The pharmaceutical industry is a large-scale industry that has a wide stretched market. It is known for discovering, creating and producing medically usable drugs. This industry has to abide by a set of rules that helps to govern the whole ordeal.
A pharmaceutical industry SWOT analysis will help one to analyze this industry and take necessary steps to improve their standing in the business sector. It also shows what preemptive steps to take in order to make the industry better than ever. For the higher ups in the management sector understanding the SWOT analysis of their company or industry is a necessity.
Pharmaceutical Industry SWOT Analysis
A SWOT analysis is a composition of a company’s strength, weakness, opportunity and threats. Assisting a company to develop a clear image of their business pattern is the main objective of a swot analysis. It clearly lays out all the factors that are involved with the target company. That is why a pharmaceutical industry SWOT analysis is very helpful for this industry.
Primary business strengths, weaknesses, opportunities, and threats will be the main focus of our pharmaceutical industry SWOT analysis. So, let’s take a look at them:
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Strengths of Pharmaceutical Industry in SWOT Analysis
A pharmaceutical industry swot analysis presents only the best and brightest parts of the pharmaceutical industry. This section of the pharmaceutical industry swot analysis will focus on the strength of this industry. Let’s take a look at them:
Efficient and experienced general officers: This industry works on so many different levels that it is very hard for inexperienced personnel to maintain any sub sector of it. So, in order to keep things running smoothly the industry hires highly trained personnel as its executive officers. This in turn maintains the high standard that the industry has set for itself.
Skilled staffs: Any and all staff of the pharmaceutical industry is highly skilled. They are employed only after they have spent a good amount of time on rigorous training. These staff are the backbone of this industry. So having a skilled set of staff surely helps with the industry’s face value.
Wide-spread base of buyers: This industry has a large base of customers. It also produces some common types of medicine, which actually helps support this base. This also ensures that this industry will have enough buyers for their products.
Resource and Labor availability: This industry needs a high amount of manpower and chemical resources. The countries of Asia and Africa can offer up a nice amount of manpower at a very low price. Then again, the countries of Europe and America have bountiful financial resources. They can also buy necessary chemicals for their drugs.
Setting the benchmark: Pharmaceutical industry has set an awfully high benchmark for the medical industry. It is a known fact that the pharmaceutical industry is a subsector of the medical industry. So, by doing its job efficiently the industry is setting a good example of excellence for the medical industry.
Noticeable market presence: The pharmaceutical industry has quite an impressive presence in the market. Its large and intimidating aura often scares away potential competition and lures in many customers.
Weakness of Pharmaceutical Industry in SWOT Analysis
The weaknesses of this industry are the next focus of this pharmaceutical industry SWOT analysis. It is an essential part of the SWOT analysis. These points are usually the ones that are responsible for holding back the industry. These points to improve are enlisted below:
Non availability of modern technology: This industry lacks modern machinery. This makes it rather outdated and dull as customers are always searching for new and improved health care materials. Not to mention with modern tech support the production could be a lot faster.
Lengthy decision-making process: This industry is quite vast and widespread. So, when taking a new and/or revolutionary decision, it may take a while before it is properly executed. This slows down the whole process. The main cause is the lengthy decision-making process of the industry. As the companies have their own board of directors and chairmans they can hardly agree on anything in a short period.
Low profitability and low profit margins: As the price is quite high for the resources in this sector, profits are quite low more often than not. And it’s not that it is only the case for some of the companies. Almost all the companies have low profit margins. This causes the industry to fall behind on the ground of wealth.
Low staff morale: The staff in this industry doesn’t have much motivation. This is the reason for low rates of production. Because many psychological articles suggest that if the morale is low or non-existent the performance of humans takes a heavy blow. So low staff morale is an issue.
Opportunities for Pharmaceutical Industry in SWOT Analysis
At this part of our pharmaceutical industry SWOT analysis, we will focus on all the good points that are there but are yet to be utilized. These are enlisted below:
Government support: This industry is often favored by the government. So, they get all the support and help they need from the government. It is also the factor for which the industry is flourishing to this day. The laws and taxes are often in their favor.
Growing space: This industry is still in its growing phase, according to the Life Cycle of an Industry. So, it can still go a long way and spread its wings further apart. So, it can still take control over the market, given the right marketing and advertising.
Financial support: Along with the government, many insurance companies are also favoring this industry. They have reasonable conditions and rules for them to follow. Also, the interest level is very low for them.
Patents: The pharmaceutical industry develops new and effective medication. If one company creates it, it can patent that product themselves and earn a handsome amount of profit. This gives the industry a chance to grow.
Global market: Globalization has made the world closer than ever. This includes all the customers. The pharmaceutical industry is showing a promising future in the global market. If this works out well, the deficiency of proper resources and low profit margins will be no more.
Threats for Pharmaceutical Industry in SWOT Analysis
For each and every SWOT analysis having a fresh and unique perspective regarding the factors that are harmful to the industry is a must. Only due to the fact that without sharpening their defenses against these, the pharmaceutical industry will not be able to rise above its competitions. In the pharmaceutical industry SWOT analysis threats are taken very seriously.
Currency devaluation: In the current society’s currency devaluation has taken a turn for the worse. This is affecting the pharmaceutical industry in a grim manner. It makes the whole ordeal a lot harder than it already is.
New competitors: Since globalization, the rivaling industries are increasing. Many people are interested in the Ayurvedic industry, homeopathic industry and many others instead of medicines. This poses a great threat to the pharmaceutical industry.
Insufficient power supply: The pharmaceutical industry requires a huge amount of power. However, to supply this power on a large scale is a problem. As a result, many companies of the industry don’t get enough power to carry out their necessary routines.
Inflation: The inflation of prices is an undeniable evil that is ever present. Especially in a sector is where raw materials are pricey to begin with, inflation of price just adds salt to the wound. Suddenly the necessities are out of reach for many companies in the industry. This causes the production cost to skyrocket and suddenly the profits are lower than ever.
Pharmaceutical Industry SWOT Analysis Overview Template
Conclusion and Recommendations for Pharmaceutical Industry
The following recommendations will focus on improving the weaknesses or neutralizing the threats to the pharmaceutical industry. However, there are some points that could use some extra work:
- The industry needs to adjust its decision-making process so that it takes less time.
- They need to fix their budget so that there is more budget for marketing and research purposes.
- They need to be more staff-friendly to keep their morale high.
- The board of directors needs to be more engaged.
- They also need up the ante in the marketing department.
Pharmaceutical industry SWOT analysis has made very clear points regarding this industry. This pharmaceutical industry SWOT analysis captures the core of all the internal, environmental, political and economic prospects of the said industry.
It is obvious that the main strategy in play here is utilizing the government support. The pharmaceutical industry SWOT analysis illustrates what the industry excels in, what changes need to be made and how can this industry be better.
Understanding this industry’s SWOT analysis will result in gaining a deeper perspective on this industry and its background. This will also help one to realize the depth of the services that the pharmaceutical industry provides.
Hopefully this SWOT analysis has helped people to gain new insights on their business strategies.