Questar SWOT Analysis, USP & Competitors

Posted in Energy, Total Reads: 265
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SWOT Analysis of Questar with USP, Competition, STP (Segmentation, Targeting, Positioning) - Marketing Analysis

Questar

Parent Company

Questar

Category

Energy and utilities

Sector

Energy

Tagline/ Slogan

Making lives better

USP

Integrated natural gas company

STP

Segment

Natural Gas requirements

Target Group

Residential and business

Positioning

Integrated natural gas company

SWOT Analysis

Strengths

1. Through its subsidiaries Questar Gas (retail gas distribution), Wexpro (production) and Questar Pipeline Company (gas transportation and storage), it operates in the entire length of value chain. This reduces dependability on third parties and helps them to provide reliable service. It also mitigates the risk of volatility of prices.

2. Questar Gas has a strong customer base of 962,225.

3. Questar Gas does not face any direct competition in Utah as it is the only non-municipal gas distribution utility there. 
4. Wexpro has strong investment base of $649 million (Dec’14).

5. It has experience of over 80 years and it built pipeline to transport gas from Wyoming to Utah in 1929.

6. Questar pipeline operates 2,670 miles of pipeline and it also operates largest under-ground storage in the Rocky Mountain region, the Clay Basin Storage facility.

7. Questar has strong corporate responsibility program. Through its Questar Education Fund, it funds scholarships and it also donates to renowned arts organizations through Questar Arts Foundation.

Weaknesses

1. Abundance of shale gas in US has resulted in decline of price of natural gas. Due to this margin in natural gas has also declined. It has also reduced the NGL revenues of Questar Pipeline.

2. Its operations are focused only in natural gas and that creates a risk for the company.

3. 97% of Questar Gas’s customers are located in Utah and this geographic concentration creates a risk for the company.

4. 91% Wexpro’s revenue was generated from Questar Gas. This dependency creates a risk as drop in sales for Questar Gas will also affect Wexpro.

Opportunities

1.  Increase in demand in natural gas creates opportunity for Questar.

2. Investment in new projects which can help them to expand operations can create opportunity for Questar.

3. Investment in pipeline infrastructure can create opportunities for them.

Threats

1. Various environmental laws and regulations are there in this industry and this creates a risk for the business as any unfavorable policy can harm business.

2. Natural gas demand depends on weather conditions as it is mostly used home heating systems and adverse weather can affect their business. Generally residential customers in Utah consume more than 80% of their natural gas usage during the coldest six months. To mitigate this risk Questar has employed weather-normalization mechanism.

Competition

Competitors

1. Avista Utilities

2. MDU Resources



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