Every organization needs to make an analysis to increase awareness of the factors that go

into organization decision. It also helps organization to find out whether organization is
doing well or otherwise. There is various analyses that need to be made including external
and internal analysis. This analysis also can be called as SWOT analysis. SWOT analysis is a
framework for strategic planning and strategic management for organization. SWOT analysis
is created by Albert Humphrey, who used this method in 1960s and 1970s at the Stanford
Research Institute. The main purpose SWOT analysis is developed for business and it has
been adopted by organizations of all types as brainstorming aid to making business
decisions.SWOT stands for strengths, weaknesses, opportunities, and treats. Strengths and
weaknesses are internal factors which is related to organizations itself while opportunities
and treats is external factors which is related to environment outside the organization.
Strengths in SWOT analysis is an advantage that can add value to organization and make
organization different from competitors in the same field. It also a resource that can be used
by organization to achieve objectives or goals. IKEA company strength that can be seen is
affordability. The affordable price of IKEA product has been strengths to that company.
Nowadays price of furniture is overpriced that cannot be afford by some people.
Furthermore, the wide range of design the provide is affordable for the average of people,
after purchasing the product, they have service to transport your product to customers
home which reduce customers costs even more. Besides that, the price that IKEA offer is
comparable with the quality that they offered. Other than that, with the price they try
maintaining the same level of cost effectiveness that cause customers coming back for their
product. The company always try searches ways to cut down costs of the product without
effecting the standard product that have been set by IKEA company and consumers have
come to expect. The ways or innovations include new materials that provide more to
sustainable environment and using new ways of packaging, handling, and transporting

material. Consequently, IKEA strengths is countless design that be offer by them to

consumers. As we know when people talk about furniture and cool or variety design that
can be suit all people taste they will think IKEA company without hesitation. IKEA shows
people that consumers can have all design in one place with a good and quality product with
a good price. From the start of designing a product, IKEA make certain that product can be
go with in all feature. IKEA designers make sure that to they create stylish, newly, and
modern designed products and as well it goes further that a physical decoration. They also
try to bring idea to consumers how to style the furniture with other product with different
design and style that suit consumers’ taste. The product is developed for easy transport and
installation. IKEA try to make everything easy to their customers. They offer the product in
pieces and customers must install the furniture by themselves. It because it can make things
easier to bring home and leading to gigantic cost reductions.
The next strength is Brand recognition that IKEA company receive from the
consumer. IKEA has been in the market since 1914. It long enough to build a good
reputation and it shown they succeed to have it. IKEA company one of the most
acknowledgement and well- known furniture product brands worldwide. IKEA has been
reported that more 600 million customers annually. IKEA product has been offering to 38
country including Malaysia and 332 stores. One of the identities that been show IKEA to
customers is low- cost furniture options and that identities attract people and knowledge
that IKEA is a global well- know company. IKEA has a very strong marketing team that focus
on market research and enabled them to into a new market without a problem. It shows
that IKEA is still a strong competition and remain pacesetter.
Weakness is disadvantageous when compared to something else, in other words
weakness is negative things and unfavourable in organization. Weakness can damage its
market share and brand image itself. IKEA company has some weakness including bad press
and low-quality product. Bad press that happens in IKEA company is that has reported in
media that IKEA had negative issue with their employee. Employees make a fuss about poor
treatment that they receive from the company such as due to long working hours. Apart
from that IKEA has been condemn advertising practices. The worst part is children being
hurt or killed in link to IKEA furniture. IKEA product also led to injuries because customers
who do not have any experience install a furniture especially women will be vulnerable to
injury. This weakness can affect customers trust and loyalty that they put in this company.
The fact that IKEA company is a global company makes it difficult to always to
control the quality and standard product. IKEA’s need to produce low price product. It hard
to ensure with the low price and high-quality product to be produce. This becomes second
weakness that IKEA and customers must face. This is the main concern that should IKEA
taking care to avoid losing customers. Good quality product has been main priory to
customers in term making buying decisions. In past five years customers has start reported
their furniture breaking down just few days after install the product. There has reported
that IKEA product cannot be used after 3 years because low quality. This can happen
because IKEA at a loss to find compromise between cost reductions while maintaining good
quality product and affordable with the price that they offer to the customers. It because in
this present context raw material, cost of producing, and cost salary has increase and impact
the profitability of the company. It hard to maintain quality in this present context of
increasing cost and keep the standard product that customers want. In addition, IKEA not
only have Strengths and Weaknesses, but have a Opportunities and Threats. Opportunities
refer to favourable external factors that could give an organization a competitive advantage.
The element of opportunity is usually created in the early days of building a business. This is
because businesses are formed based on opportunities or opportunities to make a profit.
The opportunity includes a list of anything that allows businesses to survive and be accepted
in society, both in the short and long term. Based on the IKEA, the opportunities that the
IKEA company have is in terms of franchises.A franchise (or franchising) is a technique of
dispensing services or products regarding a franchisor, whoestablishes the brand’s
trademark or trade name and a business system, and a franchisee, who pays a Royalty and
frequently an preliminary charge for the proper to do commercial enterprise beneathneath
the franchisor’s call and IKEA is one of the enterprises that has done the franchise system.
That means that many groups of companies work together under one IKEA brand. Inter IKEA
Systems B.V. is an IKEA franchisor that continues to develop the IKEA Concept and ensure its
implementation in all markets. Franchisees run a retail business every day and pay a
franchise fee to do so.The franchisor is accountable to constantly increase the IKEA Concept
and make sure its implementation in new and present markets. Meanwhile, franchisees
provide valuable input based on consumer and market insights. This system is referred to as
an opportunity to IKEA because each year the companies in the franchise system paintings
collectively to release extra than 2000 new products, broaden new methods to make
purchasing at IKEA extra convenient. The IKEA franchise system allows for international
expansion, while protecting the IKEA Concept. One of the franchisees is IKANO in Malaysia,
Singapore and Thailand. The franchise system used can provide opportunities for the IKEA
company to expand its business, expand the market quickly and benefit from the economic

