SWOT analysis of Lindt Chocolates

Lindt is a Swiss chocolate company named Chocoladefabriken Lindt & Sprüngli AG which is a specialist in premium chocolates. The company which was founded in the year 1845, specializes in both dark and milk chocolates and has an entire range of chocolates for various occasions as well as specialist chocolates. In addition, they also sell seasonal confectioneries, desserts, ice -creams and liqueurs.

They are also a specialist in pralines. The company which is one of the world’s most expensive chocolate makers registered an annual turnover of 3.65 billion CHF in the year 2015. Switzerland which is famous for its milk products became popular for Swiss chocolates primarily because of Lindt which is also one of the world’s oldest chocolate companies.

Strengths in the SWOT analysis of Lindt Chocolates

The following are the strengths of Lindt Chocolates:

• Huge infrastructure: The company has a huge infrastructure that connects them to countries across the world.Lindt operates around 20 subsidiaries worldwide and eight production sites in Europe and the USA.
• History of chocolates: Switzerland as a country has had a history of chocolate making and though they were not a major producer of cocoa, their chocolates have always been deemed as the best. This history of association with tasty chocolates has been a strength for most Swiss chocolate makers including Lindt.
• Unique features and taste: Lindt Chocolates are known for the difference in taste and texture. Some of the unique features include the conch which increased the smoothness of chocolate and the unique process of tempering which cuts down the formation of crystals on the surface of the chocolate and the technique of creating chocolate fillings.
• Emphasis on quality: Rudolph Lindt had deep connections with the rich of the region and thus from the very early years Lindt has always made chocolates for the elite. The brand has thus always focused on quality and never compromised on the quality of the ingredients or the process of manufacturing.
• Composition: The ingredients that make the Lindt chocolates are what makes the chocolates extra special. The chocolates are made with the finest cocoa in the world which is sourced directly from Ghana, Ecuador, Madagascar and the Caribbean.

Weaknesses in the SWOT analysis of Lindt Chocolates

Some of the key weaknesses of Lindt are :

• Low sales in the US: One of Lindt’s premier markets in the USA and there has been a steep decline in chocolate sales in the region.There has been a hit in the sale of pralines which is what Lindt is all about.
• Increase in raw material costs: There is a steep increase in the price of cocoa beans which is the primary raw material for chocolates.The competition amongst top grade retailers has got down the margins for chocolate manufacturers.
• Focus on niche markets: Most of the offerings of Lindt are meant for niche markets where their target groups are people with money who can afford to spend on custom made specialty chocolates. This is making it difficult for them to target the mass market where the bulk of the sales happen.
• Expensive: The popular perception is that Lindt is an expensive brand of chocolates and this restricts their target market to the premium segment only. Moreover, there is also a perception amongst the middle-income groups that there is no reason to spend exorbitantly on chocolates which makes it worse.

Opportunities in the SWOT analysis of Lindt Chocolates

Some of the opportunities include :

• Growing demand for dark chocolate: Globally there is a surge in the demand for dark chocolate since it is presumed to be healthy. Moreover, many chocolate companies are also adding organic ingredients to chocolates trying to bring down sugars etc which in turn are opening up new segments.
• Growth potential in India: Chocolates which were once a popular item in the western world is now waning. The focus is now on Asia especially India where the markets for chocolates is expected to grow at 15 %- 23 % per annum.

Threats in the SWOT analysis of Lindt Chocolates

Some of the threats include:

• Negative perceptions on sugar: All foods that contain sugar are seen as unhealthy today and this is creating the dip in demand for chocolates which are rich in sugar. The demand for chocolates globally is at an all-time low and luxury brands are the worst hit.
• High competition: Just within its home market itself Lindt faces a lot of pressure from competition. The main players here include Frey, Toblerone, Milka, Suchard, and Cailler.Globally their biggest competitor is Mondelez which also owns the brand Cadbury’s now in addition to other premium brands of chocolates.