WeWork SWOT Analysis
SWOT is an acronym for strengths, weaknesses, opportunities and threats related to organizations. The following table illustrates WeWork SWOT analysis:
| Strengths
1. Strong liquidity 2. International presence 3. Experience 4. Brand recognition |
| Weaknesses
1. Business has not achieved profitability 2. High level of indebtedness 3. Damaged company image 4. Business model easy to replicate |
| Opportunities
1. Entering into strategic collaborations 2. Strengthening WeWork ecosystem 3. Finding new sources of competitive advantage 4. Increasing marketing efficiency |
| Threats
1. Inability of Sandeep Mathrani to turn around the business 2. Members seeking payment concessions or deferrals or cancellations 3. Emergence of new competitors with innovative business models 4. Changes in customer attitudes towards shared workspace |
WeWork SWOT Analysis
Strengths in WeWork SWOT Analysis
1. WeWork has a strong liquidity. As of December 31, 2021, the company had access to USD2.0 billion of liquidity in the form of cash and commitments from its lenders. Strong liquidity offers a range of benefits for the workspace provider such as ability to meet short-term debts and dealing with unforeseen circumstances.
2. The global flexible workspace provider operates a network of 756 locations in 38 countries as of December 2021. Global presence offers a range of advantages for the workspace provider. These include economies of scale, access to local talent and opportunity to increase revenues.
3. WeWork had to deal with a range of serious issues such as ineffective management, severely flawed corporate culture and starting many initiatives at the same time. These setbacks damaged the brand image to a considerable extent. At the same time, it can be argued that the process of having to go through these problems have been a valuable experience for employees at all levels. Specifically, thanks to these issues WeWork employees at all levels are more mature now and they are highly motivated to succeed.
4. WeWork has become synonym with flexible workspace the same way Google is synonym with online search and Xerox with paper copying. High level of brand recognition is a considerable strength as it can assist in achieving market leadership and lay foundations for the long-term growth.
Weaknesses in WeWork SWOT Analysis
1. Despite being in the business for more than a decade profitability is nowhere in the view for WeWork. The co-working giant had an accumulated deficit of USD14.1 billion, USD9.7 billion and USD6.6 billion as of December 31, 2021, 2020, and 2019, respectively. Furthermore, the company had net losses of USD4.6 billion, USD3.8 billion, and USD3.8 billion for the years ended December 31, 2021, 2020, and 2019 respectively.[1] Recent massive job cuts in tech industry are making it even more difficult for WeWork to reach profitability.
2. High level of indebtedness is one of the major weaknesses for WeWork. The global flexible workspace provider has expensive long-term leases and more than USD3 billion of debt. Taking into account the fact that the co-working giant does not see profitability on its horizon, existence of massive debts is a major issue. Due to high level of indebtedness and other reasons Fitch Ratings downgraded some of WeWork’s bonds to junk CCC in December 2022.
WeWork Inc. Report contains a full version of WeWork SWOT Analysis. The report illustrates the application of the major analytical strategic frameworks in business studies such as PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on WeWork. Moreover, the report contains analyses of WeWork leadership, organizational structure, business strategy and organizational culture. The report also comprises discussions of WeWork marketing strategy, ecosystem and addresses issues of corporate social responsibility.
[1] Annual Report 2021, WeWork