Ryanair SWOT analysis

A SWOT analysis is a development which arsehole be undertaken in order to identify an organisations, proceedss, or services internal Strengths and Weaknesses, and in like manner its external Opportunities and Threats. A SWOT analysis focuses on the micro environment of one of the higher up entities, i.e. factors which the organisation has some control over. Business Management scarper Text, AIT Ireland (2013-20134).SWOT analysis of RyanairStrengthsWeaknessesLowest Cost Base of some(prenominal) europiuman AirlineStrong financial proceeding despite underway economic climate InnovationNegative Public PerceptionOver-reliance on seasonal worker trends to gain profit marginsPoor customer serviceOpportunitiesThreatsNew respiratory tract routes throughout EuropeOpportunity to increase foodstuff ShargonCurrent economic climateIncrease in fuel chargesNatural events and disastersStrengthsAccording to safaribooksonline.com/book/sales-and-marketing, operating as a low- embody enter prise can be a strength for companies, as it whitethorn incentivise an increase in demand for a particular point of intersection or service, in relation to its competitors. Low cost providers argon a popular choice for financially conscious consumers who do not shake off any/little loyalty towards the product/service in question, or for consumers who wish to obtain a product/service at the utmost available price. For Ryanair, creation a low cost bon ton has been enormously beneficial, as they have almost entirely built their current reputation on being a low-cost airway.At present, Ryanairis the lowest costing respiratory tract in Europe, one third lower than its ne arst rival, easyJet. Maintaining a loaded financial effect is a major factor to the success of any business. According to http//www.investorwords.com, organisations base their important decisions/strategies the basis of their financial performance. Maintaining a reasoned financial performance allows companies to scram revenue. In ground of Ryanair, despite the recession, the bon ton has not only continued to make a profit, but is also Europes most profitable airline. In 2013, the company forecasted that they would generate 540 million, a 7% increase over the previous years phase.According to http//businesscasestudies.co.uk, Companies must innovate in order to keep ahead of their competitors. This intend that companies must focus on incorporating fresh approaches and ideas to their business model in order to remain at the top of their respective field.Ryanair has excelled in being an innovative company, and has changed the outlook on the airline industry through strategies such(prenominal) as pushing the low cost slogan, removing free catering for customers on their flights, and also by moving away from travel agent bookings to net profit sales. Through innovation, Ryanair has revolutionised the short-haul industry.WeaknessesNegative public perception/relations can be deadly to an y enterprise, as it can drop dead to a loss in existing customers, whilst also acting as an obstacle in obtaining impertinently ones. Once a companys name has been tarnished through curt PR, it can be a struggle to regain any popularity lost. Although Ryanair atomic number 18 noneffervescent the straining airline in Europe, Chief Executive Michael OLeary has received heavy criticism for numerous PR campaigns, which has given the company a poor reputation amongst many individuals. Many businesses are reliant on specific snip of year in order to increase their profit margins.Companies which provide winter wear, such as the Great Outdoors, pass on thrive during Autumn/Winter, as the demand for jackets, gloves, etc. will be at its highest during these seasons. For Ryanair, the company is heavily reliant on its summer performance (particularly July-September) in order to boost profit margins. Since 2008/2009 Ryanair has consistently make losings in at least one of the winter quar ters, whereasthe company has made an overall profit in every year for the last 10 years. Building positive relationships with your customers isnt just good practice it will in conclusion improve your bottom line. pack Caan, 2013.Maintaining a positive relation with its customers is a vital component in the majority of successful businesses, as, according to James Caans article in The Guardian, Customers are the most important addition to your business and looking after them is essential to your success. Welcoming feedback, (positive and contradict) confabulation between a business and its customers, and handling customers complaints are all exemplar of good customer service. However, according to a recent survey conducted by Which? Magazine in the UK, Ryanair was voted as being the worst in terms of the quality of customer service walked by Britains 100 biggest firms, with ply Knowledge, attitude, and their ability to handle complaints cited as the main issues.Opportunities The opportunity to expand/offer a greater range of service is something which any business implicated in growing in stature will be fire in. As a company grows, they have control of the industry which they are competing in, can often dictate prices, and may also benefit from economies of collection plate (lower unit costs by producing more). http//www.bbc.co.uk/schools/gcsebitesize/business/aims/sizeandorganisationrev1.shtml For Ryanair, the opportunity to operate sensitive routes throughout Europe is something which the organisation is always improving on. According to http//www.ryanair.com, from April 2014, the airline will expand 85 new routes operating out of capital of Ireland alone, in which the company hopes to generate 1 million new passenger fares from.Inter-linked with the above paragraph, increasing its market share/market growth is an different(prenominal) opportunity which looks achievable for Ryanair. According to http//centreforaviation.com, the European aviation sector is still a growing industry, which already suggests that Ryanair may increase its share of the market. However, as Ryanair is already Europes leading short haul airline and lowest cost producer, the steps are firmly in orient for this opportunity to become a reality. Ryanair targets obtaining 120 million passengers by 2022. The current economic climate has had huge implicationson businesses on a ball-shaped scale, with many companies, (such as Dell) having to relocate in order to cut costs.Also, as consumers are more aware of the impacts of over-spending during a Recession, many businesses have proverb a fall in demand for the product/service which they are offering. However, operating as the lowest costing airline in Europe has had an overwhelmingly positive effect on the company. Although Ryanair offers no frills, many financially conscious people have decided to opt with Ryanair over other alternatives (such as Aer Lingus) during the current economic climate, as they o ffer a cost effective service. This is evident by the face that Ryanair has become Europes most profitable airline.ThreatsAccording to http//www.legalzoom.com, any costs imposed on a business (both internal and external) can have an effect on how a company have choose to allocate its budget, and higher costs may also lead to a business cutting back on certain expenses in order to remain in a bouncing financial position. According to Ryanairs Chief Financial Officer Howard Millar, Ryanairs single largest cost is fuel costs. To combat against these rising costs, Ryanair has chosen to lento down the speed of their air-crafts, which has added an estimated two minutes onto every hourly flight.This figure may seem small, but for customers who travel with Ryanair on a buy at basis, this could lead to a fairly substantial amount of extra time consumed, with may lead to some disgruntled customers. Siraj Datoo, 2013. According to http//www.exponent.com, Natural disasters, whether they are hurricanes, typhoons, tsunamis, or monsoon-related flooding, are all factors that can affect the operations of businesses worldwide. The above factors can have major implications in business operations, as they can restrict trade between business, and they also may lead to products/ set forth being damaged.For Ryanair, natural disasters such as a volcano eruption, could lead to a huge loss in profits, as this event could lead to flights being cancelled (e.g. the Icelandic volcanic ash cloud in 2011 caused severe losses to many airlines). Also, a fatal accident, such as a plane crash, would also have a major negative on Ryanair, as consumers may feel unsafe in regards to barding a Ryanair air craft.