Essay: External Factor Evaluation Matrix

Sample Essay

The External Factor Evaluation Matrix based on the opportunities and the threats faced by the Estee Lauder Companies is depicted below.

 

EFE Matrix

Opportunities

Weight

Rating

Weighted Score

Room for expansion

10%

3

0.3

Wide customer reach

8%

4

0.32

Access to prospective markets for new products

8%

4

0.32

Ability and resources to take on additional brands

7%

3

0.21

Increasing popularity of online shopping

7%

4

0.28

Ability to buy brands from regional markets

7%

3

0.21

Premium pricing based on brand value allows for high profits

8%

4

0.32

     

Threats

 

 

Intense competition in the market

20%

4

0.8

Inadequate R&D due to competition can result in lawsuits

15%

3

0.45

Restrictive trade policies

5%

2

0.1

Fluctuations in exchange rate

5%

2

0.1

Total Weighted Score

100%

3.41

The weighted score of 3.41 on the EFE matrix depicts Estee Lauder has an above average ability.

 

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