SWOT analysis is a strategic planning tool used to evaluate a company’s internal strengths and weaknesses, as well as external opportunities and threats. By conducting a SWOT analysis, businesses can gain a clearer understanding of their competitive position in the market. Strengths refer to the company's advantages, such as unique capabilities, strong brand, or loyal customer base. Weaknesses highlight areas where the company may be lacking, such as resource constraints or operational inefficiencies. Opportunities identify emerging trends or market gaps that the business can capitalize on, while threats are external factors like competition or economic downturns that could harm performance. A thorough SWOT analysis helps organizations make informed decisions, mitigate risks, and leverage their strengths for long-term success.