SWOT Analysis of Himalaya Drug Company [Explained]

SWOT Analysis of Himalaya Drug Company gives emphasis on strength, weakness, opportunities and threats. Strength and weakness are the internal factors opportunities and threats are external factors.

SWOT Analysis is a validated framework that enables a brand such as Himalaya Drug Company to evaluate its business & performance against competitors and the industry.

Himalaya Drug Company was founded in 1930. It is based in the city of Bangalore, India. It has a delivery network set up in more than 90 countries across the globe.  Himalaya drug company is a close competitor of Patanjali India. Himalaya is a renowned brand in Ayurvedic product market.   

swot analysis of himalaya drug company

Strengths in the SWOT Analysis of Himalaya Drug Company

Strength in the SWOT Analysis helps to understand the core business areas where it outperforms and has a competitive advantage in the market. Strengths are generally the core competence of the business.

  • Place is a huge good factor for the company – the place provides an extra bonus to the company as it is situated in the foothills of the Himalayas, which gives a totally different message to consumers that it is organic in nature.
  • Consumer Experience is optimistic – the identity of the company produces a positive experience in the eyes of the customer and, once again, the goods are made in the foothills, which further strengthens the confidence in the brand.
  • First Mover Benefit – The company has jumped into competition by becoming the number in the frozen food service market.
  • Distribution and Reach: In almost every state, Himalaya Drug Company has a large number of dealers, backed by a strong distribution network that ensures that its goods are readily accessible to a large number of consumers in a timely way.
  • Cost structure: The low-cost structure of Himalaya Drug Company allows it to manufacture at a low cost and to sell its goods at a low price, making it affordable to its clients.
  • Return on Capital Expenditure: In the past, Himalaya Drug Company was able to effectively produce positive returns on the capital expenditure it spent on different ventures.
  • Automation: has enabled more effective resource utilization and cost reduction from various stages of production. It also enables its goods to be consistent in quality, and offers the flexibility to scale up and scale down production as per market demand.
  • Trained labor force: Himalaya Drug Company has invested heavily in its workforce training, which has resulted in it hiring a significant number of professional and motivated workers.
  • Entering new markets: Creative teams from Himalaya Drug Company have helped it to come up with new products and reach new markets. In the past it was successful, in most of the initiatives it took in new markets.
  • Social Media: Himalaya Drug Company has a strong social media presence with over millions of followers on the three most prominent social networking platforms : Facebook , Twitter and Instagram. It has a high degree of customer engagement with low customer response time on those channels.
  • Website: Himalaya Drug Company has a well-functioning and engaging website that attracts a huge amount of traffic and sales on the internet.
  • Product Portfolio: Himalaya Drug Company has a broad selection of products where it sells products in a wide variety of categories. It has a range of exclusive product deals which competitors don’t have.
  • Himalaya Drug Company geography and location give it a cost advantage in servicing its customers as compared with the competition.
  • Research and Development: While Himalaya Drug Company is investing more than the industry’s average expenditure on research and development, it is investing much less than a few market leaders who have had a major advantage as a result of their revolutionary goods.
  • High Day Sales Inventory: The time it takes to buy and sell goods is higher than the industry average, which ensures that inventory builds up adding additional costs to the company.
  • Rented Land: A large proportion of the property owned by Himalaya Drug Company is leased instead of bought. It has to pay huge sums of rent to add to its expenses on those.
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Weaknesses in the SWOT Analysis of Himalaya Drug Company

This is the pain field in a company where it has no money or expertise. Business must work on these areas so that they are not left out of competition. While there may be any or other vulnerability, it should not be an environment that keeps the company out of the competition.

  • Big Working Capital – Company requires huge capital to run and thus there is a constant demand for cash flow that is needed to provide end goods to the consumer.
  • High dependency on raw materials – There is a high dependence on raw materials which are seasonal in nature and thus the non-availability of raw materials adds to the hindrance in the manufacture of products and therefore adds to the cost of food as raw materials need to be over-cultivated and processed in order to be conserved.
  • High Crop Sensitivity – Crops are highly sensitive to preservatives and pesticides used to enhance cultivation, and therefore there are high costs involved in the production of raw materials as there are potential crop losses.

Opportunities in the SWOT Analysis of Himalaya Drug Company

This helps to understand what other things a business can do with current skills and resources. It helps the company to know the areas where it can expand and take the lead in order to diversify the business and expand the customer base.

  • Global markets – Industry can grow internationally as there is a ready demand for organic goods. Customer preferences are changing and, as a result, proper marketing can bring great benefits to the business.
  • Changing Demographics and Segmentation Factors – Sector may be advantageous due to the changing lifestyle of customers who are leaning towards organic goods and are thus on the rise in the industry.
  • Marketing and promotion – The business is born in nature and, thus, through proper marketing and promotion of the goods of the business, it is possible to grow and place the goods in a better way by using organic products.
  • Growing Demand of Ayurvedic Products: In India and world demand of ayurvedic products is increasing year by year which is a great opportunity for the company.
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Threats in the SWOT Analysis of Himalaya Drug Company

  • This article helps to explain the sectors that could have an impact on industry in the future or immediately. Business must therefore prepare itself to deal with the threats in the market landscape. Competition or an growing number of competitors in the market with the same value proposition is a challenge to company as it directly decreases consumer base and sales
  • Inventory costs are high – Market expenses are growing high because the cost of production is high, since it requires a massive investment in seed growth and so the cost of inventories is high.
  • New entrants – While the sector is evolving and a lot of study has taken place in this area, a range of well-established foreign competitors have been drawn to join the market and will thus pose a challenge to company.
  • High Cost of Goods – There is a financial downturn in the world and, since products are expensive, customers need a lot of pressure to realise the value of products so that they can use them.

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"SWOT Analysis of Himalaya Drug Company [Explained]." Projects4MBA [Online]. Available: https://www.projects4mba.com/swot-analysis-of-himalaya-drug-company/4715/. [Accessed: October 24, 2020]
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