KPMG SWOT Analysis And Competitors- Find More About It

Introduction

Every time we have heard SWOT analysis we were able to say only the acronym and never thought to look into the depth of this concept. This article furnishes you with a reading brief about the SWOT analysis elements separately. Let us know more detail about ‘KPMG SWOT Analysis And Competitors’.

KPMG SWOT Analysis And Competitors

KPMG SWOT Analysis And Competitors

KPMG SWOT analysis includes four elements in a matrix. Calculated internal strengths and weaknesses of KPMG include widespread revenue and high fees. Calculated external opportunities and threats entail enormous growth and new entrants. Competitors include Big 4’s and other evolved companies.

The list of SWOT analysis is exhaustive and we have tried to list out a few. Continue reading to get a clear vision of KPMG. Let’s read KPMG SWOT Analysis And Competitors.

SWOT Analysis of KPMG

KPMG is a global financial accounting firm and by the tag name itself, it is the top 4 firm in the field of accounting. The segments of the firm are divided into accounting services, auditing services, and consultation services. 

KPMG’s managers use SWOT analysis to create a business model (or models) that will provide them a market edge in their market/markets. 

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In today’s fast-changing, globally competitive environment, a company’s chances of surviving are maximized when it has a competitive advantage.

The following three elements have a considerable impact on KPMG’s market performance:

  • The appropriate market position of a company. 
  • External risks and opportunities.
  • The organization’s resource capability to capitalize on the opportunities and to protect against the threats.

SWOT analysis plays a significant role to analyze the current position and performance of a company. In the case of KPMG, we can use SWOT analysis to evaluate the current status of all the components of KPMG.

Strengths Of KPMG

The first matrix of a SWOT analysis is strength. The following are some of the potential strengths of KPMG stated by the experts.

  1. KPMG has widespread revenue in the industry.
  1. KPMG has highly skilled employees from diversified backgrounds.
  1. KPMG is a top-notch consulting firm that provides expert services in audit, tax, and consultancy.
  1. It has been actively involved in the sponsorship of many events.
  1. Publishes much international knowledge and analytical publications across the globe.
  1. KPMG owns distinct categories of intellectual property rights

(Intellectual property rights includes a person’s mind’s creations, such as inventions, literary and artistic works) that are unique product offerings and are complicated to be imitated by rivals in the market.

  1. Easy accessibility to every nook of the country promotes geographic presence enabling it as the biggest strength.
  1. Context to the above point also facilitates KPMG to reach out to their target audience and market.
  1. Geographic presence has stimulated a wide geographic coverage and has strengthened the global distribution capability.
  1. A strong distribution network and dealer community helped in reaching KPMG’s potential market growth.

Weaknesses Of KPMG

The second element in the matrix of SWOT analysis is weaknesses. The following are the probable weaknesses of KPMG.

  1. Because of its high expertise and prices, not every client is suitable for KPMG’s services. 
  1. KPMG’s market share growth is limited due to stiff competition from large industry consultants and other knowledge consulting agencies.
  1. Even though KPMG spends more on research & development than the industry average, it still spends far less than select industry participants who have reaped significant benefits.
  1. Being behind in Research and Development can result in the decline of product quality and can undermine the company’s operations.
  1. People finding it difficult to balance work-life would conclude working less effectively and it can affect the productivity of the entire team.
  1. Limited market share growth due to limited market exposure in the industry.
  1. The net contribution percentage and the probability ratio don’t meet the industry average.
  1. The long-term growth of KPMG can be impacted due to the high level of day inventory compared to the competitors.
  1. KPMG’s research and development system is slow compared to other firms, leading many to question the investment of the same.
  1. KPMG is not using the cash efficiently that has affected the current asset ratio and liquid.

Opportunities Of KPMG

The third facet of a matrix provides positive opportunities in the SWOT analysis. Following are the potential opportunities of KPMG that can be grabbed to grow further.

