BASF is a German chemical manufacturing multinational company. Friedrich Engelhorn founded the chemical company in 1865. Today, we’ll discuss the SWOT analysis of BASF; it outlines strengths and weaknesses; opportunities and threats that the company has to face; as a business strategy analysis example company.
Products and services portfolio of BASF
- Natural gas exploration
- Crul oil finding and production
- Corp technology
- Coatings
- Catalysts items
- Performance Chemicals
- Plastics
- Chemicals
Subsidiaries of BASF
- Pinturas Thermicas
- Succinity
- Isobionics
- Verenium
- Siegfried PharmaChemikalien
- BTC Europe
- Chemster
- Cognis
Statistical facts and figures of BASF
- Annual revenue – 87.3 billion Euros (2022)
- Net income – -627 million Euros (2022)
- Employees – 112000
- Asset net worth – 84.6 billion Euros (2022)
Competitors of BASF
- Huntsman
- AkzoNobel
- Dupont
- FMC Corporation
- Advanced Energy
- EuroChem
- Evonik
- DSM
The SWOT analysis of BASF would analyze the internal strengths and weaknesses of the company; and external opportunities and threats that the brand has to face. Here’s BASF SWOT analysis as business strategy analysis example company as follows;
Strengths of BASF
Some of the main internal strengths in the BASF SWOT analysis example company as business strategy analysis are as follows;
Large Network
BASF has established a very large network of over 380 production and manufacturing facilities in over 90 countries across the world. The chemical brand is serving customers in over 190 countries across the world. The worldwide network of production and manufacturing facilities and loyal database of customers further strengthen the company’s position in the chemical market.
Research and Development
According to an estimate, BASF invested approximately 2.3 billion Euros in research and development and employed more than 10,000 employees in its research units in 2022. High capital spending on research and development shows the company’s strong commitment to innovation and creativity in the chemical industry.
Sustainability Initiative
BASF has taken environmental sustainability initiatives throughout its supply chain and distribution network. It ranges from ethical sourcing and procurement of raw materials and sustainable production methods. It shows the company’s strong commitment to the environment, society, and people.
Portfolio Diversity
BASF has developed a well-diversified product portfolio comprising of a wide range of products and services. They’re like coatings, oil, gas, plastics, chemicals, catalysts, and others. The large and well-diversified product portfolio helps the company to target various segments of the customer market.
Efficiency
BASF has been operating its business in the chemical industry for the past 165 years. The chemical brand has a long history and successful track record of producing and manufacturing chemicals. Years of experience and heavy research spending allowed the company to achieve operational and production efficiency.
Weaknesses of BASF
Some of the main internal weaknesses in the BASF SWOT analysis example company as business strategy analysis are as follows;
Over-reliance on Automobile Clients
Automobile companies are the major clients of BASF products and chemicals. In fact, the company is heavily relying on them as its main sources of revenue and profitability. The automotive companies are the main target of the economic downturn. However, high reliance on a few client companies is not a good business and marketing strategy.
High Operational Expense
BASF needs to invest a significant amount of capital resources in research, production and manufacturing equipment, testing, and tech expertise. All of these expenses would significantly increase the operational cost of the company. It ultimately impacts the company’s revenue and profitability.
Opportunities for BASF
Some of the main available opportunities in the BASF SWOT analysis example company as business strategy analysis are as follows;
Market Expansion
BASF should consider expanding its chemical market by entering new geographical regions, countries, and markets across the world. Asian, Chinese, Southeast Asian, Indian, and African markets hold great growth potential; the chemical brand would find many new client companies in those regional markets.
Portfolio Expansion
Along with market expansion, BASF should amplify its chemical product by launching new catalysts and chemical variants for client industries. New innovative products would help the chemical brand target new types of industries and client companies.
Digital Technology
BASF should invest capital resources in digital technology to improve its production, manufacturing, and operational processes. Automation and AI technology would help the chemical company to efficiently utilize its resources and save costs.
Strategic Alliance
BASF should develop strategic alliances with other chemical manufacturing companies in the developing countries. The joint venture and sharing of resources would help the company to increase its customer market in the new regions.
Threats to BASF
Some of the main potential threats in the BASF SWOT analysis example company as business strategy analysis are as follows;
Competition
Dupont, EuroChem, and Evonik are the top competitors of BASF chemical company. They all have earned a significant market share with a large network of client companies. Their market presence makes it difficult for the company to maintain its market share in the chemical industry and global market.
Environmental Sustainable Trends
Chemical products pose a significant to the environment and society at large. The sustainability initiative of the company BASF is lower and it has a limited impact.
Conclusion: BASF SWOT Analysis Example Company |SWOT Analysis of BASF |Business Strategy Analysis
After an in-depth study of the swot analysis of BASF; we have realized that BASF is the world’s leading German chemical manufacturing company. If you are learning about BASF SWOT analysis example company; then you should keep in mind the abovementioned internal strengths and weaknesses; and external opportunities and threats as brand strategy analysis.
Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. Other than that, he’s a fun loving person.
