2.1 DANGOTE GROUP’S SWOT ANALYSIS
Large-scale enterprises face immense pressure to create sustainable value and expand globally for more competitive advantage and profits. However, building workforce capacity and pooling adequate capital to compete favourably in a different economic, political, and socio-cultural setting requires business leaders to conduct resource-based and value-chain analysis for in-depth knowledge of the business environment. For example, a SWOT Analysis allows identification of the internal factors (strengths and weaknesses) and external factors (opportunities and threats) that can enhance or impede maximization of economies of scale (Misbauddin & Nabi, 2019).
Figure 1: Dangote Group’s SWOT Analysis
| STRENGTHS | WEAKNESSES |
| Dangote Group has approximately 10,000 employees.It is Africa’s largest multinational and most capitalized company on the Nigerian Stock Exchange (NSE).Strong balance sheet and low net debt.The largest producer of cement in Nigeria.Strong distribution channel with over 5,000 self-owned trucks.Dangote Groups owns Africa’s largest cement factory located in Abuja.Efficient low-cost production plants located closely to essential national resources. | Dangote Group has poor market visibility outside Nigeria and selected countries within Africa.Manufacturing activities take place mainly in Nigeria.Does not leverage opportunities in Foreign Direct Investment (FDI) to increase global presence.Leadership lacks the right business model and internationalization strategies to expand beyond the African continent.Explores vertical and backward integration in its supply chain, with low merger and acquisition records. |
| OPPORTUNITIES | THREATS |
| Increasing demand for quality cement across Africa.Absence of limestone in countries importing bulk cement or related products from Dangote Group.Popularity as a reliable manufacturer of household and industrial products in over ten African countries increases opportunities for global expansion through mergers and acquisitions.Historical success in the cement manufacturing sector increases potential to explore production of building materials using brand equity, perceived quality, and customer trust. | Strong competition from LaFarge, Holcim, Heidelberg Cement, Jidong, Siam, and Cemex.Fluctuations in the global and local prices of raw materials.Language barriers and poor knowledge of demand trends in foreign markets.Big brands in the global cement industry currently do not operate in Africa, but their entry into African markets would threaten Dangote Group’s dominance.Corporate governance frameworks in African countries are stringent, a reason Dangote Group achieved competitive advantage and huge profits, however, global expansion exposes the multinational to regulatory risks that could reduce profitability. |
The Author (2023) Dangote Group’s SWOT analysis in Table 1 shows that every globalization strategy has its benefits and challenges because there are different levels of uncertainties, risks, and opportunities inherent in the micro and macro business environments. For example, strict government controls, changing needs of consumers, cultural issues, legal restraints, and other uncontrollable elements can negatively affect business prospects if a company does not consider the economic, political, and socio-cultural differences between its local environment and target market (Igwe & Kanyembo, 2019).
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