  1. Tremendous growth prospects rising in the markets call for KPMG.
  1. Increased infrastructure spending may increase demand for consulting services.
  1. KPMG’s position in the business could be strengthened by the acquisition of smaller organizations.
  1. The ability to grow rapidly due to changing customers’ needs leads to a sharp rise in demand in one or more market segments. Also, existing customer segments have a great potential for growth leading to the opportunity for KPMG.
  1. With lasting, free cash flow allows KPMG an opportunity to invest in profitable segments.
  1. Openings of new markets concerning new consumer behavior.
  1. Opportunity to acquire contracts by federal governments.
  1.  New customers attracting KPMG’s new markets.
  1. A lower inflation rate leads to a lower credit period to customers and a lower credit interest rate to the customers that favors both the firm and the customers.
  1. Dilution of market forces will give a head start to KPMG as it dilutes the competitor’s advantage resulting in KPMG’s competitiveness to the other level.

Threats Of KPMG

The last element of the matrix of SWOT analysis is threats. Following are the unfavorable conditions KPMG deals with or is probable to deal with.

  1. Competition could spike up with the easing regulatory restrictions.
  1. A recession would impede the progress of KPMG.
  1. Increased opponent business means KPMG’s share of the market is shrinking.
  1. New entrants: The market has been flooded with new players who are gaining market share by stealing market share from existing companies. As a result of this, KPMG may lose customers to these new entrants in the market.
  1. Political uncertainty in the country can be a hindrance to business, causing performance to suffer and extra costs to be incurred.
  1. Tough competition from other “Big 4” companies may affect their market share.
  1. Shifting the buying pattern of consumers from online to another channel could highly affect the buyers that buy the products by physical presence and that results in a disturbance of the supply chain.
  1. Thick competitions in the local market hamper the growth of KPMG.
  1. A serious threat could be technology, rivals moving forward with technology could leave the KPMG behind in the market.
  1. Recruiting less skilled people compared to rivals could lead to another serious threat to steady growth and profits in the company.

Some Limiting Factors of KPMG’s SWOT Analysis

While SWOT analysis helps an organization to fully use its potential by capitalizing on the strengths and working on a weakness without missing out on grabbing opportunities to avoid maximum threats, still it is not ideal to use this only tool to strategize an organization, since it doesn’t answer the question of “how to do”.

That is why there are some limiting factors in SWOT analysis. Such as some points can be considered both as a strength and weaknesses at the same time. In this case, it makes it even tougher for the organization to segregate the elements into each store of the SWOT analysis matrix.

Some threats are underwhelming while the unnecessary threats are overwhelming. It all comes to a single channel of decision-making. If strategy makers don’t consider the limiting factors, the SWOT analysis may go out of hand and the above ones are only a few examples of it.

The biggest drawback of the SWOT analysis tool is that it won’t give a full picture to the analyzers or the interest parties.

Competitors Of KPMG

No doubt KPMG is the largest accounting firm in the industry, still, it has to face its competitors from the same industry.

With the latest ranking in terms of revenue in the years, 2018 to 2020 KPMG stood in 4th place, whereas Deloitte stood in 1st place with the highest revenue among other Big four companies. 

KPMG has earned revenue over $29.2 billion (lowest compared to other Big four companies) whereas Deloitte made $47.6 billion in revenue. PwC earned over $43 billion and EY earned $37.2 billion in the year 2020.

From the above figures, we can infer that KPMG has relished last in terms of revenue. 

Apart from the Big four companies (Deloitte, Ey, and PwC), KPMG’s competitors include Mckinsey & Company and Accenture as well. Recently the news has read out as “Grant Thornton emerges as a new challenger to Big four companies.” With this, we can say that KPMG has to face other companies along with Big 4’s.

Positive news in terms of competition: Among all the above companies KPMG stood 1st in terms of product quality ranking. 

Conclusion

Now we have learnt ‘KPMG SWOT Analysis And Competitors’, SWOT analysis alone doesn’t justify the performance of a company. Most experts believe that SWOT analysis holds ambiguity between strengths/opportunities and weaknesses/threats. To examine the viability one has to look into other analyses as well. 

Frequently Asked Questions (Faqs)
  1. Who are the competitors of KPMG?

The competitors of KPMG include McKinsey & Company, Ernst & Young (EY), Deloitte, PwC, Accenture, and Grant Thronton.

  1. What are a few internal strengths and weaknesses of KPMG?

Few internal strengths include the geographic presence, skilled employees, and weaknesses include diminishing product quality and high fees. 

KPMG SWOT Analysis And Competitors- Find More About It

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