SWOT Analysis of Manufacturing Industry

by Stephanie Faris - Updated June 28, 2018
Mechanic And Female Engineer Talking in Factory

SWOT Analysis is a tool used by businesses and marketing professionals to improve operations and identify risks. An acronym for strengths, weaknesses, opportunities and threats, SWOT can also be used to compare a company against its closest competitors. SWOT analysis for manufacturing industry businesses involves analyzing each of those elements, generally in a plant environment. The industry as a whole has strengths, weaknesses, opportunities and threats that can be identified, then applied to an individual business.


In any SWOT analysis of an industry, it’s important to look at the unemployment rate. The manufacturing industry has added nearly 300,000 jobs under the Trump administration, a higher rate than any other industry. The industry’s extreme job growth means more workers will be drawn to the industry, helping plants across the country remain competitive. Much of the growth was in durable goods manufacturing. The administration has placed a high priority on boosting the industry, offering incentives to encourage growth. This is likely to continue to draw top talent who are aware of the many opportunities available in the industry.


Unfortunately, manufacturing falls short when it comes to evolving over time. Many plants rely heavily on outdated methodologies, harming productivity and slowing everything down. Savvy companies consistently search for better ways to do things and, as a result, they remain competitive. One of the most popular practices today is lean manufacturing, which has management striving to find the most efficient ways to do everything. When combined with data analytics, plants can often identify where changes need to be made and tweak their strategies accordingly.

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A SWOT analysis of manufacturing reveals that the industry has some areas that are growing more rapidly than others. Transportation equipment has seen extreme job growth, along with fabricated metal products. Job demand is also high in food and beverage manufacturing. Even the auto industry, which suffered some setbacks in previous decades, is seeing impressive job growth.


Threats also keep the manufacturing industry alert. Primary of these is the competition the industry faces from overseas companies. China is especially tough to beat, since it’s able to keep manufacturing costs so low. Even as the U.S. seeks to save money through further use of robotics, for instance, China is following, with plans to cut their own costs even more. China also relies heavily on a large group of suppliers for each product it assembles, and the U.S. has yet to be able to duplicate that infrastructure.

About the Author

Stephanie Faris is a novelist and business writer whose work has appeared on numerous small business blogs, including Zappos, GoDaddy, 99Designs, and the Intuit Small Business Blog. She worked for the State of Tennessee for 19 years, the latter six of which were spent as a supervisor. She has written about business for entrepreneurs and marketing firms since 2011.

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