND CONVERT
Once you think that your lists are fairly well Prioritized for the type of horse business you are planning to start, you want to Match and Convert. Matching and Converting is the process of producing a plan for an outcome that you want. Can you Match a Strength to an Opportunity? In other words, does the Strength you have listed actually promote and advance the Opportunity? If not, how could that happen? Does this reveal a new Weakness you may not have considered?
Can you Convert a Weakness or Threat? If you have identified a Weakness about yourself or your company, can you Convert that Weakness into a Strength. You could typically go about this in three ways: First, is there outside or professional talent you can hire permanently or on as as-needed basis to address this Weakness? Second, can you (or the company) undertake Training or Educational Programs that eliminate this weakness? Third, can you expand a service or product line to produce an Opportunity or Strength?
MINIMIZE A THREAT
There may be an external Threat that you cannot fully eliminate or convert. What steps can you take to Minimize this Threat? Is there a very specialized product or service area that you could choose not to sell or undertake that would avoid a governmental regulation? If a particular product or service is has the potential to involve environmental laws or regulations, can you minimize that aspect of your business?.
A SWOT ANALYSIS IS ONGOING
One you go through this listing and analysis process and have identified Strengths, Weaknesses, Opportunities and Threats; have undertaken a plan to Match and Convert, and have formulated the steps you will undertake in your Business Plan to deal with these factors, you will be ready to include your SWOT Analysis in a formal business plan. Just as your Business Plan is an ongoing document that you will periodically update, so is your SWOT Analysis. If you take in a partner, establish a new product or service, eliminate a weakness, or a new law or regulation will affect your business, update your SWOT Analysis to reflect changes in Strengths, Weaknesses, Threats and Opportunities. Use the same SWOT Analysis to reassess your Business Plan or decide if you should undertake a new product line or service.