sector.
 Not only that, another opportunity that can grow an IKEA company is broad market
targets.A goal marketplace is a collection of human beings which have been diagnosed
because the maximum likelyability clients for a product due to their shared traits along with
age, income, and lifestyle. IKEA is one of the businesses with a strategic area. IKEA's market
target is clearly seen as IKEA is a business that sells a variety of kitchen and home goods,
electronics, and many others. The area is so strategic especially the urban area, many
people buy household items in the area. IKEA carries out a strategy to meet the needs of its
target market, by offering a variety of quality furniture at relatively low prices. The target
market is students and young couples who have relatively low incomes, who certainly do
not want to spend a lot of money to buy furniture. IKEA understands that young families
need furniture to fill their new homes, yet they do not have a lot of money to do so.
Although the price of their products is cheap, but the quality of the products is still good.
Although, IKEA also has a threat in growing this business. Threats are negative external
factors that do not benefit your organization.They may be something which could motive
harm on your company, product, or profitability. So, the threat that exists in the IKEA
business is market forces more competitors entering the low-price household and furnishing
market. For example, Amazon, MR. DIY, and H&M. They also have very cheap household
items for customers' use. They have received a large response from customers to buy in
their stores because not all districts have Ikea business but MR. DIY has businesses in several
districts. So, that is one of the threats to IKEA to increase the profitability of their business.
However, IKEA is aware of his increase in competitors and therefore has anew solution in
order to keep their competitive advantage. IKEA’s new aim is to focus more on the quality of
their products, while emphasizing on the importance of manufactures to pare costs in order
to meet the changing consumers’ demands. By responding to the consumers’ demands,
IKEA will be able to maintain their competitive position in the furniture and household
market. The other threat is economic factors could be a potential threat for IKEA, such as a
recession, which economic decreases the spending power of consumers. Consumers are
unable to buy freely because it is possible that the business will increase the price of their
goods which will be because the country's unstable economy causes customers to over-
choose to spend. Existing customers may also rethink their spending structure which will
result in fewer of their money releases. IKEA may also be forced to reduce their employees
by laying them off. This is so that the business will not suffer losses, but it will be
detrimental to the employee. With the economic downturn, all business spending will
increase as well. thus, this economic factor will pose a threat to IKEA as it will affect the
development of their business.