Extensive SWOT Analysis of Softbank – A Japanese Multinational Conglomerate Holding Company

Quick Stats on Softbank

Founder	Masayoshi Son
Year Founded	1981
Origin	Japan
No. of Employees	89,909
Company Type	Public
Market Cap	$78.93 Billion (2022)
Annual Revenue	US$56.832 Billion (2020)
Net Income/ Profit	US$7.357 Billion (2020)

 

Products by Softbank 

With 45.621 million subscribers, Softbank provides the following products to offer. Some of them are

• Investment
• Internet
• Internet of Things
• Artificial Intelligence
• Robotics
• E-commerce

Competitors of Softbank 

The following are some of the close competitors of Softbank

• Telefonica
• iiNet
• Optus
• PLDT

Now as we are familiarized with the company brand and business let’s shovel into the SWOT analysis of Softbank.

SWOT Analysis of Softbank 

SWOT analysis is a strategic planning tool that can be used to do a situational analysis of the company by measuring strengths, weaknesses, opportunities and threats, the company is facing in its current business environment. 

It deals with two factors: internal and external. Strength and weakness are based on internal factors whereas opportunities and threats rely on external factors of the company.

To better understand the SWOT analysis of Softbank, refer to the infographics below:

Below is a step-by-step detailed guide to help you with the SWOT analysis of Softbank.

Strengths of Softbank

The brand’s competence gives an edge over capturing the maximum market in the industry and earning more profits. Hence here we go with the strengths as follows:

• Growing Operational Efficiency: Automating and increasing the efficiency of work through the use of AI and robotics and encouraging employees to make effective use of the freed-up time for self-development.
• Research & Development of New Technology: High-speed network services that use a wide range of frequency bands and are fully engaged in enhancing signals, using big data to improve quality and respond to events that attract large numbers of people.
• Automation of Activities: One of the major strengths of Softbank is the automation of all the activities and projects which has brought a good amount of consistency in the quality of the products. This automation has given an edge-over to Softbank to scale up and scale down according to the demand and conditions of the market’s current situation which is working from home & office. 

We all know that during the pandemic, businesses, brands and even education sectors have shifted their work on digital platforms using various digital marketing skills. After unlocking also the shift is constant and even growing more because people understood the endless benefits of digital marketing. Also, the skills are proven beneficial for students who are looking for career growth and job opportunities. 

• Reliable Telecommunication Network: SoftBank has leadership in the market in terms of reliable telecommunication networks. Its big expansion and acquisitions like acquiring Vodafone Japan and joint venture with Yahoo made Softbank strong in the market.
• Rebuilding Operation System: To manage multiple customer centres in a unified manner, Softbank is building a more efficient management system and improving the quality of customer support.
• Highly Skilled Service-minded Staff: Softbank Qualification Certification Exam and Y! Mobile Certification Exams are provided and qualified crew members wear a certification badge on their left lapel.

Weaknesses of Softbank

Every coin has two sides, now after a bunch of the strengths there come the weaknesses of Softbank.

• High Debt to Equity Ratio: During the past 13 years, the Debt to Equity Ratio of Softbank was 9.22. The lowest was 0.76 and the median was 3.03.
• Decreasing ARPU in Telecom Segment: Domestic telecommunications segment income decreased 5.1% year on year, to ¥683.0 billion, due to discounts on communication service charges resulting from an aggressive marketing strategy based on the Home Bundle Discount.
• Mounting Debt Pile Questions Softbank’s Creditworthiness: As SoftBank Group Corp. continues its transformation into a giant investment fund, some analysts are increasingly watching a metric more familiar to lenders as they judge its creditworthiness.
• Competition with Brands Affecting the Market: Although Softbank has a unique marketing strategy the new brands and other existing brands are also coming up with new strategies. But to maintain the position of best telecom services they need constant advertising, improvement in their products and this causes the majority of the expenses of the brand.
• Limited International Presence: Softbank currently operates in only Japan. It should consider operating in other countries, to expand its business and create strong brand recognition and awareness in the market.
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Opportunities for Softbank

There is always a way to add an extra mile to your work and improve sales, marketing, and profit.

• Money Making Opportunities in International Market: Globalization has led to opportunities in the International market and Softbank is in prime time to tap on those opportunities and grow.
• Reducing Cost of Market Entry: Globalization along with digital marketing and social media has considerably reduced the risk of market entry.
• Development in AI: Development in AI to better predict customer needs, cater to niche segments and make better recommendation engines.
• Changing Technology: Transforming the technology that Softbank operates in. Softbank can use these developments in improving efficiencies, lowering costs, and transforming processes.

Threats to Softbank

The environmental factors can prove to be a threat to the company and are harmful. Here are some threats:

• Growing Protectionism: Hedge the risk against growing protectionism ranging from – storing data into the international market to diversifying risk by operating into countries at different economic cycles.
• International Geo-Political Factors: Geopolitical factors have taken a turn for growing protectionism. Softbank should closely focus on these events and make them integral to strategy making.
• Sticky Prices in the Industry: Softbank operates in an industry where there is a culture of sticky prices. The Largest LBO in Japan case study can lead to the inability on part of the organization to increase the prices that its premium prices deserve.
• Technical Advancement: The new competitors in the race are with some advanced technology reducing the overall market share of Softbank.
• Challenging & Competitive Market Conditions: Intense competition has led to a declining active customer base, in particular for non-contract customers. Aggressive competition from other telecom brands results in the problem of retaining customers.
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This ends our detailed SWOT analysis of Softbank. Let us conclude our learning below.