SWOT analysis

 

Strengths

 

Market dominance: Syngenta own 9 percent of the world’s market share in seeds, meaning that they are third largest agribusiness. This gives them a huge competitive advantage and highlights their expertise in the field.

 

Global scaled: A global presence keeps the company up to date with the different challenges facing growers and to the downstream needs locally. It allows for development and evaluation of future products under local conditions as well as partnership with local scientific expertise.

 

Innovation: Syngenta have over 5,000 people at 180 R&D centers across the world, and further investment is made in the development of their people, technical capabilities and partnerships. They are continuously evolving their products and teaching their teams new skills to keep up with market demands.

 

Target sector: Over half of Syngenta’s sales are in emerging markets (Annual report 2013). Emerging markets are sought by investors for the prospect of high returns, as they often experience faster economic growth as measured by GDP.

 

Reputation: Syngenta have an excellent reputation in the agrochemical sector, this is due to their pre-established business and science background, as he company was formed by the merging of two chemical companies: Novartis and AstraZeneca. Hence, Syngenta inherited the strengths and traditions of two excellent companies and was able to grow from there.

 

 

 

Weaknesses

 

Controversial Projects: Syngenta has placed huge investments in GMO (genetically modified seeds), a concept which is controversial. Hence, this may damage the brand image. Syngenta experienced particularly bad publicity in October 2007, when the Brazilian Landless Workers' Movement led a group in an occupation of one of the company's seed research farms. A protestor and security guard were killed, and others wounded.

 

Target Market Sector: As previously mentioned, over half of Syngenta’s sales are in emerging markets. However investments in emerging markets come with much greater risk due to political instability, domestic infrastructure problems and currency volatility.

 

Brand image: Syngenta is a relatively new company (founded 2000, whereas leading company in seed shares, Monsanto, has been around since 1901); so has not had the same time to develop relationships/experience in the field.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Socio-cultural: Political awareness for the issues discussed about African agriculture are topical at this time. There could be potential for increased awareness and urgency to respond to these issues if given enough attention by major authorities (e.g. the United Nations). Realistically this will only happen if there is shortage in food output following climate change or natural disaster. Such events would lead to the governmental aid for this project and other related projects.

 

Economic upturn: The economic climate for the produce may reach highs in the time frame associated with the project. Further analysis would give an idea of the repercussions of such a turn of events. It may work in favour for the project by allowing new markets to open and enticing new investment opportunity. However it may lead to the flux of new competition into the market with more sophisticated agricultural methods and less ethical considerations (ultimately giving them a competitive advantage at the retail level).

 

 

 

Threats

 

Competition: Firms which are heavily established in the market may undertake similar projects with better strategies and funding. This would lead to Syngenta’s project becoming undermined.

 

Market: Slow market growth is anticipated for the producers (see annual report). This is why the project is manifested with long term goals. However this could be a potential downfall for the initiative and could lead it to rejection by the shareholders.

 

Economic Downturn: The economic climate for the produce may reach lows in the time frame associated with the project. This may lead to decreasing market share prices and ultimately the failure of the project.

 

Technological Threat: Advance in technology for the agricultural industry may be detrimental to the project. Essentially the methods and inputs would have to be updated which would cost capital.