Chapter 46- SWOT Analysis

Question 1

Internal audit

Answer 1

• Analysis of business itself and how it operates
• It attempts to identify the strengths and weaknesses of its operations such as products, finance and production

Internal- what may be identified by the internal audit
• Strengths- e.g. unique selling point, good workers, loyal
customer base,
• Weaknesses- e.g. poor cash flow and opposite of above

Question 2

External audit

Answer 2

• An audit of the external environment which a business finds
  itself, such as market, government restrictions etc.

-It analyses the market or markets in which the business operates
such as the size and growth potential of the market
- It should also analyse the competition in the market and the
nature and strength of the competitors

External-
• Opportunities- e.g. new overseas market, fall in cost of raw
materials, fall in exchange rate
• Threats- e.g. a new entrant into the market, opposite of
above

Question 3

Why use SWOT

Answer 3

To identify threats and benefits in order to plan for the future to minimise damage or maximise profit (Strengths, weaknesses, Opportunities and threats)

Question 4

Trade association

Answer 4

An organisation in which all of the members are all in the same trade or industry